“Smart” credit card company X1 has raised $12mn funding.
In Brief:
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X1 offers a stainless steel card that uses current and future income to set credit limits.
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The round was led by Spark Capital.
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It included Jared Leto; the CEOs of Box, Yelp, Affirm and Y Combinator; and PayPal Co-Founder Max Levchin.
What does this mean?
X1 offers an alternative to credit scores when it comes to deciding how much credit to offer customers. Reportedly, this results in credit limits of up to five times higher than average credit cards. It’s certainly a solution the market was asking for, with the current system of deciding credit often said to be broken – but offering such a large amount of credit will come with its own risks.
