The combined company will be called ONE, the name of one of the firms that the fintech start-up is acquiring. It is also acquiring another fintech company, Even. Financial terms were not disclosed.
Walmart — the country’s largest private employer and largest grocer — announced an effort last year to develop unique, affordable financial products that it could offer its millions of customers and employees. It said it was teaming up with Ribbit Capital, one of the investment firms behind Robinhood, to launch an independent fintech start-up.
The venture hired two Goldman Sachs bankers to help spearhead the effort, including Omer Ismail, who led Goldman’s consumer bank. Ismail will lead ONE, according to a Wednesday’s news release.
Walmart has the majority stake of the start-up, which until now had been called Hazel, and its board includes several top executives, including Walmart’s Chief Financial Officer Brett Biggs and Walmart U.S. CEO John Furner.
The start-up plans to capitalize into Walmart’s huge reach: Its 1.6 million U.S. employees and more than 100 million weekly shoppers. It has also pointed to an untapped customer base of millions of Americans who don’t have a bank account, can’t access credit and struggle to build up savings — including many who already shop at Walmart stores.
The acquisitions will help the start-up build an app that’s a singular place for consumers to spend, save, and borrow. Even already has an app that employers can offer their workforce to help with budgeting and setting aside emergency savings. It counts Walmart, PayPal, Humana and Mattress Firm among its customers.
ONE, the other company that the Walmart-backed start-up is acquiring, offers debit cards, checking and savings accounts and an app that helps people track their money and budget.
When the two acquisitions close, the combined business will have more than 200 employees and more than $250 million in cash on the balance sheet to fuel growth, Walmart and Ribbit Capital said. The start-up said it expects the transactions to close in the first half of 2022.
The acquisitions were first reported by The Wall Street Journal.