Sunbit

Offering instant, low friction financing for consumers at the point-of-sale

Company: Sunbit builds financial technology for real life. Their technology approves the majority of people who apply and eases the stress of paying for life’s expenses by giving people more options on how and when they pay. Sunbit offers a next-generation no-fee credit card that can be managed through a powerful mobile app, as well as a point-of-sale payment option available at nearly 14,000 service locations, including nearly 40% of U.S. auto dealership service centers, optical practices, thousands of dentist offices, veterinary clinics and specialty healthcare services.

HQ Location & Year Founded: Los Angeles, 2016

Founder: Arad Levertov, Co-founder and CEO, started Sunbit in early 2016 after having been COO of Enova International, an $800 million fintech company with more than 1,000 employees that serves the needs of non-prime consumers and small businesses. He was previously a systems developer at Intel and a Navy Seal in the Israel Defense Forces. Arad graduated in industrial engineering from Ben-Gurion University of the Negev (Israel) and received an MBA from the Fuqua School of Business at Duke University. His co-founders are Ornit Maizel (CTO), Tal Reisenfeld (Head of Sales) and Tamir Hazan (Head of Analytics).

Funds Raised and VC Investors: $210 million from AltaIR Capital, Alumni Ventures, Chicago Ventures, Group 11, G Squared, Heroic Ventures, Migdal Insurance, MORE Investment House, SkyDeck, Starting Line, Transpose Platform Management, Zeev Ventures

❖ Where did the idea for Sunbit originate?

Sunbit was born out of a combination of personal and professional experiences. Professionally, I had moved to the US and started working in the fintech sector with a company that was serving the needs of people who lacked credit. I was also trying as an immigrant to build credit of my own. After having been in the US for two years, I applied for a store credit card at Costco.  I talked to the cashier and provided her with all sorts of personal information that she requested. When the credit check came back, I was declined. It was embarrassing to both the cashier and to me. It turns out that 50% of point-of-sale credit applications get declined. At the time, I worked in a company that provides money upfront to people so that they could shop at places like  Costco. I thought, why not just pay Costco directly, and eliminate the middleman? I connected the dots in my head – like the potential for cost savings for everyone involved – and saw the opportunity for what would become Sunbit.

My goal was to bring innovation, transparency and personalization to the credit world, and turn the traditional business model of charging fees and the high interest rates on its head. And, I wanted to be sure we served as many people as possible.

❖ What is the key problem that Sunbit intends to solve?

Traditionally, companies are built primarily with profit in mind – but my co-founders and I wanted to do something different: to create a drastically more customer-centric, personalized way for people to pay for everyday expenses, so that they could focus on the important things in life. Why shouldn’t a company solve for the customer first?

We believed that if we brought value to everyone in our ecosystem – in our case, customers, service providers, and merchants – that the economic benefits would follow. $1 billion  in transactions later, that has proven to be true.

We are a fintech company for the real world, bridging the gap between things people need to pay for, and the merchant’s ability to give it to them – while cutting out extraneous costs and fees. Sunbit started off meeting people where they were: where unexpected costs often emerged, like the auto parts and service shop, the dentist, the eye doctor. There, we were able to help customers when they needed it, with a point-of-sale solution offering quick credit approval, high approval rates, and the best personalized interest rates we can provide. Providers and merchants make the sale; everybody wins.

Our second product, the Sunbit Card, was created because we wanted to have more of an impact, on more people – it’s the next evolution of our commitment to customer experience. It is a new kind of no-fee credit card with a powerful mobile app that offers customers ultimate control and flexibility on how they want to pay for every single transaction they make – whether they want to pay it in full, or over time. It helps simplify and centralize a lot of what we were hearing a lot of customers tell us they were managing in their heads – when to pay off what, and how.

We have a Net Promoter Score of above 80. While you will not often see customers bragging on Instagram that they just fixed their brakes, or had dental work done, the proof is in the numbers. Sunbit’s there for customers when they need us.  

❖ How are you most differentiated as a service?

One key point of differentiation is on the credit side.

There are some companies that lend money to prime credit customers and then there are others that focus on sub-prime customers, which are basically predatory lenders that charge hundreds of points or more in annualized interest rates. The latter type typically come in the form of payday loans and lease-to-own financing arrangements. In both cases, applications are arduous to fill out and often result in declines.

Our technology delivers experiences with the customer in mind. What we do is use technology that is 10 times faster than applying for a credit card. We take just 30 seconds to have an answer and our point-of-sale product  can approve nine out of ten applications. There simply isn’t another financing technology that does that in-store. It’s not only great for customers, but merchants love it and stick with us.

Likewise with the Sunbit card,  there are no late fees, no penalty fees, no membership fees, no application fees, and no fees to add or remove a transaction from a payment plan. Consumers get next-gen functionality at no cost beyond their personalized interest rate.

Sunbit believes that credit should work for everyone, everywhere --  not just higher-income earners, who already have a lot of options.

❖ What are the company’s key accomplishments to date?

We started the company in 2016 and today offer our point-of-sale service in more than 14,000 locations, a figure that is currently growing by 600-700 per month. We have served over a million customers and completed more than $1 billion in transactions. We also have 70,000 customers who have already used the Sunbit Card, and thousands more on the waiting list.

Our growth has been tremendous, this year we were included in the top 10% of high-growth companies in the US on the Inc. 5000. We also just became certified as a Most Loved Workplace®, with our employees reporting that they feel a sense of ownership and impact.

❖ What lies ahead in the plans for Sunbit?

Sunbit has always built products that serve everyday Americans, and that’s what you should expect to see from us in the future: more customer-centric, life-simplifying products that our customers depend upon.

Remarkably, 85% of merchant sales today of products and services are still brick and mortar and we will expand our offerings to meet the needs of both the customer and the merchant at the point-of-sale, in new and exciting markets

In addition, I am excited about the future of the Sunbit Credit Card. We heard from our million-plus customers: they’re managing many different transactions and forms of payment, all of which can make managing day-to-day finances tough. The Sunbit Card simplifies life by enabling all these types of transactions to be done on a single card.

Regardless of where we go with existing or new products, our underlying promise is to treat each customer or merchant like she was the only customer or merchant for Sunbit -- and to remember that there are real people behind the numbers.  

Ron’s Take

Life is full of unpleasant surprises, including unexpected bills for car repairs, dental work and countless other non-discretionary services. For those times, individuals of modest means and limited savings need to have options that work better than taking out a payday loan at usurious interest rates. Sunbit leverages technology to serve more people than traditional lending institutions and at better rates than what predatory lenders offer. In fact, Sunbit has become a “unicorn” company with a valuation exceeding $1 billion just by serving two of the many markets that exist with point-of-sale purchases. The opportunity to radically transform the access to affordable credit for unexpected expenses is becoming clear and for the taking.

Disclaimer: Alumni Ventures has invested in multiple financing stages of Sunbit, including most recently, the Series D round in mid-2021.