Nova Credit: Helping immigrants build a new financial life, faster

by Index Ventures


A few weeks back, I went to a small Russian-style family party in Misha Esipov’s San Francisco apartment. The food was all homemade by his mom, a research scientist, who flew the food and even the dishes from New York, where she’d bought her trusted ingredients in a specialty Russian store on the outskirts of the city.

It was such a special occasion to be part of and also a true American experience - one that embraces the cultures we grew up in as well as the new one we are building together. Plus, the Uzbek plov was to die for.

It’s hard to argue for a state that better represents the vibrancy and success of American immigration than California. We’re home to more than 10 million immigrants from around the world, around 27% of the state’s population, and half the children in California have one foreign-born parent. In fact, California best illustrates an increasingly mobile global population, in which the number of global migrants will actually surpass the entire population of the US within two decades.

Given this vast audience, it’s astonishing that many services are so poorly equipped to help immigrants when they arrive in the US. Perhaps the most startling of those is in the finance sector, where immigrants can’t bring their credit history with them - even if they have decades of flawless prime or super prime borrowing. So begins a tedious and expensive process of slowly building a credit rating which takes patience, and several years. Many immigrants have experienced not being able to get a credit card, or having to ask relatives to act as guarantors for rentals, or of paying sky-high APRs on things like auto loans.

As well as being a stressful and expensive obstacle to immigrants, this lack of access to financial products also means that banks and companies are missing out on millions of credit-worthy consumers. There’s a massive opportunity in unlocking access to this ‘thin file’ demographic of migrants who now make up the majority of population growth in the US,  and we estimate the market is worth tens of billions of dollars. But convincing risk-averse incumbents to adopt new technology is a challenge, and we knew we needed to find a team capable of pushing down walls to make this vision a reality. When we met Misha and his Nova Credit co-founders, Nicky Goulimis and Loek Janssen, we knew we had found our champions. 

Nova Credit is building a global credit bureau. We made our first investment in Nova Credit when they came out of Y-Combinator in 2016. We were blown away by the team’s chemistry, thoughtfulness, and dedication to their mission. As immigrants, all three co-founders experienced the problem first hand. Over the next two years, the team methodically executed on their goals, building the infrastructure needed to access more international credit data than even the largest credit bureaus. They quickly became the world-standard for cross-border credit reporting. And with increasing demand from financial institutions and property managers for Nova’s credit data and analytics, the company has been expanding rapidly.   

We’re delighted to announce our Series A investment in the company, backing Nova Credit for the next phase of their groundbreaking business. It’s a business that will have a huge impact on the lives of thousands - eventually millions - of people as they build a new life in the US, Canada and more markets to come. 

Published — May 30, 2018