In February 2026, US-based digital bank Varo Bank secured USD 123.9 million in a Series G funding round, with Warburg Pincus and new investor Coliseum Capital Management leading the investment.
Northview, an existing investor, also participated and increased its stake in the company as part of this round. Following the capital raise, Varo Bank welcomed Alice Milligan and Kevin Watters to its board of directors.
Gavin Michael, CEO of Varo Bank, stated that the additional funding and new board members are aimed at supporting the bank’s next phase of growth while maintaining a focus on operational discipline and customer service.
Platform Growth and Lending Expansion
Varo Bank launched its mobile app in 2017, operating as one of the first fully digital nationally chartered banks in the United States. The platform leverages proprietary machine-learning models to enhance credit data, enabling broader lending access beyond traditional credit scoring methods.
In 2025, Varo Bank’s lending products, including Varo Advance and Varo Line of Credit, contributed to a total lending volume of USD 547 million, indicating a rise in demand for their credit services. The bank also provides high-yield savings accounts and cashback debit card options as part of its comprehensive banking solutions.
The company experienced revenue growth and cost reductions in 2025; specific financial details were not made public.
Chris Shackelton, co-founder and Managing Partner of Coliseum Capital Management, expressed confidence in Varo Bank’s leadership and potential for future growth. The investment was based on the bank’s innovative approach to differentiate from traditional banking institutions and its efforts to improve customer value propositions.
With the addition of Milligan and Watters to the board, Varo Bank emphasizes a blend of cutting-edge technology-driven experiences with robust regulatory compliance required for national banking. The board expansion is expected to facilitate the scaling of the bank’s lending and banking platforms.
Varo Bank complies with federal banking regulations and is an FDIC member.
