Lili, a startup building banking products to meet the needs of freelance workers, is announcing that it has raised $10 million in seed funding.
The startup takes its name from its founders, CEO Lilac Bar David and CTO Liran Zelkha, who previously founded Israeli challenger bank Pepper. Bar David told me that while many neobanks have emerged over the past few years, most of them "are very focused on the consumer side."
More broadly, she suggested that no traditional banking solutions are really designed to solve the problems faced by freelancers — whether they're designers, programmers, fitness instructors, chefs or beauty professionals. She described Lili as the first "all-in-one" solution, offering both a bank account and a broader suite of financial tracking tools.
The account comes with a Visa business debit card and is unencumbered by account fees, overdraft fees, foreign transaction fees or minimum balance requirements. Bar David said Lili only makes money from card processing fees, which means "we will make money whenever you’re making money."
Lili also supports direct deposit, saying it provides access to payments up to two days earlier than a traditional bank. And to help freelancers manage their finances, there's a tool for tracking and categorizing expenses, and another tool that will put a percentage of income into a sub-account for taxes.
The startup estimates that it can save freelancers up to 60 hours and $1,700 per year. (Bar David said customers may choose to use individual Lili products, but "the benefits of using the product are definitely enhanced when you use it as your main account.") The company launched in 2019 and says it's already used by tens of thousands of freelancers across all 50 states in the U.S.
Bar David also suggested that the freelance economy is only going to grow with the economic instability caused by the COVID-19 pandemic, with millions more people turning to freelance work as either their primary source of income, or as a supplement.
The funding was led by Group 11, with participation from Foundation Capital, AltaIR Capital, Primary Venture Partners and Torch Capital.
“Lili is redefining banking for freelancers and we’re thrilled to be partnering with the team,” said Group 11's Dovi Frances in a statement. “As the future of work continues to evolve more quickly than ever in these uncertain times, Lilac and Liran’s forward-looking vision is changing how modern workers manage their finances, while saving them valuable time and money.”