SteadyPay raises £2.9m for gig economy pay support
SteadyPay, the FCA licenced app solving the issue of volatile pay in the growing gig economy, today announced that it has closed a £2.9m seed equity and debt funding round, with the equity investment led by venture firm Hambro Perks and Fair By Design, the social impact fund by Ascension Ventures.
Hambro Perks backs and builds leading technology companies and with its recent investment, Elena Moneta, Principal at Hambro Perks, joins SteadyPay as a Director. The investment will enable the company to scale up in the UK and reach 5,000 customers in the next 12 months.
Launched in 2018, SteadyPay is a smart solution for gig economy workers to protect their pay. A subscription-based app, it automatically tops up workers’ bank accounts when their earnings are below average and allows customers to repay over easy and interest-free instalments.
A third of workers in the UK are currently in ‘atypical employment’. Half of the total workforce will be engaged in some form of independent work in the next five years, and more millennials and Gen Zs want to become their own bosses. SteadyPay is providing a powerful solution to an issue that will affect an increasing number of freelance and contract workers in the UK.
Going direct to consumer rather than working with employers, SteadyPay maintains the relationship with its customers throughout their employment journeys. This is a viable solution for the modern worker who will have a number of employers throughout their career, as well as giving the employee privacy on their financial situation.
SteadyPay owns its relationship with the customer, meaning the company hopes it will quickly become the go-to financial service provider for the gig economy. It uses open banking and has developed a bespoke credit decision engine, which is used to better understand and accept the creditworthiness in the growing industry of gig economy workers, who can often be excluded by traditional credit providers.
For over 50% of workers in the UK, financial uncertainty is one of the prime reasons for stress. Banks and other lenders are often complicated, expensive and inaccessible for gig economy workers, adding to financial strain.
SteadyPay aims to reduce the risk of gig economy workers falling into a debt spiral. The app reduces the need for them to use high-cost credit for everyday expenses or to divert their savings. There is also never any interest added, which further adds to SteadyPay’s ethical solution to the growing problem of volatile pay. With a transparent weekly subscription cost, the company maintains an honest and clear model for its customers that avoid any difficulty of calculating and budgeting for interest and repayments.
John Downie, co-founder and CEO of SteadyPay, said: “We’re delighted to have Hambro Perks and Ascension Ventures leading SteadyPay’s latest funding round. This raise will further strengthen our commitment to service the UK’s gig economy with a powerful and ethical solution to income volatility. We’re thrilled with the results and customer feedback to date, and we look forward to driving scale in 2020.”
Elena Moneta, Principal of Hambro Perks and Director of SteadyPay, added: “Hambro Perks is thrilled to support SteadyPay in its mission to help gig economy workers overcome the hurdles of volatile pay. For the increasing number of gig and self-employed workers, having access to a simple and ethical solution to address the financial complexities that come with such work is key. As the company engages with its customers directly, we believe it will become the go-to financial partner for atypical workers.”
Fair By Design Investment Manager, Emma Steele, said: "We are very excited to bring on SteadyPay as another vital solution to the 'poverty premium'. Along with the other solutions in the portfolio, SteadyPay solves a very important societal issue. By enabling freelancers and gig workers to have access to a more predictable income stream through their income top-up tool, we believe SteadyPay addresses a key aspect of financial vulnerability. We look forward to working with the team to support them on their journey to scale."
Founded in 2017, SteadyPay has nine full-time employees. Established in the UK, the company is utilising the booming FinTech industry in the country, especially amongst Hambro Perks’ eclectic portfolio of FinTech startups and their expertise in this space.
SteadyPay is a smart application of open banking and has two FCA licenses; Consumer Credit and Payment Services, to carry out payment and consumer credit activities, eliminating any regulatory risk.