Branch is synonymous with its platform for enabling flexible workforce payments. It is raising $48 million in funding (Series B round) and finalizing a credit facility of $500 million as well. Lee Fixel-backed Addition (the backer of Stripe, Flipkart, and Coinbase) is the lead investor with equity funding, while the credit facility comes from bought-assets with funds under the management of Neuberger Berman.
Other equity funding round participants include Bonfire Ventures, Drive Capital, Matchstick Ventures, Crosscut Ventures, and HR Tech Investments LLC (owned by Recruit Holdings Co, Ltd. which is an Indeed affiliate). Branch has now raised $58 million in equity since its launch in 2015, and is headquartered in Minneapolis. The latest funding round follows the last one in 2017. The Founder and CEO, Atif Siddiqi, has not released the latest valuation. However, the company has increased its revenues by 300% (year-on-year) for 2020, while achieving 700% growth in the enterprise count on its innovative platform.
Branch offers a more affordable and swifter method of payments for contractors and employees as far as companies are concerned. This also helps in drawing and retaining better talent, while saving more money in comparison to the usage of conventional methods of payment. Siddiqi began the journey with Branch emphasizing enabling workers to take extra hours at their existing companies, for earning more income. However, then the team saw opportunities for helping workers financially in several other ways as well. Siddiqi states that the company could link to several enterprise frameworks, while gathering interesting data on employment, helping it understand how to develop a superior financial service experience for this target consumer.
Branch mainly works for low and mid-income customers, while being an interface between worker payments and companies. It offers earned-wage access, along with accelerating worker payments, and digital tip payments as well. Siddiqi provides an example where several franchisees of Domino’s did not have sufficient cash at the end of each business day for tipping drivers. Instead of venturing to ATMs for getting money, they could use the Branch Wallet for real-time tip payments to drivers completing shifts. Tips make up roughly 40% of the income of a driver every month and are essential as a result.
Branch is also into contractor payment solutions, enabling companies to make swifter payments, with improved experiences across the board. Siddiqi also states that the company is attempting to offer free choices including zero charges for Branch Wallet instant transfers, and so on. The company primarily earns revenues from interchange costs and transaction fees for pushing funds to financial accounts from Branch Wallets.
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