Credit Karma

Credit Karma is an American multinational personal finance company, founded on March 8, 2007,[3] by Kenneth Lin, Ryan Graciano and Nichole Mustard.[4] It is best known as a free credit and financial management platform, but its features also include free tax preparation, monitoring of unclaimed property databases[5] and a tool to identify and dispute credit report errors.[6] The company operates in the United States, Canada and the United Kingdom.

Credit Karma, Inc.
Private
IndustryPersonal finance, Software, Financial technology
FoundedMarch 8, 2007 (2007-03-08)
Founders
HeadquartersSan Francisco, California, U.S.
Key people
Products
  • Credit scores
  • Credit reports
  • Credit monitoring
  • Tax preparation
RevenueUS$370 million (2015), over US$500 million (2016)[1]
Number of employees
700[2]
WebsiteCreditKarma.com

All of Credit Karma’s services are free to consumers.[7] Revenue from targeted advertisements for financial products offsets the costs of its free products and services. Credit Karma earns revenue from lenders, who pay the company when Credit Karma successfully recommends customers to the lenders.[8]

On February 24, 2020, Intuit announced that it planned to acquire Credit Karma for $7.1 billion.[9]

Products and services

Credit Karma provides free credit scores and credit reports from national credit bureaus TransUnion and Equifax, alongside daily credit monitoring from TransUnion.

Credit Karma also provides tax filling,[1] loans, credit card, ID Theft Protection, credit tools, such as a Credit Score Simulator, which simulates the effect of potential financial actions on a user's credit score;[10] and tailored financial recommendations based on each individual user's credit profile.

Credit Karma Tax, its free tax filing service, was announced in December 2016.[11] Credit Karma Tax does not participate in the Free File Alliance,[12] and so is not bound by its requirements to restrict eligibility for free filing.[13] The company's primary competitors in this area are TaxAct, TurboTax and H&R Block.[2]

On May 9, 2017, Credit Karma launched Unclaimed Money in seven states. The product aims to help users find unclaimed money, such as unclaimed refunds and insurance payouts.[14]

Acquisitions and expansion

On December 30, 2015, Credit Karma acquired mobile notifications app developer Snowball for an undisclosed amount.[15]

On December 7, 2016, Credit Karma acquired AFJC Corporation, owner of OnePriceTaxes.com, to accelerate its entry into the tax preparation market.[1][16] Related to the launch of tax preparation services, the company also increased its workforce and opened offices in Los Angeles and Charlotte, North Carolina.[1]

In 2016, Credit Karma acquired money reclamation service Claimdog.[17]

On March 14, 2018, Credit Karma acquired personal finance company Penny for an undisclosed amount.[18]

On August 16, 2018, Credit Karma acquired mortgage platform Approved for an undisclosed amount.[19]

In May 2019, the customers of the Noddle credit reporting service in the United Kingdom were acquired from TransUnion.[20]

Founder and investors

Kenneth Lin, who previously founded Multilytics Marketing and worked with E-Loan and Upromise,[21] launched Credit Karma in 2007, with the website going live in February 2008.[22] Early investors include Chris Larson, CEO of Prosper, and Mark Lefanowicz, former president of E-Loan.[23]

In November 2009, Credit Karma closed a $2.5 million Series A funding round led by QED Investors with participation from SV Angel, Felicis Ventures and Founders Fund.[24] In 2013, Credit Karma secured $30 million in Series B funding led by Ribbit Capital and Susquehanna Growth Equity.[25] In March 2014, Credit Karma raised $85 million in Series C financing, led by CapitalG with participation from Tiger Global Management and existing investors.[26] The company followed that with $75 million in follow on funding in September 2014 from CapitalG, Tiger Global Management and Susquehanna Growth Equity.[27]

As of 2015, Credit Karma has raised $368.5 million in financing, at a valuation of $3.5 billion.[28]

