Petal, which offers credit cards based on a potential borrower's cash flow rather than credit score, raises a $140M Series D, source says at an $800M valuation
I am incredibly proud to share that Petal has raised $140 million … Finextra : Credit card for the underbanked Petal raises $140 million Series D PYMNTS.com : Petal Raises $140M Series D Toward Credit Building for the Underserved FinSMEs : Petal Raises $140M in Series D Funding Tweets: Mary Ann Azevedo / @bayareawriter : I wrote about how @petal just raised $140M at a $800M valuation after quadrupling revenue and tripling its user base in 2021. The company offers “modern” Visa cards aimed at people with thin to no credit or those rebuilding their credit. https://techcrunch.com/...
Context & Ripple Effects
Petal's Series D caps a steady climb through venture rounds: a $30M Series B in 2019 and a $55M Series C in 2020, both led by Peter Thiel's Valar Ventures, established its core pitch — underwriting Visa cards on bank-account cash flow instead of FICO scores for people with thin or no credit files. The new round lands after the company says it quadrupled revenue and tripled its user base in 2021, making it one of the better-capitalized players in the credit-invisible segment.
First-order effects
- Petal gets $140M of primary capital at an $800M valuation to fund the balance-sheet and acquisition costs of scaling cash-flow underwritten lending, where every new cardholder requires the company to extend credit without a bureau score as a backstop.
Second-order effects
- The round pressures adjacent players on both sides of the score: Credit Sesame, which monetizes helping consumers repair existing credit scores, now competes against an issuer arguing the score itself can be bypassed, while infrastructure startups like Power — which emerged from stealth months later with a $16.1M seed and $300M credit facility — bet that even cash-flow lenders will want outsourced card issuance rails.
Third-order effects
- If cash-flow underwriting keeps winning capital while co-branded plays like Cardless scale separately, card issuance splits into layers — underwriting data, balance sheets, and issuing infrastructure owned by different companies — eroding the vertically integrated issuer model that banks have held for decades.
The trend: Consumer credit is decoupling from the bureau score, with venture capital funding alternative-data issuers and the infrastructure vendors that serve them.