Clerkie, a fintech providing debt repayment and optimization technology for lenders, announced a $33 million Series A round led by Left Lane Capital on Tuesday.
San Francisco-based Clerkie will use the funds to grow its engineering team and to rapidly scale its debt workout solutions to both help more borrowers and support more partners.
“The consumer debt market is fundamentally broken for consumers and the creditors that serve them, as evidenced by the predatory collections practices and the crushing amount of debt burdening American families,” said Clerkie CEO Guy Assad, who founded the company in 2018 alongside co-founders CTO Sebastian Wigstrom, and COO Gray Hoffman.
Clerkie also caught the attention of Nubank founder David Velez and Intuit founder Tom Proulx in its Series A round; and other participating investors include Wellington Management Company, Flourish Ventures, Citi Ventures, CMFG Ventures and Vestigo Ventures.
“Today, tens of millions of Americans are struggling with their debts and are falling into delinquency. It’s a lose-lose situation for the borrowers and for the banks who are racking up billions in losses,” Assad said. “Our goal is to support struggling American families by giving them better tools to responsibly fulfill their debt obligations and ease their debt burden.”
Assad’s focus on a solution for debt is deeply personal, inspired by his family’s experience of medical debt and credit card bills tied into his father’s battle with cancer. After his father succumbed to his illness, Assad was left to navigate the resultant debt, negotiating repayment options with medical providers and collection agencies.
In 2018, Assad, Wigstrom, and Hoffman saw that they could help borrowers pay off debts and avoid delinquency if the infrastructure was modernized and automated.
“[B]orrowers needed guidance tailored to their specific financial needs and that guidance has to be easily executable and automated”, Assad said.
With this intention, they developed Clerkie, which uses data to identify and help potentially delinquent borrowers avoid default. The system presents borrowers with viable workout options with the goal of helping them avoid the collections process and lessen their debt in the long run.
“As consumer debt delinquency rises, we believe technology that makes the lending system more efficient and effective for all parties will be critical,” said Dan Ahrens, managing partner at Left Lane Capital, in a prepared statement. “The Clerkie team's deep subject matter expertise and commitment to making this process as constructive and beneficial as possible to the consumer stood out. We believe in that mission and look forward to being part of the journey.”
Emmalyn Shaw, managing partner at Flourish Ventures, said in a prepared statement, “With interest rates going up to a level not seen in approximately 20 years, significantly more Americans are at risk and the level of delinquent consumer debt is likely to exceed $130B. Clerkie’s debt automation platform is needed more now than ever and enables a true win-win outcome for lenders and borrowers alike.”
To date, Clerkie has raised $41 million.