Credit Karma

Last updated

Credit Karma, Inc.
Company type Subsidiary
Industry Personal finance, Software, Financial technology
FoundedMarch 8, 2007;16 years ago (2007-03-08)
Founders
Headquarters Oakland, California, U.S.
Products
Revenue$500 million (2017, estimated) [1]
Number of employees
1,500 [2]
Parent
Website CreditKarma.com

Credit Karma is an American multinational personal finance company founded in 2007. It has been a brand of Intuit since December 2020. [3] It is best known as a free credit and financial management platform, but its features also include monitoring of unclaimed property databases and a tool to identify and dispute credit report errors. [4] The company operates in the United States, Canada and the United Kingdom. [3]

Contents

All of Credit Karma's services are free to consumers. [5] Revenue from targeted advertisements for financial products offsets the costs of its free products and services. Credit Karma earns revenue from lenders, who pay the company when Credit Karma successfully recommends customers to the lenders. [6]

History

Kenneth Lin, who previously founded Multilytics Marketing and worked with E-Loan and Upromise, [7] launched Credit Karma in 2007 [8] with co-founders Ryan Graciano and Nichole Mustard. [9] The website went live in February 2008. [10] Early investors included Chris Larson, CEO of Prosper, and Mark Lefanowicz, former president of E-Loan. [11]

In November 2009, Credit Karma closed a $2.5 million Series A funding round led by QED Investors with participation from SV Angel, Felicis Ventures and Founders Fund. [10] In 2013, Credit Karma secured $30 million in Series B funding led by Ribbit Capital and Susquehanna Growth Equity. [12]

In March 2014, Credit Karma raised $85 million in Series C financing, led by CapitalG with participation from Tiger Global Management and existing investors. [13] The company followed that with $75 million in follow on funding in September 2014 from CapitalG, Tiger Global Management and Susquehanna Growth Equity. [14]

In December 2015, Credit Karma acquired mobile notifications app developer Snowball for an undisclosed amount. [15] As of 2015, Credit Karma had raised $368.5 million in financing, at a valuation of $3.5 billion. [16]

In 2016, Credit Karma acquired money reclamation service Claimdog. [17] In December 2016, Credit Karma acquired AFJC Corporation, owner of OnePriceTaxes.com, to accelerate its entry into the tax preparation market. [18] [19] Related to the launch of tax preparation services, the company increased its workforce and opened offices in Los Angeles and Charlotte, North Carolina. [18]

In May 2017, Credit Karma launched Unclaimed Money in seven US states. The product aims to help users find unclaimed money, such as unclaimed refunds and insurance payouts. [17]

In March 2018, Credit Karma acquired personal finance company Penny for an undisclosed amount. [20] In August, it acquired mortgage platform Approved for an undisclosed amount. [21]

In May 2019, the customers of the Noddle credit reporting service in the United Kingdom were acquired from TransUnion. [22]

In December 2020, Intuit acquired Credit Karma for approximately $7.1 billion. The acquisition was initially delayed due to a DOJ antitrust lawsuit but it was finally approved after the company agreed to divest its free tax preparation service, known as Credit Karma Tax, which was a direct competitor to Intuit's TurboTax product. [23] [24]

That same month, Credit Karma announced that it was moving its headquarters across San Francisco Bay from San Francisco to Oakland. [25]

In August 2021, Credit Karma reached an agreement with NBA franchise Houston Rockets to have the company's name appear on the team's jersey's beginning in the 2021 season. [26]

In September 2022, the Federal Trade Commission (FTC) ordered Credit Karma to pay its users $3 million for "false claims" that impacted their credit scores. [27] Nearly one-thirds of pre-approved users who applied for credit cards were eventually denied following a credit check, costing their time and a negative impact to their credit score. Credit Karma reached a settlement with the FTC, and stated that the company is paid only when users are approved for products like credit cards. [27]

In November 2023, Intuit announced that the financial service Mint would be shut down and integrated with Credit Karma in January 2024. [28]

Products and services

Credit Karma provides free credit scores and credit reports in the United States, Canada and United Kingdom from national credit bureaus TransUnion and Equifax, alongside daily credit monitoring from TransUnion.

