50. SoLo Funds

Founders: Travis Holoway (CEO), Rodney Williams
Launched: 2018
Headquarters: Los Angeles
Funding: $24 million
Valuation: $150 million
Key technologies: Decentralized finance (DeFi)
Industry: Fintech
Previous appearances on Disruptor 50 List: 0

The banking system leaves out a lot of people — cutting them off from access to capital, whether it's for a new car, a house, or to start a business. Travis Holoway and Rodney Williams saw the negative impact this had on their friends and family who needed access to short-term loans but had to go without. The experiences spurred them to start SoLo Funds, a community finance platform where members borrow and lend to make a return or a social impact.  

"We remembered being kids when our parents had bills due on Friday but didn't get paid until Monday, so the lights would be shut off when we didn't pay on time. That kind of experience is sadly very common for many Americans, so we wanted to create a solution that gave people a chance," Williams said in an August 2022 interview. 

SoLo is among the fintech firms trying to make the financial system more equitable so that more people want to be a part of it. It works by acting as a peer-to-peer lending platform. Would-be borrowers create a loan request and are matched with an investor, who can be an individual. The two parties agree on repayment terms though SoLo puts some guidelines around this. 

Since its launch in 2018, the company has gained more than a million users, issued over $200 million in loans and run $400 million in transaction volume. The majority, or 82%, of its members are from underserved zip codes. At a time when the number of Black-owned banks has declined sharply, SoLo is looking to fill the void. The company says it is the largest Black-founded and led fintech or neobank. 

The company's mission has garnered support from prominent and celebrity investors such as Kesha Cash, the founder of Impact America, which is the largest fund run by a Black woman, and Serena Williams, who runs Serena Ventures.  

But its growth has not come without controversy in the highly regulated industry of financial services. Critics and state regulators have come after SoLo for a model in which consumers were offered the option to pay tips for the loans they received. Most notably, Connecticut regulators issued a temporary cease and desist order last year, alleging that 100% of the loans to Connecticut residents originated on the platform from June 2018 to August 2021 required some form of a tip being paid — and that resulted in actual interest rates on loans pitched as 0% APR to range from 43% to over 4280% — and that it lacked proper licenses in the state.

SoLo co-founder Williams told American Banker, in response to questions about legal issues, that the company is "working through that process."

It's staffing up for the fight, too. In February, the company made several executive hires with experience in bank compliance and government regulation: Collin Schwartz, who worked for multiple global banks, as general counsel; Kyle George, who worked in the Nevada Attorney General and Governor's offices, to head government & regulatory affairs; and Manny Alvarez, former official at buy now, pay later company Affirm, and former banking commissioner for the state of California.

At the time of those hires, Williams stated, "Too many policymakers don't understand the challenges and opportunities faced by everyday Americans affected by their decisions, which is a major problem we are working to change."