Ingenious Financial is planning to raise $200m in Series A funding to buy an existing bank to better serve underserved and underbanked communities in the US.
The owners of the company are looking to buy a Federal Deposit Insurance Corporation (FDIC) insured bank to circumvent the challenges associated with starting a bank from scratch.
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Darnell Parker, founder of Ingenious Financial, and Derek Taylor, COO of Ingenious Financial, intend to name venture Bank of Ingenious.
The venture will focus on retail and business clients looking for loans. It will specifically target professional services providers such independent physicians, dentists, and veterinarians.
Parker said: “Minority banks play an important role in the economic empowerment of minority communities and these financial institutions have long been considered as innovators in banking. But in recent years, they have not always managed to keep up with technological advances.
“When larger financial institutions absorbed some of the minority deposit institutions banks, they left a tremendous void for these banks, who previously served minority communities by providing small to medium-sized business loans,” Parker added.
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By GlobalDataThe company hopes to close find raise by the end of June and make first acquisition in the third quarter of this year.
Ingenious Financial added that it could make more acquisitions in the fourth quarter and early part of next year.
The company will offer stock warrants to all initial investors, not just its directors.
Taylor added: “Their collective experience will make them an attractive partner to potential acquisitions, as well as effective leaders of the kind of bank they feel is needed in the nation in the aftermath of recent market disruptions.”
The proposed venture will operate with a small physical presence.
“We hope that this investment will sustain African American financial institutions in the American history, foster popular, engaging workflows, and bring innovation to every client, customer and community we serve,” Parker added.
