PayPal co-founder Max Levchin's consumer lending company Affirm received $100 million in a series D round of funding, the company announced Wednesday, bolstering support for what could be a major competitor to more traditional lenders and creditors.
Affirm's new round of funding, led by Founders Fund, could last the company a couple of years, possibly until it reaches profitability, Levchin, founder and CEO of Affirm, said Wednesday in an interview on CNBC's "Squawk Box." However, he didn't disclose how long that may take.
Affirm's series D round comes amid concerns that funding for Silicon Valley tech start-ups has begun to dry up.
"Before I started fundraising, I (got) the sense that the markets are really tough right now, and everybody was telling me how I should be prepared for a down round, a flat round is a blessing," Levchin told CNBC. "And we did not have a hard time raising money, mostly because we partnered up with people we already know and trust, so fundraising was both easy and pleasant."
Affirm allows consumers to purchase items on credit at brick-and-mortar store registers or checkout lines without a traditional credit card. It gives credit to consumers who lack access to traditional credit card companies because of a poor or short-lived credit history, according to the company.
The start-up determines what it will charge consumers based on traditional credit scores as well as less-traditional information like data from profiles on social media and online bill payments, according Affirm.
New financial services technology firms face competition from moreestablished players including big banks as well as PayPal, whichLevchin helped found in 1998. He said he expects many of thosestart-ups will end up being acquired by the bigger, older companies.
"Many will become absorbed into the financial ecosystem and help it innovate itself from within," Levchin said, adding that he hopes Affirm will be one of the companies that remains independent of those major financial institutions.