Caribou Financial Inc. CEO Kevin Bennett says he's betting on big growth for his auto refinance company despite uncertainty and inflation battering consumers. Now the company has a new stack of funding and an impressive status as it stretches to reach new heights.
With an oversubscribed Series C funding round, Caribou raised $115 million in new financing led by Goldman Sachs, it announced Friday. The round values the company at $1.1 billion, making it Greater Washington's newest unicorn — meaning a company valued at more than $1 billion.
The new funding round is also an indication that investors “are confident in our ability to deliver for the market [and] to deliver to consumers even in a time of market volatility,” Bennett said in an interview.
And while rising interest rates, inflation and economic uncertainty could be interpreted as a threat to the D.C. startup, which said it’s saved customers $100 million in aggregate over the lifetime of their car loans, the company doesn’t see it that way. “With prices going up, consumers are looking for ways to save money,” Bennett said. “So, we think there’ll be even more demand and the product will be even more important to consumers across the country.”
The D.C. startup began as an auto-refinancing company and added an online car insurance marketplace product in October. With the new funding, the company will keep investing in new products and services, Bennett said. It will continue to add new areas to its insurance marketplace and launch new partners and offers within that, he said. Separately, the company has “a bunch of new products in R&D, but nothing we’re ready to announce yet,” Bennett said. Those other products fall under the company goal of “help[ing] consumers use their car as a way to improve their financial life,” the CEO said.
To build out its offerings, it’ll continue to invest in hiring, “aggressively” Bennett said, although he declined to share a target. In the last two years Caribou has grown from around 40 employees to about 500. Future hiring will happen across the business, from product to engineering, marketing and lending, the firm said. It’ll also keep “building out talent and top talent,” Bennett said. Earlier this year the firm added substantially to its management team, hiring a chief lending officer, chief compliance officer, chief accounting officer and more, as well as two new board members.
Caribou has offices in D.C., Denver and Austin, Texas, and moved into a larger space in the District from Arlington last year. As it continues to grow its headcount, it will “have more to say on [space considerations] at some point,” Bennett said, although he declined to share thoughts on any changes to the company’s 22,000-square-foot-lease at 1717 Rhode Island Ave. NW.
Incubated in 2017 by local venture firm QED Investors, Caribou rebranded from MotoRefi in November. The company has been growing exponentially; it quadrupled revenue in 2020 and again in 2021, it previously said. Bennett declined to share current revenue and wouldn’t say whether the company was profitable yet. But its current focus is to keep growing, the CEO said, adding that “we’ll cross other bridges when we come to them.”
