Credit Karma

Credit Karma is a free credit and financial management platform for US consumers available on the web and major mobile platforms. Founded in 2007, it provides free weekly updated credit scores and credit reports from national credit bureaus TransUnion and Equifax, alongside daily credit monitoring from TransUnion.[2]

Credit Karma also provides credit tools, such as a Credit Score Simulator, which simulates the effect of potential financial actions on a user’s credit score; and tailored financial recommendations based on each individual user’s credit profile.

In addition to its free credit reports and tools, Credit Karma offers a My Spending Tool through account aggregation service Yodlee, which allows users to track their credit card, loan transactions and balances in Credit Karma’s interface. Credit Karma also hosts user forums for financial product reviews and credit advice, and provides calculator tools for debt repayment, amortization, home affordability and simple loans.

As of April 2015 Credit Karma has over 35 million members[3] and 250 employees.

Founder and investors

Kenneth Lin, who previously founded Multilytics Marketing and worked with E-Loan and Upromise,[5] launched Credit Karma in 2007, with the website going live in February 2008.[6] Early investors include Chris Larson, CEO of Prosper, and Mark Lefanowicz, former president of E-Loan.[7]

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.[8] In 2013, Credit Karma secured $30 million in Series B funding led by Ribbit Capital and Susquehanna Growth Equity.[9] In March 2014, Credit Karma raised $85 million in Series C financing, led by Google Capital with participation from Tiger Global Management and existing investors.[10] The company followed that with $75 million in follow on funding in September 2014 from Google Capital, Tiger Global Management and Susquehanna Growth Equity.

To date, Credit Karma has raised $368.5 million in financing, at a valuation of $3.5 billion.

Kenneth Lin (entrepreneur)

Kenneth Lin is an American tech entrepreneur. Founded in 2007, his best known business is Credit Karma, an online credit score monitoring service, and continues to serves as CEO. In a magazine profile he has according to Forbes “forever changed the way Americans interact with their credit”.

Early life and career

He emigrated at the age of 4 with his parents from China to the United States.[1] His parents worked working class jobs at casinos and restaurants to pay his tuition to attend Boston University.[1] In the late 1990s, Lin worked in the credit card industry.[2] He had previously founded Multilytics Marketing, a data driven marketing agency.

Credit Karma

Lin has said the inspiration for Credit Karma began in 2006 when he was discouraged by the cost of obtaining his credit score and sought to create an alternative.[3] Credit Karma was established to provide free credit scores and proved to be a hit growing according to the company to over 40 million users by 2015.[4] Lin has sought to expand the offerings of the website by including analytical tools and calculators, credit monitoring, education videos, and other tools.[5] In an interview with the American Banker, he said the “ultimate goal” was to make the credit process more simple with the aim of being “able to make the application process two or three clicks instead of 20 or 30 minutes.”

In raising venture capital funding, the company has also performed well, reaching a valuation of $3.5 billion according to Fortune magazine.[6] Although successful in finding investors, Lin has expressed a desire to avoid quickly taking the company public. In a column penned for Fast Company he wrote about a litany of negatives associated with an IPO. His column especially focused on the downsides of “quarterly scrutiny” endured by public companies which would get in the way of the “slow and steady implementation” he wanted.