Nova Credit, which helps newly arrived immigrants to the U.S. secure credit, has raised $50 million in funding.
Kleiner Perkins led the fundraising, which was joined by Canapi Ventures. Current investors Index Ventures, General Catalyst and Nyca Partners participated, along with Sound Ventures, a venture-capital fund founded by Ashton Kutcher and Guy Oseary. The round also received backing from retired baseball star Alex Rodriguez, a statement said.
“We’re very excited,” said Misha Esipov, Nova Credit’s co-founder and CEO. The San Francisco fintech has raised $70 million in total. This includes the current $50 million B round, a $16 million Series A in 2018 and a $4 million seed round in 2016. Nova plans to use the funds to invest in more products and add customers as it seeks to become a central destination for new U.S. immigrants, a spokeswoman said.
Launched in 2016, Nova Credit is aiming to build an international credit bureau that will help consumers transport their credit across borders. Esipov estimates that there are 50 million immigrants in the U.S., while one in six Americans is an immigrant. These “newcomers” to the U.S. often feel like “second class citizens,” said Esipov, because they often arrive with no credit history. This makes it very hard for them to secure a credit card, an auto loan or even get a cellphone. “A credit history is incredibly important to establishing yourself as an American,” said Esipov, who came to the U.S. as a child.
Nova is seeking to make credit portable across borders. After securing consent from a consumer, Nova will buy the person’s credit report from foreign credit bureaus and translate the data into a U.S.-equivalent score and format through its CreditPassport. Consumers receive copies of the translated report via email at no cost, a spokeswoman said. Nova then sells the information to U.S. and Canadian businesses.
Nova has partnerships with credit bureaus in 19 countries; 11 of these partnerships, including those in Australia, Brazil, Canada, India, Mexico and the U.K., are in operation, the spokeswoman said. Nova’s deals with agencies in the Dominican Republic and the Philippines will debut later in 2020, the spokeswoman said.
In October, Nova announced a partnership with American Express (ticker: AXP). AmEx uses Nova to access credit reports from Australia, the U.K., Mexico, Canada and India. These five countries represent one-third of the U.S. immigrant population, the Nova spokeswoman said. Newcomers from these five countries who apply for an AmEx card through Nova Credit are much more likely to receive approval than through traditional underwriting solutions for new-to-credit applicants, the spokeswoman said.
Nova Credit has a “few dozen customers,” Esipov said. In addition to American Express, the list includes the United Nations Federal Credit Union, MPower Financing, Yardi, Intellirent, First Advantage and more. “We have some really exciting partnerships in the works in the next few months,” he said.