Fintech Varo receives an additional $29 million in funding and appoints new CEO

Fintech company Varo has been in the process of raising a Series G funding round of $55 million. While they have managed to secure $29 million so far, they have not reached their intended goal. Since its establishment in 2015, Varo has successfully raised over $1 billion in funding, as reported by PitchBook. The recent round of funding was covered by Fintech Business Weekly author Jason Mikula and Crowdfund Insider.

Unforeseen circumstances have led to challenges in Varo’s fundraising efforts in the past. In 2023, they raised $50 million in equity at a lower valuation of $1.85 billion post-money compared to their previous round in 2021. The 2021 round was valued at $2.5 billion post-money, according to PitchBook. In a surprising turn of events, CEO and founder Colin Walsh announced his resignation, with Gavin Michael taking over as the new chief executive. Michael, who previously served as the CEO of Bakkt, assumed his role at Varo in November 2024.

Speculation arose regarding Walsh’s departure, with some suggesting he was forced to resign. However, a company spokesperson dismissed these claims, stating that the transition marked a new phase in Varo’s evolution. Michael’s extensive experience, including leadership roles at Citi and JPMorgan Chase, is believed to be instrumental in driving Varo forward. Walsh will continue to be part of Varo’s board and holds a substantial stake in the company as a founder.

Varo made waves in the fintech industry in 2020 when it became the first all-digital nationally chartered U.S. consumer bank. Despite early successes, Varo has not yet achieved profitability as of early 2024, reporting a loss of nearly $65 million in a December 2024 call report. The company aims to maintain its commitment to financial inclusion under Michael’s leadership.

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