Atlanta-based, teen-focused, digital banking startup Greenlight raised $54 million in a Series B round, led by Drive Capital with additional investments from Live Oak Bank, JPMorgan Chase and Wells Fargo, according to Cheddar. The firm is targeting a gap familiar to many financial advisors: the transfer of wealth—and financial know-how—from parents to children.
The company provides its customers with a spending account with parental controls, linked to a debit card. Parents can decide where their kids can spend money, and how much, for a subscription price of $4.99 per month per family. Financial lessons can also be passed along through Greenlight’s savings account, which offers a parent-set and parent-paid interest rate, goal setting and tracking and a feature where parents can set and track their kids’ weekly chores and payouts.
"There are a lot of things to teach and the best way kids learn is by doing—by having to actually make the tradeoff decision between buying something in front of them right now and saving for a purchase later," Greenlight’s CEO Tim Sheehan told Cheddar. The financial planning lessons, imparted at a young age, have an impact: “Something a lot of kids learn fast is to keep all their money in savings and that way they have to make a conscious decision to move it through the spend area to go and make a purchase,” he added.
Greenlight will also be launching an investment account “fairly soon,” according to Sheehan. The fresh capital from the Series B will go towards marketing and fine-tuning its investment offering, noted Cheddar.