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Slash, a fintech startup founded by two Gen Z entrepreneurs, raised $41 million in Series B funding after pivoting from sneaker resale banking to serving niche industries like performance marketing and crypto. The company rebounded from an 80% revenue drop by embracing a vertical banking model tailored to specific sector needs. With backing from investors like Goodwater Capital and NEA, Slash now processes $300 million monthly and plans further expansion.
From College Dorms to a $370M Valuation: How Slash Starts Strong
Slash began with a focused idea from co-founders Victor Cardenas and Kevin Bai, who started the company while attending Stanford University and the University of Waterloo, respectively. The startup initially catered to sneaker resellers, a community generating significant revenue but lacking access to key banking tools due to their age or business structure. These users often struggled to obtain services like virtual credit cards, making them underserved by traditional financial institutions.
The concept led to early momentum, with Slash raising $19 million across its seed and Series A rounds, both led by NEA. The founders opted for a vertical banking model, tailoring services to specific industries, in contrast to competitors like Mercury and Ramp that pursued a broader approach.
When Yeezys Collapse the Market: The Unexpected Blow That Forced a Pivot
Slash’s original niche faced a sharp downturn after Kanye West’s public controversies. His anti-Semitic remarks prompted Adidas to end its partnership with the rapper, leading to a collapse in the market for Yeezys—one of the most profitable segments for sneaker resellers. Slash’s revenue dropped by 80% almost immediately.
This unexpected shock placed the startup in a difficult position. Despite having raised substantial capital and built a team around its initial market, the company had to quickly adapt to survive.
Betting on the Niche: Why Vertical Banking Makes Strategic Sense
Instead of shifting to a generalized model, Slash doubled down on industry-specific banking. Cardenas argued that creating specialized features for defined sectors provided an advantage over more generic platforms. Vertical banking allows the company to design infrastructure around the specific workflows of clients rather than attempting to serve everyone with a one-size-fits-all product.
This strategy also reduces the need for expensive customer acquisition campaigns by directly targeting users with unmet financial needs in their operational context.
Winning Over Crypto Firms and Ad Agencies: Slash’s New Power Users
Slash reoriented its infrastructure over an 18-month period to serve new segments. The first target was performance marketing agencies that manage digital advertising campaigns. These firms required systems that offered visibility into prepayments and allowed account-level separation for each client. Slash enabled this through its banking architecture, leading to adoption among major ad buyers. Over 1% of Facebook ads are now purchased using Slash-issued cards.
Crypto-native businesses were another focus. Slash offered tools that allowed these firms to switch between fiat and cryptocurrency holdings and manage multiple digital assets under one interface. This became critical at a time when many traditional banks hesitated to work with crypto clients. HVAC operators were also onboarded as the company sought to diversify across tangible service sectors.
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Behind the $41 Million Bet: Investors Believe in Sector-Specific Fintech
Slash announced a $41 million Series B funding round led by Goodwater Capital, bringing the company’s valuation to $370 million. Previous investor NEA also participated, continuing its support from earlier rounds. This funding comes two years after Slash’s initial $19 million raise and marks a strong endorsement from venture capitalists in a competitive fintech landscape.
Rick Yang of NEA, who backed Slash through all funding stages, noted the resilience shown by the team in recovering from an existential threat and reemerging with strong traction. The confidence shown by multiple backers reflects belief in the long-term viability of the vertical banking strategy.
The Quiet Backbone: How Smart Infrastructure Fuels Slash’s Growth
Slash’s operational agility is underpinned by its partnership with Column, a chartered bank co-founded by a former Plaid executive. This relationship gives Slash a reliable banking foundation without the friction often experienced by fintech startups reliant on less flexible partner banks.
Cardenas emphasized that Column was the only banking partner that took the time to understand Slash’s business in depth. This thorough alignment allowed the company to move quickly in launching tailored solutions and scaling across multiple verticals.
What This Means for Fintech’s Next Chapter
Slash’s evolution from a niche sneaker resale enabler to a multi-industry neo-bank suggests a growing demand for financial services that are purpose-built. By continuing to expand into sectors like e-commerce, online travel, and property management, the company plans to increase its presence without competing directly with major players in the corporate credit card market.
With only 35 employees and $300 million in monthly processing volume, Slash demonstrates how focused execution and vertical strategy can drive results in a crowded fintech space.
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