According to two persons familiar with the subject, Oxygen, a startup that provides digital banking services to freelancers and micro- and small-sized businesses, is in talks to fund a new round at a valuation of over $500 million.

According to the sources, the San Francisco-based startup is in advanced stages of talks to raise roughly $70 million. Tribe Ventures, located in London, is in talks to lead Oxygen’s Series B investment, according to the people, who asked to remain anonymous since the specifics are confidential.

Banks in the United States — and worldwide — have generally declined to serve those who do not have a traditional employment and a steady income.

Hussein Ahmed, a former Amazon employee, ran into similar problem when he began working as a freelance consultant for other firms. In a podcast last year, he added, “That’s when I came into the market segment we’re serving now.” “Everyone around me, from photographers to real estate agents to accountants, were having the same difficulty,” Ahmed learned while working from a WeWork.

Ahmed began using Oxygen at that time. Consumers and small businesses can sign up for accounts with no monthly fees. These FDIC-insured accounts have no minimum balance requirements and come with a Visa debit card.

Y Combinator and Runa Capital are among the investors in the firm, which has collected over 600,000 clients.

Oxygen declined to comment on the funding talks, but through a spokesman, Ahmed stated that the firm has experienced “huge growth in 2021,” with sales increasing by tenfold this year. “We are in constant discussions about how to best fund our future objectives and will provide updates as soon as possible.”

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