SEED Capital backs Lunar Way to conquer the Nordics!
The recent €13 million funding round was led by SEED Capital with participation from Greyhound Capital, Socii Capital and other individual investors from the financial service industry. Lunar Way has in a very short time managed to get a hold on a large customer base among the young segment in Denmark, also referred to as Millennials. Two months ago, the mobile banking app launched in Sweden and nearly the day after receiving our new investment, Lunar Way expanded to the shores of Norway.
Lunar Way is on a mission to make people’s finances easy, transparent and tailored to fit people’s needs. They live and exist by the slogan ‘’Making Money Matter’’, by offering a simple and personal way of handling people’s money. According to Lunar Way, money isn’t just money — it’s what you do with it that creates the value.
The Fintech company wants to challenge the old-fashioned bank experience. Everything is changing, and Lunar Way believes that banks should too. To do so, Lunar Way offers a fully digital experience. Customers of Lunar Way get a free bank account in a smartphone app plus a free credit card. The solution is 100% transparent, which means that users won’t experience unexplained fees in small print. Instead they are offered a freemium model meaning that being a member is free of charge, and extra services such as credit is offered as a subscription with a fixed monthly payment.
On the app, several features are provided that are supposed to help users get a good grip of their personal finances. The features involve a unique and motivating budget feature that helps setting up budgets and savings for future goals or unexpected bills. The digital experience also provides a manageable overview of past expenditures making it easy to revise how you can spend your hard-earned money more wisely.
The company was founded in 2015 by the experienced founder and entrepreneur Ken Villum Klausen. He saw an unmet need in the bank industry of technology-driven service among Millennials. They wanted banking in a new way! The so-called ‘Millennials’ started their career around the time of the financial crisis and resultingly, the trust in banks was almost non-existing. This became the starting point and beginning of an idea, that today is known as Lunar Way.
How is Lunar Way challenging status quo?
Lunar Way recently broke the ground by receiving two important licenses as the first Fintech company in Denmark. In 2018 they received a PISP license (Payment initiation service provider) as well as an AISP license (Account information service provider) — breaking centuries of monopoly on payment services and account information. The licenses authorize Lunar Way to make payment transactions on their users’ behalf, allowing them to pay bills, transfer money, analyze their spending and set budget priorities, while the money stays in their customers own bank account. Additionally, they are authorized to collect data from their users’ bank accounts if consented, and thus have a way better opportunity to gather and help managing personal finances.
Today, the neo-bank also offers 2% on their users’ money while most banks offer 0%. According to Lunar Way — it’s payback time! Not offering payback on deposits has been the standard for a very long time. ‘’In the way most banks are structured today, consumers are the big losers meanwhile the banks are winning’’ says CEO & Founder, Ken Villum Klausen. According to the founder, it is time for a change where customers are acknowledged and being paid for putting their hard-earned money in a bank for the bank to use.
It’s all about the user experience
Lunar Way is taking the user-centric approach to the next level with the digital platform. The company has over the years established a community among users, where they can test, give feedback and help improving and developing Lunar Way for the future. In addition, users of Lunar Way are offered eminent customer service right on the platform. All taken together it has contributed to a very high satisfaction rate. On Trustpilot, Lunar Way has achieved the rating ‘’Excellent’’ (9 out of 10), which is a pretty great result!
Besides offering a great service, Lunar Way also wants to contribute and support the entrepreneurial spirit in Denmark by helping newly established businesses succeed. To do so, they launched a campaign and competition called #Selfmade in 2018 as a tribute to Danish entrepreneurs — and it was a great success! In addition, Lunar Way today offers business cards that are supposed to make it easier for small businesses getting started and handle their budgets.
Why we invested in the company
We invested in the company for the first time in 2015, and it has been an interesting case ever since. ‘’Lunar Way fits perfectly into our portfolio of companies. We are thrilled to be investors in start-ups, such as Lunar Way, Trustpilot, Vivino and Grandhood that focus on offering transparency. Lunar Way has in many ways shown that there is big potential in challenging the existing bank industry, and they are definitely heading in the right direction’’ says General Partner, Lars Andersen about the portfolio company.
We are not the only ones who see the big potential. In 2018 Lunar Way was nominated in several awards such as the Danish Digital Award (winner of three categories), Pulse Awards for Best Design, and Nordic Startup Award (winner of the title: Best Danish Fintech).
With the new investment, Lunar Way will be able to fine-tune their existing products, develop new ones that are tailored to the local needs of the Nordic countries and accelerate growth. Lunar Way is well on the way in conquering the Nordic market, and the company recently made a strategic partnership with Tink, a well-established Swedish fintech-company in order to expand much faster.
2019 might end up being an even greater year for the company, and we are very excited about the journey and having Lunar Way in the SEED family!
Also read: Entrepreneurs are the heroes of our time
