CommonBond Secures $50M Series D Equity Round, Led by Fifth Third Bancorp
CommonBond, a leading financial technology company that empowers students and graduates to pay for higher education, today announced a $50M Series D financing round.
Fifth Third Capital Holdings, LLC, a wholly-owned subsidiary of Fifth Third Bancorp (NASDAQ: FITB), led the round, with First Republic Bank (NYSE: FRC) and Columbia Seligman Investments also participating, in addition to existing investors including Neuberger Berman, August Capital, and Nyca Partners. Individual investors in CommonBond include Vikram Pandit, former CEO of Citigroup, and Tom Glocer, former CEO of Thomson Reuters. This latest round brings CommonBond’s total funding raised to over $130M. CommonBond will use this new funding to accelerate its growth and invest further in technology.
“This round of equity powers our expansion as a leader in fintech, enabling more ways for us to improve the financial health of our members,” said David Klein, CommonBond CEO and co-founder. “We’ve set out to build a great company for the long term by focusing on the fundamentals – exceptional customer experience, best-in-class technology, and a culture of respect and discipline. I’m incredibly proud of the team for maintaining maniacal focus on our customers and broader stakeholders, positioning the company exceedingly well to continue scaling on behalf of our members.”
In February, Fast Company named CommonBond one of the World’s 50 Most Innovative Companies, and the most innovative company in education.
“At Fifth Third, we recognize that student debt is the number one challenge our millennial customers face,” said Tim Spence, head of payments, strategy, and digital solutions at Fifth Third Bank. “CommonBond has built an industry-leading digital proposition that delivers a memorable experience and helps its members save thousands on their student loans so they can finance their dreams. We are pleased to support CommonBond’s continued growth and look forward to working with them to bring powerful capabilities to market.”
CommonBond is the only company in the United States to offer a complete suite of student loan solutions, including: refinance loans for graduates, new loans for current students, and student loan benefits for employees through its CommonBond for Business™ platform. To date, the company has funded over $1.5B in loans and signed more than 200 CommonBond for Business partners.
“We are proud to support an outstanding innovator in finance,” said Jim Herbert, chairman and CEO (founder) of First Republic Bank. “And we look forward to CommonBond’s continued advancement in this space.”
This funding follows significant growth for CommonBond. In 2017, the company experienced 250 percent revenue growth year-over-year and surpassed its net income target by millions of dollars. Through the end of 2017, CommonBond had experienced only two credit defaults. To date, the company has secured over $3B in lending capacity, and most recently, closed its first AAA-rated securitization. Additionally, through CommonBond’s industry-first “one-for-one” social mission, the company has donated over $800,000 to nonprofit partner Pencils of Promise to fund the education of children in need.
Bank of America Merrill Lynch acted as the exclusive advisor to CommonBond on the transaction.