Copper, a teen-focused digital banking service, has secured $29 million in a “preemptive” Series An investment headed by Fiat Ventures. The funding comes just over seven months after the business announced a $9 million initial round that comprised Panoramic Ventures, Insight Partners, Invesco Private Capital, and “all current investors,” according to the company. Since its start in 2019, it has raised a total of $42.3 million.
Copper has expanded to over 800,000 customers since its introduction last May. That’s up from 350,000 in October of last year. While the firm refused to provide its value or actual sales data, it did remark that revenue growth is in line with user growth, which has more than quadrupled since October 2021, as mentioned above. Copper, founded in Seattle, offers customized debit cards, ATM access to 50,000 locations, and compatibility for digital wallets such as Apple Pay, Google Pay, and Samsung Pay.
Copper allows parents to send money to their children and track their spending, according to the business. Teens may use P2P transfers to pay peers and set up direct deposit for after-school and summer employment. The fintech also provides advice on “financial essentials” including dividends, budgeting, and compound interest. Copper has been preparing to expand into investing over the last year, with intentions to enroll its first batch of consumers within the next month. Customers will be able to send cash from their accounts into a “broad spectrum” of assets, including equities, mutual funds, and cryptocurrencies.
According to CEO and co-founder Eddie Behringer, the decision was motivated in part by user demand. “It was definitely driven by a lot of demand from teenagers.” “When we questioned parents about it, this was the one financial area that they attributed the most value to — in terms of us being able to offer their adolescents access, and then really the education behind that access,” he told TechCrunch. According to Behringer, another reason for the shift was to promote the company’s objective of being a teen’s “financial first.” Copper also aims to provide “a safe area” for kids to invest in general, but specifically in cryptocurrency, according to the CEO.
“What we’ve observed is that kids are obtaining access to investing and bitcoin against their parents’ best efforts,” he told TechCrunch. “At its most basic level, this was about ‘How do we allow kids access and independence in an environment that is actually predicated on safe parental restrictions,'” Behringer told TechCrunch. “We were aware that teenagers were gaining access to services like Robinhood, which is based entirely on the monetization of frequent trading. We set out to create a product that functioned in the other direction.” Copper argues that investing through the firm provides teenagers with a controlled environment where they “may learn as they invest, and where parents can see where every dollar goes.”
Copper is one of several teen-focused fintechs that has lately added a cryptocurrency component to its operations. Step, a Series C fintech startup that provides financial services to teens, has launched a new product that would allow its 3 million-plus members to trade in stocks and cryptocurrencies using its smartphone. The business expects to debut Step Investing, a new product, later this summer. Last month, investment app Onu opened custodial accounts for children with access to 22 cryptocurrencies, while children’s social network Zigazoo began dropping NFTs in April, as Anita Ramaswamy previously reported. Acorns CEO Noah Kerner told TechCrunch earlier this year that the youth-focused savings and investing startup plans to include “no more than 5% exposure” to crypto as an option for customers who want to participate, but that “there will not be crypto trading on the Acorns platform,” according to Kerner.