How Fintech Clair Hit A $100M Run Rate By Offering Workers The 'Fairest' Early Access To Wages
CEO Nico Simko spent years cracking a business model he says can provide better access to credit for millions of working Americans. Now it's growing 10x.
The Upshot
On the website of Nico Simko’s startup, Clair, you’ll find an unusual stat: percentage of U.S. businesses that offer his company’s on-demand pay solution to their employees. As of mid-August, it hovers above 5%.
“That’s a huge milestone for us,” Simko says. “But the goal is to get to at least 20% over the next few years.”
In less than two years in the market, Clair has grown fast. Those 300,000 businesses translate to about double that in monthly active users. Recently, the volume of wage advances passing through the fintech startup reached an annualized run rate of $2 billion.
And for Clair, that means the startup has reached a run rate of $100 million in revenue, up 10x from just over a year ago, Simko tells Upstarts. Clair also reached positive cash flow this year, the company says.
Clair is making that money by offering early access to unpaid, earned wages to workers at these businesses, which can range from mom-and-pop operations to ones with national footprints. But Clair is different from other solutions in the market for two big reasons: it’s not a payday lender playing an interest game; and it’s not a consumer app, but instead works through payroll and workforce platforms, like Gusto, QuickBooks and TriNet.
“It’s much more efficient, it’s cheaper, and the bucket is less leaky,” Simko argues. “And people have more disposable money at the end of the month.”
Founded in 2020, by Simko, Alex Kostecki and Erich Nussbaumer, and named after the French word for “clear,” Clair’s initial product looked very different, and it didn’t work out.
But more recently, Clair’s unusual embedded infrastructure model – reminiscent in some ways of Plaid, or its co-founder William Hockey’s bootstrapped second act, Column – has seemingly pulled off a highwire act between making corporate partners like Gusto happy, and providing a service that profits off employees needing fast money, without devolving into exploitation.
Clair knows you might be skeptical about the altruism behind a for-profit, venture-backed startup. Clair has raised $69 million in funding to date, most recently a Series B last year, from investors including Founder Collective, Thrive Capital and Upfront Ventures.
So the startup’s got data: out of more than 37,000 responses to its in-widget customer satisfaction survey over the past 90 days, 89% said they were “very satisfied” or “satisfied,” notes Erik Webb, Clair’s vice president of data and growth.
And for Simko, who launched Clair out of personal experience as an immigrant student in the U.S., Clair represents a personal mission that he would walk away from if it became just about the dollars, he insists.
“At the end of the day, I believe that this is a product that you should graduate from,” he says.
More on how Clair found product-market fit, why partners like Gusto call it “extremely well loved,” and why Simko thinks you should be rooting for his mission, below.
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