Credit Karma also provides identity theft protection and credit tools, such as a Credit Score Simulator which simulates the effect of potential financial actions on a user's credit score; [29] and tailored recommendations for credit cards and personal loans.

Credit Karma Tax, its free United States tax filing service, was announced in December 2016. [30] Credit Karma Tax does not participate in the Free File Alliance, [31] and so is not bound by its requirements to restrict eligibility for free filing. [32] The company's primary competitors in this area are TurboTax (also owned by Intuit) TaxAct, and H&R Block. [33] In November 2020, Square, Inc. announced it was acquiring Credit Karma Tax for $50 million and would make it a part of its Cash App unit. [34]

See also

Related Research Articles

<span class="mw-page-title-main">Intuit</span> American financial software company

Intuit Inc. is an American multinational business software company that specializes in financial software. The company is headquartered in Mountain View, California, and the CEO is Sasan Goodarzi. Intuit's products include the tax preparation application TurboTax, personal finance app Mint, the small business accounting program QuickBooks, the credit monitoring service Credit Karma, and email marketing platform Mailchimp. As of 2019, more than 95% of its revenues and earnings come from its activities within the United States.

<span class="mw-page-title-main">TurboTax</span> US tax preparation software

TurboTax is a software package for preparation of American income tax returns, produced by Intuit. TurboTax is a market leader in its product segment, competing with H&R Block Tax Software and TaxAct. TurboTax was developed by Michael A. Chipman of Chipsoft in 1984 and was sold to Intuit in 1993.

The Free File Alliance is a group of tax preparation companies which operate a public-private partnership with the Internal Revenue Service (IRS) to provide free electronic tax filing services under the IRS Free File program to United States taxpayers meeting certain guidelines. The IRS stipulates filers must have an adjusted gross income (AGI) of $73,000 or less for tax year 2022 to qualify, but participating companies can set their own requirements and restrictions. The IRS Free File program is a compromise between the IRS and for-profit tax software companies that enables lower and middle-income filers to file their taxes for free while ensuring the IRS does not develop its own free-to-use tax software that would compete with private, for-profit tax software companies.

Tax preparation is the process of preparing tax returns, often income tax returns, often for a person other than the taxpayer, and generally for compensation. Tax preparation may be done by the taxpayer with or without the help of tax preparation software and online services. Tax preparation may also be done by a licensed professional such as an attorney, certified public accountant or enrolled agent, or by an unlicensed tax preparation business. Because United States income tax laws are considered to be complicated, many taxpayers seek outside assistance with taxes.

Mint, also known as Intuit Mint and formerly known as Mint.com, is a personal financial management website and mobile app for the US and Canada produced by Intuit, Inc..

<span class="mw-page-title-main">Xero (company)</span> Accounting software company

Xero is a New Zealand–based technology company that provides cloud-based accounting software for small businesses. The company has offices in New Zealand, Australia, the United Kingdom and the United States. Xero's products are based on the software-as-a-service model and sold by subscription, based on the type and number of entities managed by the subscriber. The products are used in over 180 countries.

<span class="mw-page-title-main">Aaron Patzer</span> American businessman

Aaron Patzer is an Internet entrepreneur and the founder of Mint.com, a financial management tool which was acquired by Intuit and had over 10 million users as of mid-2012.

<span class="mw-page-title-main">Docstoc</span> Defunct electronic document repository and online store

Docstoc was an electronic document repository and online store, aimed at providing professional, financial and legal documents for the business community. It closed in 2015. Users could upload, share and sell their own documents, or purchase professional documents written in-house by professionals and lawyers.

<span class="mw-page-title-main">Outright</span> Accounting software application

Outright was an accounting and bookkeeping software application that assists small businesses and sole proprietors with managing their business's income and expenses. In May 2022, GoDaddy announced the software would be discontinued on June 18, 2022.

<span class="mw-page-title-main">Block, Inc.</span> American financial services company

Block, Inc. is a U.S. public company founded by Jack Dorsey and Jim McKelvey in 2009. It owns various financial technology businesses. As of 2023, Block’s service network reports 51 million users and 4 million merchants, processing payments worth US$203 billion annually.

