GreenDot : The Ubiquitous Pre-Paid Card Gets Funded at $20M

Green Dot, the market leader in pre-paid Visa/ Mastercard was funded by the Tech Coast Angels in 2001 followed by a Series A in the round in 2003 from Sequoia Capital. Sequoia followed up with a Series B round in December of 2006 where the company raised a further $20M.

Green Dot sells reloadable, prepaid cards at retail locations around the country, such as Rite Aid. Though originally conceived as a card for parents to give to their kids when they went to college, the card has found wide acceptance in many immigrant communities where there is a high demand for virtual cash, as well as with the large sub-par credit market, which does not have access to traditional credit cards.

The strength of GreenDot has been its strong distribution system. In a market where the usefulness of the card depends very much on the proximity of the closed reloading station, Green Dot, with its 150,000+ retail locations in the country is far ahead of the its competitors. The Amigo money card has a much smaller but strong base in the US Spanish speaking population, as well as a large network in South America.

With Green Dot already having a commanding 90% market share in the prepaid business, one can only speculate that the latest cash infusion will mean expansion overseas, where a pre-paid product that allows customers to buy over the internet would be very welcome.

Company: Green Dot
CEO: Steven Streit
Funding Raised: $20M+
Investors: Sequoia Capital, Tech Coast Angels

3 Responses to “GreenDot : The Ubiquitous Pre-Paid Card Gets Funded at $20M”

  1. By Priscilla on Feb 5, 2022 | Reply

    All the prepaid card providers need to figure out a way to not charge monthly fees and make it economical to use the card. There is a huge potential here but not at $150/year for letting the customer use his/her own money. Especially since these cards are being used by people that can least afford to spend that kind of money.

  2. By Virgie on Jun 28, 2021 | Reply

    I have one of these cards, and it does not cost $150/yr to use one. It is $4.95 per month, and that is waived if you have your paycheck direct deposited. Other than that, there is a $9.95 fee to get the card, and a $4.95 fee to reload additional money onto the card. That comes to nowhere near $150 per year. Also, if there were no monthly fees, what would the incentive be for companies to even offer the card? Before cards like the green dot card existed, there were prepaid cards that charged exhorbitant fees. Those cards had to be applied for just like regular credit cards. These newer cards, that can be bought in stores, are quite a bit different, and like I said, do not have the high fees. After a very bad divorce, I was left with a financial mess. Without the green dot, I would be forced to use cash for everything. Also, it takes the place of my checking account, as it has lower monthly fees and like a checking account, waives monthly fees if you use direct deposit. ATM withdrawals charge $2, so I always get extra cash when I shop, and there is no fee at all for that. My check goes directly into it, so I never have to pay the $4.95 reload fee. My only cost to use this was the $9.95 fee. These are a good deal if you use them right. The only way you ae going to hit $150 in fees is if you are constantly taking money out of an ATM, and constantly making deposits. The way most bank accounts work now, you would get high fees from thsoe as well if you do these things. Priscilla appears to not have ever reseatched these because she is quite incorrect.

  3. By kim on Aug 17, 2021 | Reply

    Do not waste your money on these cards! My family bought 3 not knowing any better! The fees are high. We didn’t even have it but 5 days and it took a months fees out and then the charges are crazy high I should have had 70.00 more but they emptied mine in fees. Just this morning my sons showed 44.00 he put 10.00 in gas in and NOW he has 9.37. My husband has not even used his since we got back from vacation a week ago. He had 419.00 left on his so when our son said he was having trouble using his and we fount out the charges for the gas, my husband’s balance is 394.00. He hasn’t even used his! It is a major rip off! Beware! I couldn’t even get people to take the crazy thing anyways and it was a good thing I took money with me. Besides one lady trying to rip my purse off on Santa Monica peer, The Vise Green Dot did it right inside my purse. Now how can I press charges for that?

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