Wagestream is a social impact company that helps employees in the UK avoid payday loans, which are criticized for their high interest rates. The company achieves this by allowing employees to get paid immediately for the work done and not on a monthly or weekly basis. To date, the company has raised more than £45 million from investors.
How Wagestream Got Here
- Wagestream was started by Peter Briffett, a serial entrepreneur who has started and exited 3 multimillion-dollar companies.
- The company was started in the United Kingdom, where penny lending is an epidemic.
- It has managed to raise millions of dollars from the likes of Jeff Bezos and Bill Gates.
The Problem Wagestream is Solving
Wagestream was created to help empower employees become more productive and achieve financial freedom. In the U.K., most companies pay their staff at the end of the month. The cost of living has increased while wages have not grown as much.
Therefore, most people are not able to cope with the monthly payday cycle. They then turn to the predatory payday lenders for cash advances. These lenders charge high interest rates that is not affordable and reliable.
This tends to have significant impacts to companies. Employees who are not financially-secure tend to be less productive. Most of them turn down overtime work because of the long delay in the payment cycle.
How Wagestream is Solving This
Wagestream solves this problem by working with companies to implement a system where the employees can access their salaries immediately after working. It does this without affecting the already-existing payment systems in companies. According to Briffett:
We work with the HR, operations, and finance to successfully manage the implementation of the rollout. The rollout is pretty easy and it can be done within a day. To companies, we enable them have happier employees. To employees, we empower them to have financial freedom and growth. We are funding all of the withdrawals up front. We are the first company to marry workforce management and financial data.
Therefore, employees of customer organizations can request their payment every day or whenever they need the cash. Since Wagestream does not offer loans, it charges a small one-time fee depending on the amount the employee has withdrawn.
What Stage is Wagestream In?
Wagestream is an already established company that is in its growth phase. In the UK, the company has deals with some large companies like Rentokil, Camden Town Brewery, and Carllucio.
Wagestream has a relatively easy-to-understand growth model. It partners with companies who then install the system. Since there is no cost for installation, and because of the added benefits the companies get, most companies are open to the idea. The company is first aiming to conquer the UK market before it expands to the rest of the European Union and UK.
Wagestream has raised more than £45 million in debt and equity from investors like Shawbrook, QED, and Rawntree foundation.
Wagestream is headquarted in London. It targets customers in the United Kingdom although the company intends to expand to the rest of the European Union.
Wagestream was started in 2018 to help employees avoid the expensive payday loans. The company offers a relationship that is mutually beneficial between employees and companies. However, the industry is already competitive especially in countries like the US where it intends to launch.
Kasper is our expert for saving, investing and bank accounts. Kasper holds an MSc in Mathematics and worked with Mercedes-Benz and the Dutch tax authorities.