Max Levchin, with his start-up, Affirm, is trying to take on the big banks and revolutionize online lending for a younger generation of Americans.
This morning, Levchin announced that he has raised a ton of new money in that fight.
The PayPal co-founder and Yahoo board member says that Affirm raised $275 million in debt and equity financing, which it will use to increase its loan distribution capacity, offer customers lower cost loans, and develop new products.
Spark Capital Growth led the investment, and was joined by new investors Jefferies and Andreesen Horowitz as well as existing investors Khosla Ventures and Lightspeed Venture Partners.
To date, Affirm has now raised a total of $325 million.
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"Today's financial services industry is not well-equipped to handle the needs of the largest consumer generation in history," Levchin said in a statement. "We're building a financial technology company for the next generation, and for anyone who expects more from their financial service providers."
Levchin bills Affirm as the "future of honest finance." The start-up offers a simple, fixed-term loan at the point of sale, and the approval is in real time. Consumers fill out basic personal information online, and Affirm then runs a credit check.
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Once approved, consumers can buy goods from more than 100 merchants—everything from bedding at Casper to jewelry at Ice.com.
There are, of course, a range of companies now using technology to re-imagine loan underwriting, from Lending Club, which went public in December, to Prosper, a peer-to-peer market claiming 2 million members. There's also Levchin's old company: 'PayPal Credit' is an online lending option that works with thousands of stores.
Still, the biggest risk for Levchin isn't necessarily the competition but the potential for bad loans. But, at least right now, that threat doesn't seem to be discouraging top-tier venture capitalists from investing in Affirm and its founder's vision for the future of online lending.