<span class="mw-page-title-main">Stripe, Inc.</span> Irish-American payment technology company

Stripe, Inc. is an Irish-American multinational financial services and software as a service (SaaS) company dual-headquartered in South San Francisco, California, United States and Dublin, Ireland. The company primarily offers payment-processing software and application programming interfaces for e-commerce websites and mobile applications.

Noddle was a credit report service offered by the British arm of American company TransUnion. The business was launched in 2011 and was sold to Credit Karma in 2019.

NerdWallet is an American personal finance company, founded in 2009 by Tim Chen and Jacob Gibson. It has a website and app that earns money by promoting financial products to its users.

Mailchimp is a marketing automation and email marketing platform. "Mailchimp" is the trade name of its operator, Rocket Science Group, an American company founded in 2001 by Ben Chestnut and Mark Armstrong, with Dan Kurzius joining at a later date.

<span class="mw-page-title-main">Wave Financial</span> Canadian provider of financial software and services for small businesses.

Wave is a company that provides financial services and software for small businesses. Wave is headquartered in the East Bayfront neighborhood in Toronto, Canada.

SoFi Technologies, Inc. is an American online personal finance company and online bank. Based in San Francisco, SoFi provides financial products including student loan refinancing, mortgages, personal loans, credit card, investing, and banking through both mobile app and desktop interfaces.

Personal financial management refers to "ways" or "methods" of managing ones own personal finances. It is also known by its acronym, PFM, which refers to the type of software used for personal finance apps. Simply put, PFM refers to software that helps users manage their money. PFM often lets users categorize transactions and add accounts from multiple institutions into a single view. PFM also typically includes data visualizations such as spending trends, budgets and net worth.

Personal Capital is an online financial advisor and personal wealth management company headquartered in Redwood Shores, CA with offices in San Francisco, CA, Denver, CO, Dallas, TX and Atlanta, GA.

<span class="mw-page-title-main">Kenneth Lin (entrepreneur)</span> American tech entrepreneur

Kenneth Lin is an American tech entrepreneur. His best known business is Credit Karma, an online credit score monitoring service founded in 2007. He continues to serve as its CEO.

Eclipse ERP is a real-time transaction processing accounting software used for order fulfillment, inventory control, accounting, purchasing, and sales. It was created for wholesale distributors in the Electrical, HVAC, Plumbing, and PVF industries, but is used by a wide range of market sectors. At one point this software was called Intuit Eclipse DMS, and Activant Eclipse, and Eclipse Distribution Management System.

