Fintech startup Upgrade has had a banner year. Just four months after completing a round of funding this summer that led to a valuation of $3.42 billion, the company has now concluded another Series F round that boosted Upgrade’s value to nearly double that, topping out at $6.28 billion.
What’s behind this remarkable growth? Apart from a series of savvy moves orchestrated by company leadership such as Chief Executive Officer Renaud Laplanche, Americans are increasingly looking to Upgrade as they accumulate ever-higher amounts of debt. The company can help them deal with that debt in a smarter way.
In a Zoom interview, Laplanche explained, “Traditional credit cards are a really bad consumer product with very high interest rates and lots of fees.” Upgrade’s flagship product, by comparison, converts traditional credit card debt into fixed-rate installment loans. In other words, Upgrade has successfully applied the increasingly popular buy now pay later (BNPL) model to burdensome consumer debt, and users can’t get enough of it.
Unsurprisingly, Upgrade is not sleeping on its success. Buoyed by the explosive growth demonstrated this year, the company is putting out new products including checking accounts and Bitcoin rewards cards in preparation for an IPO expected in 2023.