The fintech sector is booming on a global scale. In this article, you’ll discover a list of the top 10 fintech companies in the USA and will get to know the most essential facts about each of them.
Stripe
This one was established in Palo Alto, California, in 2009. Its founders, Irish-born brothers John and Patrick Collison, dropped out of Harvard and MIT, respectively. With its $95 billion valuation, Stripe is the largest financial company in the United States. It occupies the second position in the rating of the most valuable fintech startups in the world. Ford, Spotify, and Twitter are among the most famous brands that have partnered with Stripe.
This company specializes in financial services and SaaS. It builds APIs and payment processing software for mobile apps and e-commerce websites. It also makes anti-fraud tools that block fraudulent transactions as well as billing solutions for online businesses that allow companies to manage subscription recurring revenue and invoicing. Stripe has released a point of sale service to read physical cards and a merchant cash advance scheme.
It has created the Atlas platform to facilitate the process of registering startups as US corporations. Stripe offers credit cards and loans to companies from the US. Human professionals are not involved in the process of approving these loans because machine-learning algorithms take care of this task. To promote knowledge that supports innovative businesses, Stripe created its own publishing company.
Being one of the most promising software development companies, this startup has received funding from Y Combinator, Peter Thiel, Elon Musk, Sequoia Capital, Andreessen Horowitz, SV Angel, General Catalyst, Founders Fund, Thrive Capital, CapitalG, Tiger Global Management, Ireland’s National Treasury Management Agency, Insurers Allianz SE and AXA SA, Baillie Gifford & Co., and Fidelity Investments.
In its turn, Stripe allegedly provided financial support to:
- Monzo — a UK-based “challenger bank”
- Fast — an one-click checkout service
- Step — a company that offers fee-free bank accounts to teenagers.
Plus, it has invested in businesses that are similar to Stripe but located in other parts of the planet, such as Paystack from Nigeria, PayMongo from the Philippines, and Safepay in Pakistan.
Kraken
This San Francisco-based cryptocurrency exchange was founded by Jesse Powell in 2011 and has reached a valuation of $20 billion. It’s the second-largest exchange on the American market by transaction volume and the first one in Europe. Users love Kraken for its extensive range of tools and accounts that suit any type of investor or trader. Crypto enthusiasts can benefit from margin-based and leverage trading, profit-taking and stop-loss orders, automated strategy trading, dark liquidity pool, and other helpful solutions.
From the onset, Kraken offered an extensive range of cryptocurrencies to its clients. Plus, it accepted multiple fiat currencies. The platform took off quickly because it simplified the process of carrying out financial transactions to and from linked digital wallets and bank accounts.
In 2014, Bloomberg selected Kraken as one of the information sources that fed its terminal with the BTC market data. That strengthened the reputation of the exchange among private users and businesses. A bit later, Kraken became a partner of TradingView, the leading web resource where traders and investors can exchange opinions and valuable insights.
The same year, Kraken became one of the companies that tried to help the clients of Mt.Gox — a BTC exchange that went bankrupt. If clients of the defunct Mt.Gox wanted to get their Bitcoins back, they had to sign up for Kraken. Many of these people genuinely loved the new exchange and stayed with it. For Kraken, it was not just a stroke of luck. Jesse Powell visited the Mt.Gox office in 2011 after the latter suffered from a security breach. Jesse realized that the well-known exchange was about to close — and that’s why he launched his own platform as a more advanced alternative.
In 2021, Kraken’s trading mobile app saw light. Besides, this brand has dedicated apps for futures and professional users.
Chime
Chime is one of the biggest fintech companies that offer alternatives to traditional banking services. However, it is not allowed to use the term “bank” in its marketing materials. All the services that it provides are handled by Stride Bank and The Bancorp Bank.
Chime was founded in 2013, in San Francisco, by Ryan King and Chris Britt. Its current valuation reaches $14.5 billion. The primary competitive edge of the brand is that it doesn’t charge monthly or overdraft fees. Every year, the average American resident pays $329-worth banking fees. To make a profit, Chime takes a percentage of the transaction fee charged to merchants.