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See also

References
  1. Calvey, Mark (27 June 2017). "Why Credit Karma loves taxes". San Francisco Business Times. American City Business Journals. Retrieved 13 July 2020.
  2. Lawler, Ryan (27 June 2017). "Credit Karma touts $500 million in revenues". TechCrunch. Retrieved 13 July 2020.
  3. "CREDIT KARMA, INC. :: OpenCorporates". opencorporates.com. Retrieved 2018-12-25.
  4. "About Credit Karma | Credit Karma". www.creditkarma.com. Retrieved 2017-03-24.
  5. Lawler, Ryan. "Credit Karma now helps users find unclaimed cash". TechCrunch. Retrieved 2017-05-09.
  6. Popper, Nathaniel (2016-12-07). "Automated Assistants Will Soon Make a Bid for Your Finances". The New York Times. ISSN 0362-4331. Retrieved 2017-03-24.
  7. Vance, Ashlee (2014-07-30). "A Free Credit Report With No Strings Attached. Honest". Bloomberg Businessweek. Retrieved 2014-11-04.
  8. "How it Works". Credit Karma. Archived from the original on 2016-09-16. Retrieved 2016-09-21. If you get a product through one of our recommendations, the bank or lender pays us.
  9. Lunden, Ingrid (February 24, 2020). "Intuit confirms that it is buying Credit Karma for $7.1B in cash and stock". TechCrunch. Retrieved February 24, 2020.
  10. Kim, Jane J. (2009-10-08). "Credit Scores: Can You Get Them Free?". Wall Street Journal. ISSN 0099-9660. Retrieved 2017-05-09.
  11. "Credit Karma's Lin: The Goal Is To Make Financial Services Frictionless". CB Insights - Blog. 2017-06-28. Retrieved 2017-06-30.
  12. Paul Kiel, Justin Elliott (2020-02-28). "TurboTax's Bid to Buy Free Tax Prep Competitor Might Violate Antitrust Law, Experts Say". ProPublica. Retrieved 2020-03-02.
  13. Justin Elliott, Paul Kiel (2019-10-17). "Inside TurboTax's 20-Year Fight to Stop Americans From Filing Their Taxes for Free". ProPublica. Retrieved 2020-02-20.
  14. Lawler, Ryan. "Credit Karma now helps users find unclaimed cash". TechCrunch. Retrieved 2 June 2017.
  15. "Credit Karma Acquires Innovative Mobile Notifications Startup Snowball". TechCrunch. Retrieved 2018-08-16.
  16. Rudegeair, Peter (2016-12-07). "Credit Karma Hopes to Score on Tax Preparation". WSJ. Retrieved 2018-08-16.
  17. "Credit Karma now helps users find unclaimed cash". TechCrunch. Retrieved 2018-08-16.
  18. "Credit Karma has acquired an instant message bot, Penny, that helps people track their spending". Recode. Retrieved 2018-08-16.
  19. "Credit Karma acquires mortgage platform Approved". TechCrunch. Retrieved 2018-08-16.
  20. "Credit score firm Noddle tries to rival Experian". Which? News. 2019-05-07. Retrieved 2020-08-09.
  21. ""Kenneth Lin", LinkedIn".
  22. Kincaid, Jason (2009-11-04). "Credit Karma Raises $2.5 Million To Take The Mystery Out Of Credit Scores". TechCrunch. Retrieved 4 April 2015.
  23. Levinson, Rick (2009-06-09). "Credit Karma Introduces Free Credit-Card, Debt-Tracking Tool". Bloomberg L.P. Archived from the original on 2012-01-12. Retrieved 2009-07-27.
  24. Kincaid, Jason (2009-11-04). "Credit Karma Raises $2.5 Million To Take The Mystery Out Of Credit Scores". TechCrunch. Archived from the original on 2012-01-12. Retrieved 2010-09-02.
  25. "Credit Karma Secures $30 Million In Series B Funding". Credit Karma. 2013-04-02. Retrieved 2014-11-04.
  26. Shieber, Jonathan (2014-03-12). "Credit Karma Confirms New $85M Financing Round Led By Google Capital". TechCrunch. Retrieved 2014-05-21.
  27. Perez, Sarah. "Free Consumer Credit Monitoring Company Credit Karma Raises $75M, Now Valued At Over $1 Billion". TechCrunch. Retrieved 2017-10-11.
  28. Sharf, Samantha. "Credit Karma Raises $175 Million At $3.5 Billion Valuation". Forbes. Retrieved June 1, 2015.
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