Green Dot, the market leader in pre-paid Visa/ Mastercard was funded by the Tech Coast Angels in 2001 followed by a Series A in the round in 2003 from Sequoia Capital. Sequoia followed up with a Series B round in December of 2006 where the company raised a further $20M.
Green Dot sells reloadable, prepaid cards at retail locations around the country, such as Rite Aid. Though originally conceived as a card for parents to give to their kids when they went to college, the card has found wide acceptance in many immigrant communities where there is a high demand for virtual cash, as well as with the large sub-par credit market, which does not have access to traditional credit cards.
The strength of GreenDot has been its strong distribution system. In a market where the usefulness of the card depends very much on the proximity of the closed reloading station, Green Dot, with its 150,000+ retail locations in the country is far ahead of the its competitors. The Amigo money card has a much smaller but strong base in the US Spanish speaking population, as well as a large network in South America.
With Green Dot already having a commanding 90% market share in the prepaid business, one can only speculate that the latest cash infusion will mean expansion overseas, where a pre-paid product that allows customers to buy over the internet would be very welcome.
Company: Green Dot
CEO: Steven Streit
Funding Raised: $20M+
Investors: Sequoia Capital, Tech Coast Angels