Chime has no physical branches. Clients can issue debit or credit cards by Visa and use the Chime mobile app or its website. In the app, users can create checking and savings accounts. The company offers early wage access, an automated savings feature, checking accounts with no minimum balance, and other fee-free banking products. It created a Credit Builder — a credit card that enables clients to shape their credit history.
The overdraft service of Chime allows consumers to overdraw their accounts for up to $100. They won’t need to pay a fee for overdrafting or trying to make purchases after having reached the maximum allowed limit. Once a user runs over the $100 limit, their purchases will be declined. This product is available only to clients who make direct deposits of at least $500 per month.
In 2018, this company acquired Pinch — a startup that allows teenagers and youngsters to report on-time rent payments to credit bureaus to build their credit scores.
In 2020, Chime launched a pilot program to help consumers overcome the financial difficulties caused by the pandemic. A $1,200 advance on the Economic Stimulus Payment was offered to individuals who e-filed tax returns with the IRS via Chime.
Plaid
William Hockey and Zach Perret launched this company in 2012. Today, its valuation is around $13.4 billion. The Plaid headquarters is located in San Francisco. This custom software development business has created a data transfer network that powers digital finance and fintech products. It enables fintech companies in America and Europe to connect to their clients’ bank accounts without building the necessary infrastructure themselves. Initially, Perret and Hockey were focused on bookkeeping and budgeting software as well as other consumer financial management products. But they struggled to connect bank accounts to the solutions that they wanted to build — and that’s why they came up with another business concept.
Thanks to Plaid, businesses and private users can interact with their bank accounts, check balances, and carry out transactions through different financial technology applications. To link their bank funds to the app, clients need to share their bank login credentials with Plaid. Alternatively, customers of selected banking institutions can access the app through their banks’ portals. In 2020, the company announced the “all-new Plaid Link” to simplify the process of connecting various financial solutions.
Plaid got financial support from Spark Capital, Google Ventures, New Enterprise Associates, Goldman Sachs Investment Partners, Mary Meeker, Index Ventures, Andreessen Horowitz, Altimeter Capital, Visa, and Mastercard.
In 2020, Plaid hit the headlines because Visa announced its plans to acquire this development company for $5.3 billion. However, the acquisition never took place because it failed to get approval from the Department of Justice. The officials classified Visa’s behavior as an attempt of a monopolist to purchase its rival.
Plaid, for its part, has acquired its competitor Quovo for $200 million in 2019. In three years, it acquired another rival (Cognito, an identity verification and compliance platform) for an undisclosed sum.
Robinhood
This California-based startup was founded in 2013 by Baiju Bhatt and Vladimir Tenev. Now, its valuation is around $11.7 billion. As the Robinhood name suggests, this company strives to grant access to financial markets to all types of users and not only wealthy individuals. Conventional trading platforms charge high fees. These companies offer services only to clients who can afford to conduct transactions with large sums of money. Robinhood was conceived to change the rules of the game by offering commission-free trades of stocks, cryptocurrencies, ETFs, and options. It received financial support from DST Global, Greenoaks Capital, Thrive Capital, Sequoia Capital, and D1 Capital Partners.
The official app of this startup hit the market in 2015. Its primary target audience was millennials and its average customer age was 26. By 2021, 31 million individuals have signed up for the app. In 2020, the stock market crashed — and Robinhood users were trading assets very actively during that crisis. When the market recovered, some media stated that Robinhood was largely responsible for that. However, further studies revealed that the app didn’t impact the situation that dramatically. In 2021, the startup went public.
Robinhood makes money on margin lending, selling order information to high-frequency traders, and earning interest on customers’ cash balances. In 2019, it enabled its users to open savings and checking accounts as well as issue debit cards through Sutton Bank. The same year, a new Cash Management feature was launched with an annual 1.8% interest rate and FDIC insurance from partner banks.
In 2018, Robinhood allowed its clients to trade cryptocurrencies without paying fees. The geographical coverage of in-app crypto trading and the list of supported currencies has been steadily expanding. The company is planning to release a crypto wallet soon.
Concerning traditional assets, one of the most important short- and mid-term goals of Robinhood is to start providing 24/7 equities trading.
