Here’s the 12-page pitch deck that Alloy, a fintech that helps vet customer identities and prevent fraud, used to raise its $40 million Series B in less than a month
This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now.
- Alloy, a startup that helps banks and fintechs verify customers’ identities, closed a $40 million Series B.
- Canapi Ventures led the round. New investors Avid Ventures and Felicis Ventures also participated, along with previous backers Bessemer Ventures, Primary Venture Partners, and Eniac Ventures.
- Laura Spiekerman, Alloy cofounder and chief revenue officer, and Victoria Treyger, a general partner and managing director at Felicis Ventures, spoke to Business Insider about the round.
- Check out the 12-page deck Alloy used to raised the $40 million Series B.
- Visit Business Insider’s homepage for more stories.
A startup that helps financial firms verify customers’ identities just raised $40 million from investors, highlighting the growing interest in disrupting the tech used behind the scenes by banks and fintechs.
Alloy, a New York-based fintech, closed a $40 million Series B led by Canapi Ventures. New investors Avid Ventures and Felicis Ventures also participated, along with previous backers Bessemer Ventures, Primary Venture Partners, and Eniac Ventures.
In July, three venture investors surveyed by Business Insider highlighted Alloy, which had previously raised $19 million, as an up-and-coming fintech.
Victoria Treyger, a general partner and managing director at Felicis Ventures, told Business Insider interest in companies that streamline manual processes for banks is at an all-time high.
“Right now, fintech infrastructure is the hottest that it has ever been, and it makes sense that it would be,” said Treyger, whose previous investments include insurtech unicorn Hippo and infrastructure fraud startup SentiLink. “If you look at companies like Fiserv and FIS, which are kind of the core fintech infrastructure companies that people think about, they are $90 billion and $60 billion companies and they are from the 1980s and 1960s. There has been very little innovation in fintech infrastructure in the last six decades.”
Alloy’s area of focus — helping financial firms onboard and verify customer’s identity — has specifically come into the spotlight recently as an increasing number of firms embrace digital banking. With no in-person interactions with new customers, financial firms have a tougher time confirming identities and avoiding fraud.
“When you’re a bank trying to move your business online, opening deposit accounts online or on mobile, or a fintech company that’s obviously sort of challenging those banks in certain ways, it’s really hard to verify people because the databases and methods that we have were not built for today’s world,” Laura Spiekerman, Alloy cofounder and chief revenue officer, told Business Insider.
Read more: Investors at Point72 and Goldman Sachs believe industry giants like FIS and Fiserv will be the next to be disrupted by fintech. Here’s where they are most susceptible.
But even with Alloy’s strong position within the market — Spiekerman said the startup doubled revenue and clients in 2019 — the fintech did take time to reevaluate things when the pandemic first hit. However, after some scenario planning in March, the startup was confident it had enough runway to weather any potential storm.
In actuality, April and May ended up being strong months for the fintech. And by early summer, Spiekerman said, the decision was made to raise another round.
“We thought, let’s just take advantage of this moment and see what we can do,” she added.
With limitations around travel, Spiekerman said the goal was to keep the timeline short. A short list of roughly six firms that the fintech was familiar with was established. The entire process, Spiekerman said, lasted roughly two weeks.
Looking ahead, Spiekerman said the focus for Alloy will be to go deeper, not wider. Essentially, the goal is to aid financial firms with any questions it may have about a client’s identity.
“Whether it’s they’re enrolling in online and mobile banking for the first time, or they’re making some sort of funky, high-risk transaction, we want to be behind the scenes, enabling them to make a better real-time decision there,” Spiekerman said. “So it’s really about powering that entire life cycle of customer decision.”
Find more pitch decks in our searchable PITCH DECK LIBRARY here.