digital bank private onyx today announced $4.1 million in new funding to provide private banking and investment services specifically tailored to high-income Millennials and Gen Zers.
Village Global, Y Combinator, Global Founders Capital, One Way Ventures, 186 Ventures and Olive Tree Capital participated in the investment.
In partnership with Piermont Bank, Onyx Private offers digital banking services, including checking accounts, a debit card, and cash back on payments and purchases. On the investment side, the fintech builds investment portfolios from high-yield fixed-income portfolios, such as cash transfer accounts and US Treasury bills, with $100 minimums and low fees.
There is an application process to join Onyx Private and customers can choose between a free plan or a premium plan that costs $50 per month or $40 per month if you pay for membership in one payment.
Investment services are managed by Helium Advisors and the brokerage account is through Pershing, a clearinghouse owned by Bank of New York Mellon.
In addition, the company offers a “lifestyle concierge” service, via a personal digital assistant, to help with booking events, dinners, hotels and flights, and even shopping for luxury gifts like jewelry. .
Victor Santos, Douglas Lopes and Tiago Passinato launched the company in 2022. Santos, who came to the United States as a child, previously co-founded banQi, a Brazilian neobank focused on financial inclusion that was acquired by Via Varejo in May 2020.
Onyx Private board and bank card. Image Credits: Onyx Private
While building products for low-income people, Santos told TechDigiPro that he and his co-founders realized there was a gap in the market: lots of options for the very wealthy or lower- and middle-classes, but not many for people in between. .
“These are people who are not necessarily wealthy, but are wealthy professionals, like lawyers, doctors or people who work in technology,” Santos said. “Onyx’s goal is to build a more modern and accessible private bank and democratize the tools that today are only available to the ‘ultra-rich.’”
Since its launch nearly a year ago, Onyx Private has grown 30% month-over-month and is processing over $4 million worth of payment transactions per month. The company is approaching $5 million in POS with the goal of quintupling that volume by the end of the year, Santos said.
Next, Santos, Lopes and Passinato envision Onyx Private as “the next generation UBS”, and the new funding will go towards that goal. The company plans to invest some capital in new product lines and to introduce an in-app human financial advisor next year that will provide financial, estate planning and tax advice. Much of their growth thus far has been through referrals; however, the company will now invest in marketing.
“There is a lot of pressure on these new low-income focused banks, and what we think is powerful is that our average revenue per user and our average user balance is 10 to 12 times more than these traditional neobanks,” Santos said. “We’re small, but it shows that it’s a very different demographic and that there’s a greater willingness to pay for premium services from that demographic.”