Brex
This California-based company was launched in 2017 by Stanford dropouts Pedro Franceschi and Henrique Dubugras. Brex got funding from Ribbit Capital, Y Combinator, DST Global, Kleiner Perkins, Lone Pine Capital, and Greenoaks. Initially, the two founders were planning to found a VR startup but pivoted it to join the Y Combinator’s 12-week accelerator program. Before they focused on Brex, Franceschi and Dubugras created an online payments company called Pagar.me and sold it to Stone.
The valuation of Brex reaches $7.4 billion. It offers cash management accounts, expense-tracking software, and business credit cards to technology companies. To get such a card, a client needs to have at least $100,000 in their bank account. If professionally invested, they can have $50,000. If the cardholder defaults, their personal assets won’t suffer. Brex cards can be physical or virtual. Clients don’t need to pay monthly fees or per-item fees for transactions above a certain threshold. Brex cards used to be issued by Emigrant Bank. In 2021, the startup announced its plans to open its own bank.
Brex cards holders get rewards for their purchases. The largest rewards are credited for the following types of expenses: traveling, recurring software purchases, restaurants, and rideshares. Clients can redeem reward points for cash, gift cards, and statement credits. Besides, they can transfer points to one of eight frequent flyer programs. In 2021, the company allowed its clients to redeem rewards points for Bitcoin and Ethereum. Brex became the first B2B startup from its niche to introduce crypto rewards credit cards. In terms of the rewards program, Brex has teamed up with TravelBank. The latter collaborates with the Coinbase crypto platform to offer free wallets to clients who redeem their points for BTC or ETH.
Carta
This one was founded in 2012 by Henry Ward and Manu Kumar. Initially, it was known as eShares but underwent rebranding. Today, Carta’s valuation reaches $6.8 billion and it is considered one of the most promising custom software development companies in the US. Affirm, Tilray, Casper, Coinbase, and Slack are among its most well-known clients. Venture firms rely on its software too. It was backed by Spark Capital, Tribe Capital, Meritech Capital Partners, Andreessen Horowitz, Menlo Ventures, and Social Capital.
The target audience of this business is employees, investors, and private companies. Carta tracks capital tables on the cloud for them and provides valuation software. It digitalizes paper assets (such as stock certificates) and reveals a real-time picture of company ownership. Users can clearly see equity dilution at each funding round and the percentage of business that belongs to a specific investor.
Plus, it has built CartaX — a secondary marketplace that enables unicorn startup team members to sell their shares to investors before an IPO or acquisition. Carta sold around $100 million of its own stock on this exchange. Anyone who qualifies for stock options can get digital share certificates issued by company founders. To keep track of stock ownership, issuers can use a centralized dashboard. Through this dashboard, you can check which owners are willing to sell as well as the prices and timing of the issued shares.
In 2016, Carta partnered with Zenefits — a cloud-based human resources company that wanted to add equity management to its platform. Next year, Carta acquired Silicon Valley Bank Analytics — Silicon Valley Bank’s valuation business that used to be its competitor. By 2021, this startup had facilitated roughly $1 billion in secondary-market sales and was reported to track over $800 billion in company equity.
Carta issues studies about the gender equity gap across industries and equity gap studies called Table Stakes. The latter display equity gaps between founders and other team members based on selected demographic parameters in the high tech sector and several other industries.
Gemini
This $5 billion-worth, New York City-based startup has an exciting story. Its founders, identical twins Tyler and Cameron Winklevoss, went to Harvard together with Mark Zuckerberg. Mark stole their idea of creating a social network and had to pay a $65 million settlement. The twins spent some of this money on Bitcoin, became billionaires by 2017, and decided to start a crypto exchange.
Gemini lets users trade both cryptocurrencies and fiat currencies. In total, it supports around 60 currencies. One of these currencies is the Gemini dollar — a stable coin whose price is tied to the US dollar. The platform stores most coins offline, in cold wallets.
Initially, the target audience of the platform was institutional traders. Then, it began to accept individual investors too. These two types of customers have separate interfaces and fee structures. Each year, the exchange processes around $30 billion in transactions. Unlike many of its competitors, Gemini doesn’t allow short trading and margin trading. All orders have to be fully funded. Users can benefit from a variety of limit orders.
