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Growing up in a low-income family of nine, Perch CEO Michael Broughton was forced to seek out financial independence at a young age. While attending USC, Michael was denied a $10,000 student loan - the amount necessary to pay the remainder of his tuition - due to family finances and a lack of credit history.
Broughton realized first-hand how the credit system is designed to benefit people who are already established in that system. Specifically, he found himself at the end of a catch-22: He was short of the money he needed for college and found out that in order to get accepted for a loan, he needed to already have accrued credit. However, this frustrating experience did not discourage him and he founded Perch Credit.
Perch is a simple app that lets you use recurring payments such as rent and subscriptions like Netflix to bolster your credit score. The app also incorporates a library of financial literacy content to educate and serve audiences excluded from access to finances – particularly marginalized communities and young adults.
Though Michael’s story is inspiring, he is only one of many Americans that have found themselves in a similar situation. As a Black founder, Michael understands the depressing financial reality for marginalized groups across the nation: discriminatory social and legal practices have left minority communities underserved and underbanked. These practices have hindered the ability of these communities to adequately build and access credit. How can individuals and families purchase a home or vehicle without proper credit?
With Perch, Michael has translated his passion to remedy the effects of discrimination into action. After an invitation to the Y Combinator and a successful funding round with participation from Jay-Z and Marcy Venture Partners, Citi and Sequoia, among others. Perch has amassed roughly 200,000 users on its waitlist, and by the end of 2022, Perch is projected to have 1,000,000 active users. Additionally, in May 2020, Michael was named a Thiel Fellow. This exclusive fellowship provides guidance and resources to students 22 and younger who are pursuing world-changing projects, including startups, scientific research and social movements.
By democratizing credit-building with a public, free-to-use platform, Perch is set to change the financial realities of millions of Americans. With free and fair access to credit, how many individuals will no longer need to rely on public transportation because they are able to purchase a car? How many families will be able to build and retain wealth because they can now purchase a home?
Take Sam, one of Perch’s earliest users, for example. Sam was an Uber driver in Los Angeles, CA, trying to move to Ann Arbor, Michigan to reunite with his daughter. However, due to his damaged credit score, he was consistently denied from apartments in Ann Arbor. After using Perch, Sam was able to raise his credit score from 560 to 714 in only two weeks. As a result, Sam now has a new job and lives in Michigan with his daughter in a new apartment.
Perch’s mission is simple: to better the lives of individuals and families across the nation. Michael and the Perch team are committed to keeping their service completely free and will continue fundraising and building partnerships to ensure the impact of credit-building is able to reach those who need it the most.
