Fintech Varo Secures Additional $29 Million After $1 Billion Funding Round and Announces New CEO

Varo, a prominent player in the fintech sector, is currently in the process of raising a $55 million Series G round. So far, the company has successfully secured $29 million, as indicated by a recent SEC filing. This funding round highlights Varo’s ongoing efforts to strengthen its financial position and expand its offerings.

Varo’s Funding Journey

Since its inception in 2015, Varo has raised over $1 billion in funding, showcasing its growth and potential in the competitive fintech landscape. According to PitchBook, the company experienced fluctuations in its fundraising efforts. For instance, in 2023, Varo completed a $50 million equity round at a valuation of $1.85 billion, which was lower than its previous $510 million Series E round in 2021 that valued the company at $2.5 billion.

Leadership Changes at Varo

In a surprising turn of events, Varo’s CEO and founder, Colin Walsh, announced his resignation recently. Gavin Michael, who previously held the CEO position at the cryptocurrency exchange Bakkt, will take over as the new chief executive. This leadership transition is viewed as essential for Varo’s next phase of growth.

When asked about rumors surrounding Walsh’s departure, a company spokesperson clarified to TechCrunch that, “This transition is about the next phase of Varo’s evolution.” Highlighting Michael’s extensive experience at Citi and JPMorgan Chase, the spokesperson emphasized that he is well-equipped to lead Varo into its next chapter.

Varo’s Commitment to Financial Inclusion

Despite the leadership changes, Walsh will remain on Varo’s board and retains a significant ownership stake in the company. Varo was particularly noteworthy when it became the first all-digital nationally chartered consumer bank in the U.S. in 2020. In a 2022 interview, Walsh expressed optimism about the company’s customer growth and its path to profitability. However, as of early 2024, Varo has yet to achieve profitability, reporting a loss of nearly $65 million in December 2024.

• Founded in 2015, Varo has raised over $1 billion.
• CEO Colin Walsh has stepped down; Gavin Michael is the new CEO.
• Varo became the first all-digital nationally chartered U.S. consumer bank in 2020.
• Reported a loss of nearly $65 million as of early 2024.

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