The exchange has a highly user-friendly interface and a handy mobile app. Over 30,000 retailers accept money through its payment app and buyers don’t need to pay fees for using this software for purchases. Plus, Gemini is planning to start issuing its own credit cards. To help its clients calculate their crypto-related tax obligations, the company has teamed up with TaxBit.
Since 2021, Gemini offers interest accounts to its users. If you hold your crypto savings on this platform, your annual interest rate might reach 8.05%. That’s much more compared to what traditional banks offer. If you keep your fiat dollars in a conventional bank account, you can expect to get an annual rate of 0.01% to 0.60%.
In 2016, Gemini organized the first-ever daily BTC auction. Soon, many of its rivals followed suit and such auctions became commonplace.
Hippo
This Palo Alto-based property insurance company was established in 2015 by Asaf Wand and Eyal Navon. The former used to work as an investor for Intel Capital investor and as a consultant for McKinsey. The latter is an entrepreneur with a solid background in R&D and software engineering. His father made a career in the conventional insurance industry. Wand realized he would love to revolutionize this sector after he sold Sabi, his third startup.
Hippo was backed by Felicis Ventures, Lennar, Bond Capital, Mitsui Sumitomo Insurance Company, Comcast Ventures, Fifth Wall Ventures, and Mary Meeker’s Bond Capital. Today, its valuation reaches $5 billion and over 70% of US homeowners can access its services.
This startup’s mission consists in streamlining home insurance apps. It relies on public data, big data, satellite imagery, and AI. Clients can use Hippo to insure their homes and belongings against crimes and accidents. This business avoids intermediaries and sells its services either directly to consumers or through independent insurance brokers.
When Hippo was making its first steps on the market, it emphasized the delivery of a 60-second quote for homeowners insurance policies as its primary competitive edge. Its second benefit was an intuitive and transparent online purchase process. Besides, potential customers were informed about smart home sensors that could proactively detect and prevent damage to the insured property.
In 2019, Hippo acquired Sheltr under undisclosed conditions. This business specializes in home wellness checkups.
BlockFi
Unlike most other startups from our best fintech companies list, the Jersey City-based BlockFi targets its services at users with an intermediate-to-advanced level of expertise. Flori Marquez and Zac Prince launched this startup in 2017 and now, its valuation exceeds $3 billion.
On this platform, users can buy, sell, and trade crypto as well as earn interest on it and request low-interest loans. The annual interest rate might reach 8%. Clients with interest accounts are allowed to set up recurring trades that take place daily, weekly, or every two weeks (most rival platforms lack this feature). The bad news is that US residents can’t currently open interest accounts because this service has not been registered under the Securities Act of 1933.
On the one hand, BlockFi is not beginner-friendly and lacks video explainers. On the other hand, it features a comprehensive help center where individuals with limited experience can get the necessary knowledge. Experienced traders characterize its interface as intuitive. This refers both to the browser version of BlockFi and its mobile app for iOS and Android.
It’s a holistic crypto ecosystem with over $10 billion in assets and over 1 million verified users. To be allowed to issue a BlockFi Rewards Signature Visa crypto rewards credit card, an applicant will most probably need to have a 680 credit score.
Clients don’t need to pay a fee for trading — but there are fees for withdrawing funds and withdrawal limits. The rules vary depending on which currency you use. Some currencies will charge you a fee for every withdrawal. Others will let you make withdrawals once per month.
While many of its competitors support over a hundred cryptocurrencies, BlockFi works only with 13 of them. Some choices seem obvious, such as BTC, ETH, LTC, and USDT. Others are less popular but were hand-picked by the platform’s experts nevertheless — such as DAI, LINK, or PAXG. The funds are stored in cold wallets.
Final thoughts
Hopefully, now you have a better understanding of how the best fintech companies 2022 operate in the US. All the startups from our list are based on innovative ideas, efficiently fill in market gaps, and have highly motivated teams. In the future, they will be likely to expand further and generate even more profits.