References

  1. ↑ "Credit Karma touts $500 million in revenues". TechCrunch. Retrieved December 23, 2021.
  2. ↑ Goldberg, Emma (August 28, 2022). "The Office's Last Stand". The New York Times.
  3. 1 2 "Credit Karma". Forbes. Retrieved May 4, 2021.
  4. ↑ Popper, Nathaniel (December 7, 2016). "Automated Assistants Will Soon Make a Bid for Your Finances". The New York Times. ISSN   0362-4331 . Retrieved March 24, 2017.
  5. ↑ Vance, Ashlee (July 30, 2014). "A Free Credit Report With No Strings Attached. Honest". Bloomberg Businessweek . Retrieved November 4, 2014.
  6. ↑ "How it Works". Credit Karma. Archived from the original on September 16, 2016. Retrieved September 21, 2016. If you get a product through one of our recommendations, the bank or lender pays us.
  7. ↑ ""Kenneth Lin", LinkedIn".
  8. ↑ "CREDIT KARMA, INC. :: OpenCorporates". opencorporates.com. Retrieved December 25, 2018.
  9. ↑ "About Credit Karma". Credit Karma. Archived from the original on January 15, 2008. Retrieved March 24, 2017.
  10. 1 2 Kincaid, Jason (November 4, 2009). "Credit Karma Raises $2.5 Million To Take The Mystery Out Of Credit Scores". TechCrunch. Archived from the original on February 6, 2012. Retrieved September 2, 2010.
  11. ↑ Levinson, Rick (June 9, 2009). "Credit Karma Introduces Free Credit-Card, Debt-Tracking Tool". Bloomberg L.P. Archived from the original on October 25, 2012. Retrieved July 27, 2009.
  12. ↑ "Credit Karma Secures $30 Million In Series B Funding". Credit Karma. April 2, 2013. Retrieved November 4, 2014.
  13. ↑ Shieber, Jonathan (March 12, 2014). "Credit Karma Confirms New $85M Financing Round Led By Google Capital". TechCrunch. Retrieved May 21, 2014.
  14. ↑ Perez, Sarah. "Free Consumer Credit Monitoring Company Credit Karma Raises $75M, Now Valued At Over $1 Billion". TechCrunch. Retrieved October 11, 2017.
  15. ↑ "Credit Karma Acquires Innovative Mobile Notifications Startup Snowball". TechCrunch. Retrieved August 16, 2018.
  16. ↑ Sharf, Samantha. "Credit Karma Raises $175 Million At $3.5 Billion Valuation". Forbes. Retrieved June 1, 2015.
  17. 1 2 "Credit Karma now helps users find unclaimed cash". TechCrunch. Retrieved August 16, 2018.
  18. 1 2 Calvey, Mark (June 27, 2017). "Why Credit Karma loves taxes". San Francisco Business Times. American City Business Journals. Retrieved July 13, 2020.
  19. ↑ Rudegeair, Peter (December 7, 2016). "Credit Karma Hopes to Score on Tax Preparation" . WSJ. Archived from the original on December 8, 2016. Retrieved August 16, 2018.
  20. ↑ "Credit Karma has acquired an instant message bot, Penny, that helps people track their spending". Recode. Retrieved August 16, 2018.
  21. ↑ "Credit Karma acquires mortgage platform Approved". TechCrunch. Retrieved August 16, 2018.
  22. ↑ "Credit score firm Noddle tries to rival Experian". Which? News. May 7, 2019. Retrieved August 9, 2020.
  23. ↑ Ponciano, Jonathan. "DOJ Forces Credit Karma To Sell Tax Unit To Square To Clear $7.1 Billion Takeover By Intuit". Forbes. Retrieved May 4, 2021.
  24. ↑ "Justice Department Requires Divestiture of Credit Karma Tax for Intuit to Proceed with Acquisition of Credit Karma". The United States Department of Justice. November 25, 2020.
  25. ↑ Avalos, George (December 14, 2020). "Credit Karma will exit San Francisco and shift HQ to downtown Oakland". The Mercury News. Retrieved January 2, 2023.
  26. ↑ Shelby Stewart, "Houston Rockets Join Forces with Credit Karma Money," Houstonia, August 3, 2021.
  27. 1 2 Jones, Dustin (September 6, 2022). "Credit Karma will pay $3 million to users targeted with false preapproved offers". NPR .
  28. ↑ Ford, Brady (November 1, 2023). "Intuit Is Closing Personal-Finance App Mint, Shifts Users to Credit Karma". Bloomberg News.
  29. ↑ Kim, Jane J. (October 8, 2009). "Credit Scores: Can You Get Them Free?". Wall Street Journal. ISSN   0099-9660 . Retrieved May 9, 2017.
  30. ↑ "Credit Karma's Lin: The Goal Is To Make Financial Services Frictionless". CB Insights - Blog. June 28, 2017. Retrieved June 30, 2017.
  31. ↑ Paul Kiel, Justin Elliott (February 28, 2020). "TurboTax's Bid to Buy Free Tax Prep Competitor Might Violate Antitrust Law, Experts Say". ProPublica. Retrieved March 2, 2020.
  32. ↑ Justin Elliott, Paul Kiel (October 17, 2019). "Inside TurboTax's 20-Year Fight to Stop Americans From Filing Their Taxes for Free". ProPublica. Retrieved February 20, 2020.
  33. ↑ Lawler, Ryan (June 27, 2017). "Credit Karma touts $500 million in revenues". TechCrunch. Archived from the original on June 27, 2017. Retrieved July 13, 2020.
  34. ↑ Weil, Dan (November 25, 2020). "Square to Buy Credit Karma Tax for $50 Million, Expanding Reach". TheStreet. Archived from the original on December 6, 2020. Retrieved December 20, 2020.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.