US-based digital bank Varo has successfully secured $29 million in funding as part of a broader initiative aimed at raising $55 million.
To date, Varo has attracted over $1 billion in investments, yet it has faced significant challenges, leading to a drastic decline in its valuation due to ongoing financial losses. In its most recent funding round in 2023, Varo raised $50 million at a valuation of $1.5 billion, reflecting a sharp decrease from the $2.5 billion valuation achieved in September 2021, following a substantial $510 million Series E financing round.
Established in 2015 by former Wells Fargo executive Colin Walsh, Varo made history in 2020 by becoming the first U.S. consumer fintech to obtain a national bank charter. This pivotal milestone allowed the digital bank to provide a comprehensive array of FDIC-insured financial services.
Recently, Walsh announced his departure from the company, with Gavin Michael, the former CEO of cryptocurrency exchange Bakkt, set to take over as the new chief executive.