Pesto raises $11 Million from Activant Capital, Plural, and others to offer affordable alternatives to underbanked Americans
SAN FRANCISCO, May 25, 2023 — Pesto announces the launch of its first product, Pesto Mastercard® issued by Continental Bank, the first credit card that enables customers to use valuables as collateral to secure a credit card. Activant Capital, Plural, and others invested in Pesto to build a solution for Americans that offers a pathway to rebuild or establish credit at lower rates.
Consumers send Pesto their assets and are provided with a credit card based on their value, regardless of credit score. Over time, cardholders who often don’t qualify for an unsecured credit card have the ability to increase their credit score and eventually qualify for one. Pesto Mastercard® offers rates similar to existing credit cards, which are substantially lower than what pawn and payday loan clients typically pay.
James Savoldelli, founder and CEO of Pesto, commented: “Our first product, Pesto Mastercard®, offers interest rates at only a fraction of today’s alternatives, often 90% less than many equivalent pawn loans. It’s a paradigm shift in the credit card market, with the potential to truly democratize credit. Pesto is on a mission to help all Americans find an alternative to high interest rate loans by providing a straightforward way to secure liquidity and build credit through their assets without having to sell them.”
The U.S. pawn shop market generated close to US$ 9.2 billion in interest revenue in 2019. Over 6 million underbanked Americans currently rely on high-interest-rate loans to provide cash and liquidity, with average interest rates at over 120%. Pesto was founded in 2020 to provide a solution for Americans that offers a pathway to rebuild or establish credit at lower rates.
“Existing loan products don’t do enough to help these consumers become more financially free,” said Nathan Morgan, Continental Bank’s Founder & CEO. “We are passionate about supporting Pesto’s mission to make lending more affordable, safe, and accessible.“
Savoldelli founded the company after studying financial inclusion and how consumers with few options use pawnshops for repeat borrowing and not just emergency situations. He spent time working in a pawn shop to understand the industry firsthand, which led him to the idea of the asset-backed credit card.
Pesto intends to use the funding to expand its customer base across the US, with an initial focus on Atlanta and Los Angeles. The company has raised funding from notable investors, including; Activant Capital, Plural, Sozo Ventures, Commerce Ventures, NJF Capital, Soma Capital, NOMO Ventures, Commerce Ventures, Human Capital, OVO Fund, OEL Ventures, Core Innovation Capital, Great Oaks VC, and Y Combinator.
Pesto makes it easy and secure for people to apply and submit their assets for approval, and consumers can find out more at www.getpesto.com Pesto will also continue to build its products to enable customers to leverage their assets to obtain credit, thereby building a path to a more financially secure future.
“Millions of Americans are defaulting to predatory loans as inflation raises household expenses and banks tighten lending to low FICO customers. We’re excited to back the Pesto team on their mission to fix America’s debt trap pandemic and offer a path to a more secure, credit-backed financial future” said David Yang, Partner at Activant Capital.
Khaled Helioui, co-founder of Plural commented: “Access to credit remains one of the most glaring and unnecessary sources of inequality. The lack of federal regulation and our outdated appraisal of creditworthiness leaves the most fragile populations prey to predatory lenders. Pesto’s innovation can be the lever that can help lift millions of people from systemic and unnecessary financial distress, and James has the devotion required to scale its impact.”
To learn more, consumers can visit www.getpesto.com.
About Pesto
Pesto is a San Francisco based fintech company that launched its next generation asset-backed secured credit card, the Pesto Mastercard® in 2023. With Pesto Mastercard®, Americans can secure liquidity and build credit through their assets—without having to sell them. Founded in 2020, Pesto is backed by leading investors, including Activant Capital and Plural. Pesto Mastercard® is issued by Continental Bank.
For more information, please visit www.getpesto.com or follow Pesto on LinkedIn, Twitter, Facebook, and Instagram.
About Activant Capital
Activant is a global investment firm that partners with high-growth companies that are transforming the way the world makes, moves, and sells. Founded in 2015, Activant has invested in over 60 category-defining companies like Deliverr (acquired by Shopify), Hybris (acquired by SAP), Bolt, Better, Celonis, Sardine, and many more. The firm has $1.5B assets under management, and is headquartered in Greenwich, CT with offices in New York City, Berlin, and Cape Town.
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SOURCE Pesto
