Honeybee, a startup that aims to help companies provide access to financial support for their employees, announced today that it has raised $ 5.7 million in capital in a round led by FFVC.
Resolute Ventures, Afore Capital, Rebalance Capital, K50 and Financial Venture Studio also participated in the financing, along with two-time NBA star Baron Davis.
HoneyBee has also obtained a $ 100 million line of credit from CIM, an institutional impact investment manager that provides debt capital for innovation lending to underserved communities.
The Los Angeles-based Certified B Corporation describes itself as a B2B fintech company on a mission to provide employees, and their families, with free access to financial support in the workplace as a benefit. That support could come in the form of employer-sponsored “no-cost rainy day funds” and on-demand financial therapy with the goal of “creating a healthier work environment.”
Or put more simply, HoneyBee aims to provide HR and DEI leaders who say they are committed to creating an equitable and inclusive culture, a way to provide access to financial tools and education to help improve the financial health of your employees.
CEO and co-founder Ennie Lim said she was inspired to start HoneyBee after suffering financial setbacks following her own divorce several years ago.
“My credit was negatively affected to the point where I was unable to access any affordable credit,” he recalls. “I wish I had done many things differently, but I didn’t know what I didn’t know and I was embarrassed to ask for help.”
The experience helped Lim realize the importance of feeling in control of his financial life.
“It affects their self-esteem, happiness and personal relationships and made me want to help others take control of theirs,” he said.
Lim teamed up with Benny Yiu and Max Zschoch in 2017 to build HoneyBee with that goal in mind.
“We are solving a huge economic disparity and we are leveling the playing field in the workplace by reducing the financial literacy gap and providing access to credit to the people who need it most,” Lim said. “It is important to recognize that people come from different socioeconomic backgrounds. The different levels of financial illiteracy is a problem that we can no longer ignore ”.
A study conducted by Washington University in St. Louis found that 89% of HoneyBee users are people of color, women, or both. During the pandemic, when the need for its offering was even greater, HoneyBee recruited more than 60 midsize companies as clients and will launch with Fortune 500 companies later this year.
The startup’s user growth grew 225% during the pandemic, and the company says it provided more than $ 2 million in hard-day funding. Meanwhile, their use of on-demand financial therapy increased 172% from the prior year.
“In the midst of this pandemic, when employers were cutting budgets, layoffs, layoffs, cutting hours and wages, we started to see a change in their buying behavior to address financial health,” Lim said.
Honeybee clients include Alameda County Community Food Bank, DC Central Kitchen, Kate Somerville, Community Catalyst of California, Southwest Water Company, Straus Family Creamery, Asian Art Museum, Pasadena Humane Society, and Peachtree Health.
NBA star Baron Davis grew up in south central Los Angeles with his grandmother and says he strongly believes in the startup’s desire to provide access to affordable credit.
“Financial education is barbed wire for people like me. It is critical that companies provide equitable access to financial support for their employees, ”he wrote by email. “Financial access relieves stress in the workplace, especially when they are working hard to make ends meet and provide for their family. Providing easy access to money and education will result in a happier, healthier and more productive workforce. “
FFVC partner AJ Plotkin said his company likes that the product structure “solves a serious access problem for customers who need a bridge to short-term emergency needs, in a way that is not burdensome to the employee or the employer. “
The company plans to use its new capital in part to grow its sales, engineering and customer success team.