It started 2022 with about 500 employees. The company has also made a concerted effort to cut costs, conducting more than one layoff in the past year. Today, Stash has 2 million active subscribers that the company says have collectively set aside nearly $3 billion in savings over time. “The number of subscribers is about the same because we’ve been constraining growth.” “Our run rate hasn’t exceeded the pace of growth that we were originally targeting at the beginning of the year,” she added. Specifically, she said, Stash ended 2022 “just a little bit north of 50% gross margin.” Landsman told TechCrunch that the company was projecting to end 2023 with a nearly 75% growth margin. “While we were a little bit shy of that mark, we have at the same time, continued to grow at a healthy clip and improved the gross margin of the business substantially.” “That was a very purposeful choice that we…made in the current market - to focus on a better balance of growth and profitability,” Landsman told TechCrunch in an interview. It actually ended the year “a little bit down from that,” according to Landsman. Last October, the company had said it expected to surpass $125 million in annual revenue. The company has now raised about $550 million in equity and debt since its 2015 inception. A mix of new and existing backers also participated in the latest financing, including Union Square Ventures and Goodwater Capital. Stash last raised a venture round in 2021 - a $125 million raise at a $1.4 billion valuation. Stash is on its way to becoming profitable by the end of 2024, according to Landsman. “We didn’t want to do a priced round because of the volatility in the market - and because of our proximity to profitability, we didn’t have to do it,” she added. Stash intentionally opted not to raise more capital via the venture route in large part due to market conditions. “This new capital puts us in a position to be public market ready… to be a thriving, profitable and private market company so that we’re not subject to the whims of where the public market finds itself.” Why it chose to skip venture capital “An audit function that has independent oversight for the company is a critical path for any company, but if you happen to be in consumer fintech, it’s twice as critical,” said Landsman, who joined New York-based Stash in February after spending five years as a partner at venture firm NEA. As part of that effort, the company also announced today that Amy Butte, former CFO of the New York Stock Exchange, has been tapped to serve as its first independent audit chair. Firms that make loans in this way typically have the option of either making interest off the loans or to convert these loans into equity by purchasing warrants, which have a discount on the stock.Įither way, Landsman describes the move as a win for Stash, a startup that aims to offers lower and middle income consumers an affordable way to invest, and has aspirations to go public in the relatively near future. Startups like using them because as CEO Liza Landsman explained it in the case of Stash, it gives the company “the runway to get to profitability without a valuation.” At the same time, convertible notes underscore that investors in this current market have the upper hand. Convertible notes, also known as a convertible debt, are essentially short-term loans that may later be converted to equity.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |