Where top VCs are investing in fintech

Over the past several years, ‘fintech’ has quietly become the unsung darling of venture.

A rapidly swelling pool of new startups is taking aim at the large incumbent institutions, complex processes and outdated unfriendly interfaces that mar billion dollar financial services verticals, such as insurtech, consumer lending, personal finance, or otherwise.  

In just the past summer, the startup community saw a multitude of hundred-million dollar fintech fundraises. In 2018, fintech companies were the source of close to 1,300 venture deals worth over $15 billion in North America and Europe alone according to data from Pitchbook. Over the same period, KPMG estimates that over $52 billion in investment pour into fintech initiatives globally. 

With the non-stop stream of venture capital flowing into the never-ending list of spaces that fall under the ‘fintech’ umbrella, we asked 12 leading fintech VCs who work at firms that span early to growth stages to share where they see the most opportunity and how they see the market evolving over the long-term.

The participants touched on a number of key trends in the space, including rapid innovation in fintech infrastructure, fintech companies embedding themselves in specific verticals and platforms, rebundling and unbundling of financial services offerings, the rise of challenger banks and the state of fintech valuations into 2020.

Charles Birnbaum, Partner, Bessemer Venture Partners

The great ‘rebundling’ of fintech innovation is in full swing. The emerging consumer leaders in fintech — Chime, SoFi, Robinhood, Credit Karma, and Bessemer portfolio company Betterment — are moving quickly to increase their share of wallet with their valuable customers and become a one-stop-shop for people’s financial lives.

In 2020, we anticipate continued entrepreneurial activity and investor enthusiasm around the infrastructure and middleware layers within the fintech ecosystem that are enabling further rebundling and a rapid convergence of product themes and business models across the consumer fintech landscape.

Many players now look like potential challenger bank models more akin to what we have seen unfold in Europe the past few years. Within consumer fintech, we at Bessemer are more focused on demographically-specific product offerings that tap into underserved themes, whether that be the financial problems facing the aging population in the US or new models to serve the underbanked or underserved population of consumers and small businesses.

Ian Sigalow, Co-founder & Partner, Greycroft

What trends are you most excited in fintech from an investing perspective? 

I suspect that many enterprise software companies become fintech companies over time — collecting payments on behalf of customers and growing revenues as your customers grow. We have seen this trend in many industries over the past few years. Business owners generally prefer a model that moves IT expenditures from Operating Expenses into Cost of Goods Sold, because they can increase prices and pass their entire budget onto the customer.

On the consumer side, we have already made investments in branchless banking, insurance (auto, home, health, workers comp), cross-border payments, alternative investments, loyalty cards/services, and roboadvisor services. The companies we funded are already a few years old, and I think we will have some interesting follow-on activity there over the next few years. We have been picking spots where we think we have an unfair competitive advantage.

Our fintech portfolio is also more global than other sectors we invest in. This is because there are opportunities to achieve billion dollar outcomes in fintech, even in countries that are much smaller than the United States. That is not true in many other sectors.

We have also seen trends emerge in the US and move abroad. As an example we seeded Flutterwave, which is similar to Stripe, and they have expanded across Africa. We were also the lead investor in Yeahka, which is similar to Square in China. These products are heavily localized —tin for instance Yeahka is the largest processor of QR code payments in the world, but QR code payments are not popular in the US yet.

How much time are you spending on fintech right now? Is the market under-heated, over-heated, or just right?

Fintech is about a quarter of my time right now. We continue to see interesting new ideas and the valuations have been more or less consistent over time. The broader market doesn’t impact us very much because we tend to have a 10 year holding period.

Are there startups that you wish you would see in the industry but don’t?

Former Stitch Fix COO Julie Bornstein is rewriting the e-commerce playbook

More than two years after Julie Bornstein–Stitch Fix’s former chief operating officer–mysteriously left the subscription-based personal styling service only months before its initial public offering, she’s taking the wraps off her first independent venture.

Shortly after departing Stitch Fix, Bornstein began building The Yes, an AI-powered shopping platform expected to launch in the first half of 2020. She’s teamed up with The Yes co-founder and chief technology officer Amit Aggarwal, who’s held high-level engineering roles at BloomReach and Groupon, and most recently, served as an entrepreneur-in-residence at Bain Capital Ventures, to “rewrite the architecture of e-commerce.”

“This is an idea I’ve been thinking about since I was 10 and spending my weekends at the mall,” Bornstein, whose resume includes chief marketing officer & chief digital officer at Sephora, vice president of e-commerce at Urban Outfitters, VP of e-commerce at Nordstrom and director of business development at Starbucks, tells TechCrunch. “All the companies I have worked at were very much leading in this direction.”

Coming out of stealth today, the team at The Yes is readying a beta mode to better understand and refine their product. Bornstein and Aggarwal have raised $30 million in venture capital funding to date across two financings. The first, a seed round, was co-led by Forerunner Ventures’ Kirsten Green and NEA’s Tony Florence. The Series A was led by True Ventures’ Jon Callaghan with participation from existing investors. Bornstein declined to disclose the company’s valuation.

“AI and machine learning already dominate in many verticals, but e-commerce is still open for a player to have a meaningful impact,” Callaghan said in a statement. “Amit is leading a team to build deep neural networks that legacy systems cannot achieve.”

Bornstein and Aggarwal withheld many details about the business during our conversation. Rather, the pair said the product will speak for itself when it launches next year. In addition to being an AI-powered shopping platform, Bornstein did say The Yes is working directly with brands and “creating a new consumer shopping experience that helps address the issue of overwhelm in shopping today.”

As for why she decided to leave Stitch Fix just ahead of its $120 million IPO, Bornstein said she had an epiphany.

“I realized that technology had changed so much, meanwhile … the whole framework underlying e-commerce had remained the same since the late 90s’ when I helped build Nordstrom.com,” she said. “If you could rebuild the underlying architecture and use today’s technology, you could actually bring to life an entirely new consumer experience for shopping.”

The Yes, headquartered in Silicon Valley and New York City, has also brought on Lisa Green, the former head of industry, fashion and luxury at Google, as its senior vice president of partnerships, and Taylor Tomasi Hill, whose had stints at Moda Operandi and FortyFiveTen, as its creative director. Other investors in the business include Comcast Ventures and Bain Capital Ventures

FOSSA scores $8.5 million Series A to help enterprise manage open-source licenses

As more enterprise developers make use of open source, it becomes increasingly important for companies to make sure that they are complying with licensing requirements. They also need to ensure the open-source bits are being updated over time for security purposes. That’s where FOSSA comes in, and today the company announced an $8.5 million Series A.

The round was led by Bain Capital Ventures, with help from Costanoa Ventures and Norwest Venture Partners. Today’s round brings the total raised to $11 million, according to the company.

Company founder and CEO Kevin Wang says that over the last 18 months, the startup has concentrated on building tools to help enterprises comply with their growing use of open source in a safe and legal way. He says that overall this increasing use of open source is great news for developers, and for these bigger companies in general. While it enables them to take advantage of all the innovation going on in the open-source community, they need to make sure they are in compliance.

“The enterprise is really early on this journey, and that’s where we come in. We provide a platform to help the enterprise manage open-source usage at scale,” Wang explained. That involves three main pieces. First it tracks all of the open-source and third-party code being used inside a company. Next, it enforces licensing and security policy, and, finally, it has a reporting component. “We automate the mass reporting and compliance for all of the housekeeping that comes from using open source at scale,” he said.

The enterprise focus is relatively new for the company. It originally launched in 2017 as a tool for developers to track individual use of open source inside their programs. Wang saw a huge opportunity inside the enterprise to apply this same kind of capability inside larger organizations, which were hungry for tools to help them comply with the myriad open-source licenses out there.

“We found that there was no tooling out there that can manage the scale and breadth across all the different enterprise use cases and all the really complex mission-critical code bases,” he said. What’s more, he found that where there were existing tools, they were vastly underutilized or didn’t provide broad enough coverage.

The company announced a $2.2 million seed round in 2017, and since then has grown from 10 to 40 employees. With today’s funding, that should increase as the company is expanding quickly. Wang reports that the startup has been tripling its revenue numbers and customer accounts year over year. The new money should help accelerate that growth and expand the product and markets it can sell into.

Sperm storage startups are raising millions

A number of startups are bringing technology and innovation to the fertility industry, with a growing few focused specifically on male fertility.

“Society at large doesn’t understand the subject of fertility,” Tom Smith, the co-founder and chief executive officer of men’s sperm storage startup Dadi tells TechCrunch. “People see it as a female issue.”

Dadi has raised a $5 million seed extension led by The Chernin Group, a private equity fund that typically invests in media, with existing investors including London seed-fund Firstminute Capital and New York’s Third Kind Venture Capital also participating. The company, which sends at-home fertility tests and sperm storage kits, closed a $2 million seed round earlier this year.

Dadi’s funding event comes shortly after another men’s fertility business, Legacy, raised a $1.5 million round for its sperm testing and freezing service. Both companies hope to leverage venture capital funding to become the dominant men’s fertility brand.

Bain Capital Ventures -backed Legacy, which won TechCrunch’s Startup Battlefield competition at Disrupt Berlin 2018, allows men to get their sperm tested and frozen without visiting a clinic or meeting with a doctor. Founder and chief executive officer Khaled Kteily said the company, which is based out of the Harvard Innovation Labs in Boston, planned to use the capital to expand its sperm analysis and cryogenic storage services.

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Sarah Steinle, head of marketing, Khaled Kteily, founder and CEO, and Daniel Madero, head of clinic partnerships at Legacy .

Like many startups today, Dadi and Legacy are capitalizing on the direct-to-consumer business model to educate men about their fertility. Customers of both Dadi and Legacy simply order a DIY sperm collection kit online, collect a sperm sample and send it back to the company for a full fertility report. Both companies offer sperm storage services too. Dadi charges a total of $199.98 for its sperm testing kit and one year of sperm storage, while Legacy asks for $350 for clinical fertility analysis and lifestyle recommendations. To store your sperm in Legacy’s cryogenic storage facilities, it’s an additional $20 per month.

One in six couples struggles to get pregnant after one year of trying. According to the U.S. Department of Health & Human Services, one-third of the infertility cases amongst those couples are caused by fertility problems in men, another one-third of issues are connected to women and the remaining cases are a result of a combination of male and female fertility issues. By making sperm storage more accessible, startups hope to encourage a conversation around family planning and fertility among young men.

“Men also have a biological clock,” Smith said. “From your late 20s and onward, your overall sperm count absolutely declines and, more importantly, the number of mutations that can be passed on to that potential child grows.”

Dadi, a New York-based company, plans to use its latest bout of funding to continue developing a number of yet-to-be-announced products, as well as offer new support services to customers who’ve taken Dadi’s fertility tests: “If we are going to live up to our overall objective of being this encompassing business helping men through the fertility stack, the next step for us is investing in next-step support,” Smith explains.

Dadi’s founding team lacks experience in the healthcare sector, which is likely to pose problems as the company expands and forges partnerships in the greater healthcare field. Smith previously led a custom emoji business, Imoji, which was acquired by Giphy in 2017. Dadi co-founder Mackey Saturday, for his part, was previously a graphic designer responsible for creating Instagram’s logo.

Aiming to make up for its lack of expertise, Dadi has formed a Science and Technology Advisory Board with participation from Dr. Michael Eisenberg, associate professor of urology at Stanford’s Medical Center, and Dr. Jacques Cohen, the laboratory director at ART Institute of Washington at Walter Reed National Military Medical Center.

Legacy’s Kteily previously worked as a consultant focused on health & life sciences before serving as a senior manager at the World Economic Forum. Daniel Madero and Sarah Steinle, also Legacy co-founders, previously worked at Medifertil, a Colombian fertility clinic, and Extend Fertility, respectively.

In addition to Dadi and Legacy, other companies close to the space have recently secured notable investments including Hims, the provider of direct-to-consumer erectile dysfunction (ED) and hair loss medication, which raised a $100 million this year. Another seller of ED meds, Ro, has raised a total of $91 million. And Manual, an educational portal and treatment platform for men’s issues, raised a £5 million seed round in January from Felix Capital, Cherry Ventures and Cassius Capital.

Spacetech growth, the future of micromobility, and how to solve the hell of open offices

Is space truly within reach for startups and VC?

With the 50th anniversary of the moon landing taking place this past week, Darrell Etherington takes a temperature check of the current state of spacetech, chatting with startups like Wyvern and NSLComm. What he finds is actually a fairly positive picture — not only are there a huge number of original ideas and serious dollars flowing into the … space (couldn’t resist), but there are also clear trajectories to real products in the short-to-medium term. Writing about satellites:

Now, driven largely by miniaturization and manufacturing efficiency gains resulting from the ubiquity of home computing and smartphones, those components are a lot more affordable and a lot more available. High-quality optics can be had off the shelf for a relative song; antennas, solar cells, batteries and more have all dropped off a cliff in terms of manufacturing cost. Consumer hardware startups benefited from this trend as well, but it’s paying dividends to companies with higher-altitude ambitions, too.

[…]

Thanks to improvements in materials science, NSLComm was able to develop a proprietary technology to quickly deploy long communications antennas in orbit from relatively small craft, letting them offer high-bandwidth ground and air connectivity at a fraction of the cost needed by large satellite operators, while still maintaining favorable margins.

How top VCs view the new future of micromobility

Transportation into the cold vacuum of space isn’t the only hot zone for VC investment. Transportation itself is still getting a lot of love, but the investment theses are changing as more data comes in from the first wave of micromobility startups. At our Sessions: Mobility event, we had our VC reporter Kate Clark interview Sarah Smith of Bain Capital Ventures, Michael Granoff of Maniv Mobility, and Ted Serbinski of TechStars Detroit to discuss the future of this market, and we’ve now posted an exclusive edited transcript for Extra Crunch members.

How top VCs view the new future of micromobility

Earlier this month, TechCrunch held its annual Mobility Sessions event, where leading mobility-focused auto companies, startups, executives and thought leaders joined us to discuss all things autonomous vehicle technology, micromobility and electric vehicles.

Extra Crunch is offering members access to full transcripts key panels and conversations from the event, including our panel on micromobility where TechCrunch VC reporter Kate Clark was joined by investors Sarah Smith of Bain Capital Ventures, Michael Granoff of Maniv Mobility, and Ted Serbinski of TechStars Detroit.

The panelists walk through their mobility investment theses and how they’ve changed over the last few years. The group also compares the business models of scooters, e-bikes, e-motorcycles, rideshare and more, while discussing Uber and Lyft’s role in tomorrow’s mobility ecosystem.

Sarah Smith: It was very clear last summer, that there was essentially a near-vertical demand curve developing with consumer adoption of scooters. E-bikes had been around, but scooters, for Lime just to give you perspective, had only hit the road in February. So by the time we were really looking at things, they only had really six months of data. But we could look at the traction and the adoption, and really just what this was doing for consumers.

At the time, consumers had learned through Uber and Lyft and others that you can just grab your cell phone and press a button, and that equates to transportation. And then we see through the sharing economy like Airbnb, people don’t necessarily expect to own every single asset that they use throughout the day. So there’s this confluence of a lot of different consumer trends that suggested that this wasn’t just a fad. This wasn’t something that was going to go away.

For access to the full transcription below and for the opportunity to read through additional event transcripts and recaps, become a member of Extra Crunch. Learn more and try it for free. 

Kate Clark: One of the first panels of the day, I think we should take a moment to define mobility. As VCs in this space, how do you define this always-evolving sector?

Michael Granoff: Well, the way I like to put it is that there have been four eras in mobility. The first was walking and we did that for thousands of years. Then we harnessed animal power for thousands of years.

And then there was a date — and I saw Ken Washington from Ford here — September 1st, 1908, which was when the Model T came out. And through the next 100 years, mobility is really defined as the personally owned and operated individual operated internal combustion engine car.

And what’s interesting is to go exactly 100 years later, September 2008, the financial crisis that affects the auto industry tremendously, but also a time where we had the first third-party apps, and you had Waze and you had Uber, and then you had Lime and Bird, and so forth. And really, I think what we’re in now is the age of digital mobility and I think that’s what defines what this day is about.

Ted Serbinski: Yeah, I think just to add to that, I think mobility is the movement of people and goods. But that last part of digital mobility, I really look at the intersection of the physical and digital worlds. And it’s really that intersection, which is enabling all these new ways to move around.

GettyImages 1129827591

Image via Getty Images / Jackie Niam

Clark: So Ted you run TechStars Detroit, but it was once known as TechStars Mobility. So why did you decide to drop the mobility?

Serbinski: So I’m at a mobility conference, and we no longer call ourselves mobility. So five years ago, when we launched the mobility program at TechStars, we were working very closely with Ford’s group and at the time, five years ago, 2014, where it started with the connected car, auto and [people saying] “you should use the word mobility.”

And I was like “What does that mean?” And so when we launched TechStars Mobility, we got all this stuff but we were like “this isn’t what we’re looking for. What does this word mean?” And then Cruise gets acquired for a billion dollars. And everyone’s like “Mobility! This is the next big gold rush! Mobility, mobility, mobility!”

And because I invest early-stage companies anywhere in the world, what started to happen last year is we’d be going after a company and they’d say, “well, we’re not interested in your program. We’re not mobility.” And I’d be scratching my head like, “No, you are mobility. This is where the future is going. You’re this digital way of moving around. And no, we’re artificial intelligence, we’re robotics.”

And as we started talking to more and more entrepreneurs, and hundreds of startups around the world, it became pretty clear that the word mobility is actually becoming too limiting, depending on your vantage where you are in the world.

And so this year, we actually dropped the word mobility and we just call it TechStars Detroit, and it’s really just intersection of those physical and digital worlds. And so now we don’t have a word, but I think we found more mobility companies by dropping the word mobility.

Embedded finance, or why fintech mega VC rounds have become so common

Another day, another monster fintech venture round.

This morning, it was personalized banking app MoneyLion, which raised $100 million at a near unicorn valuation. Last week, it was N26, which raised another $170 million on top of its $300 million round earlier this year. Brex raised another $100 million last month on top of its $125 million Series C from late last year. Meanwhile, companies like payments platform Stripe, savings and investment platform Raisin, traveler lender Uplift, mortgage backers Blend and Better, and savings depositor Acorns have also raised massive new rounds this year.

That’s all on top of 2018’s record-breaking year for fintech, which saw $52.5 billion of investment flow into the space according to KPMG’s estimate.

What’s with all the money flowing into the fintech world? And what does all this investment portend not only for the industry and other potential entrants, but also for customers of financial services? The answer is that this new wave of fintech startups has figured out embedded finance, and that it is changing the entire economics of disruptive financial services.

First, this isn’t (really) about blockchain

Let’s get one thing out of the way right away, for whenever the topic of financial services and digital disruption come together, some blatherer always yells blockchain from the proverbial back row (often with a bit of foaming at the mouth I might add).

Lightspeed Venture Partners doubles its growth practice

Lightspeed Venture Partners, a firm behind the likes of BetterUp, Aurora, Goop and dozens of others, will allocate more capital to mature companies with the hiring of three new partners.

Adam Smith, Amy Wu and Arsham Memarzadeh join the Menlo Park-headquartered venture capital fund’s growth practice. The team is led by longtime partner Will Kohler and Brad Twohig, who joined LSVP in 2018 to amp up the firm’s late-stage efforts, leading a $1.25 billion investment in Epic Games only months after arriving from Insight Venture Partners.

“I think we will continue to add to the team as we see the market opportunity ahead of us, so we can better understand when and where to invest,” Twohig tells TechCrunch. “They are going out and helping us identify interesting new opportunities. We are really looking for outlier businesses. We aren’t trying to invest in any company. We want outlier founders, outlying companies with outlying performance.”

The new hires double the size of LSVP’s late-stage team and come shortly after the firm closed on $1.8 billion for two new funds. Last year, LSVP announced Lightspeed Venture Partners XII, a $750 million early-stage vehicle, and Lightspeed Venture Partners Select III, a $1.05 billion fund for late-stage follow-on fundings.

Lightspeed, historically an early-stage fund, has continued to move downstream as deal sizes swell across all stages. With fresh capital to deploy, LSVP is not only continuing to invest in existing portfolio companies but also backing companies for the first time as late as the Series E.

“We still think there are great opportunities to make investments with a strong return profile even at the late-stage,” Kohler tells TechCrunch, citing the buzzworthy financial technology business Carta as an example. “[Carta is] an exceptional company even at a growth-stage investment because it has so much potential to keep growing. We are convinced there will be venture-sized returns.”

In addition to Carta, which LSVP invested in at its Series E earlier this year, Lightspeed has made late-stage bets on the B2B sales platform Seismic, employee coaching service BetterUp, Indian hotel business Oyo and Indian B2B wholesale marketplace Udon.

“Some time ago it might not have made sense for us to do this,” Kohler said. “But as we followed the growth of our early-stage companies, we’ve realized the markets are getting bigger, the global demand is impacting the size these companies can get and we can invest at an entry point that’s later on and realize a great venture return.”

Kohler emphasized the firm’s global funds — Lightspeed operates venture funds in China and India — as helpful mechanisms for late-stage deal sourcing. He also noted the firm’s expansion into late-stage is a “natural extension of its original vision.”

Founded in 2000, Lightspeed’s four founding partners — Chris Schaepe, Barry Eggers, Ravi Mhatre and Peter Nieh — “understood the boring non-sexy elements of tech,” Kohler explained.

As for the newest additions, Wu joins from Discovery Inc., where she was chief financial officer and senior vice president of the company’s global digital division. She will be focused on scaling businesses within LSVP’s portfolio.

Smith, focused on high-growth enterprise and consumer investment opportunities, previously worked as a principal at Bain Capital Ventures and a lead operations manager at Uber. Finally, Memarzadeh, who will invest in product-driven software startups, spent the last five years at OpenView, a Boston-based venture firm.

Lime’s founding CEO steps down as his co-founder takes control

In an all-hands meeting this afternoon, the scooter and bike-sharing phenom Lime announced co-founder and chief executive officer Toby Sun would transition out of the C-suite to focus on company culture and R&D. Brad Bao, a Lime co-founder and long-time Tencent executive, will assume chief responsibilities, Lime confirmed to TechCrunch.

“Lime has experienced unprecedented growth in the global marketplace under the joint leadership of our co-founders Brad Bao and Toby Sun,” the company said in a statement provided to TechCrunch. “Fortunately, Lime’s structure allows for our executive leadership to be multipurpose and we are making a few changes to our team today to seize the opportunity ahead of us.”

Sun and Bao launched Lime together in late 2016. The San Mateo-based company had near-immediate success, attracting hundreds of millions in venture capital funding and reaching a valuation of more than $1 billion in only a year and a half’s time. Today, the company is valued at $2.4 billion and is expected to hit the fundraising circuit soon.

In addition to today’s CEO shake-up, Lime’s chief operating officer and former GV partner Joe Kraus has been promoted to the role of president. Kraus joined Lime full-time late last year after more than a decade at the venture capital arm of Alphabet.

Bao, given his Tencent tenure, seems like a natural choice to lead Lime into a more mature phase of business. Sun, a former investment director at Fosun Kinzon, has less operational experience than his counterpart, who was most recently the vice president of the Chinese conglomerate’s gaming decision.

News of Sun’s demotion comes hot off the heels of a fresh new marketing campaign, featured above, in which the Lime co-founders describe the scooter-sharing startup’s origin story and grand ambitions. The company, backed by Bain Capital Ventures, Andreessen Horowitz, Fidelity Ventures, GV, IVP and a slew of other top-notch investors, is active in more than 100 cities in the U.S. and 27 cities internationally. As of June, riders had taken more than 50 million trips on one of Lime’s vehicles.

OpenFin raises $17 million for its OS for finance

OpenFin, the company looking to provide the operating system for the financial services industry, has raised $17 million in funding through a Series C round led by Wells Fargo, with participation from Barclays and existing investors including Bain Capital Ventures, J.P. Morgan and Pivot Investment Partners. Previous investors in OpenFin also include DRW Venture Capital, Euclid Opportunities and NYCA Partners.

Likening itself to “the OS of finance”, OpenFin seeks to be the operating layer on which applications used by financial services companies are built and launched, akin to iOS or Android for your smartphone.

OpenFin’s operating system provides three key solutions which, while present on your mobile phone, has previously been absent in the financial services industry: easier deployment of apps to end users, fast security assurances for applications, and interoperability.

Traders, analysts and other financial service employees often find themselves using several separate platforms simultaneously, as they try to source information and quickly execute multiple transactions. Yet historically, the desktop applications used by financial services firms — like trading platforms, data solutions, or risk analytics — haven’t communicated with one another, with functions performed in one application not recognized or reflected in external applications.

“On my phone, I can be in my calendar app and tap an address, which opens up Google Maps. From Google Maps, maybe I book an Uber . From Uber, I’ll share my real-time location on messages with my friends. That’s four different apps working together on my phone,” OpenFin CEO and co-founder Mazy Dar explained to TechCrunch. That cross-functionality has long been missing in financial services.

As a result, employees can find themselves losing precious time — which in the world of financial services can often mean losing money — as they juggle multiple screens and perform repetitive processes across different applications.

Additionally, major banks, institutional investors and other financial firms have traditionally deployed natively installed applications in lengthy processes that can often take months, going through long vendor packaging and security reviews that ultimately don’t prevent the software from actually accessing the local system.

OpenFin CEO and co-founder Mazy Dar. Image via OpenFin

As former analysts and traders at major financial institutions, Dar and his co-founder Chuck Doerr (now President & COO of OpenFin) recognized these major pain points and decided to build a common platform that would enable cross-functionality and instant deployment. And since apps on OpenFin are unable to access local file systems, banks can better ensure security and avoid prolonged yet ineffective security review processes.

And the value proposition offered by OpenFin seems to be quite compelling. Openfin boasts an impressive roster of customers using its platform, including over 1,500 major financial firms, almost 40 leading vendors, and 15 out of the world’s 20 largest banks.

Over 1,000 applications have been built on the OS, with OpenFin now deployed on more than 200,000 desktops — a noteworthy milestone given that the ever popular Bloomberg Terminal, which is ubiquitously used across financial institutions and investment firms, is deployed on roughly 300,000 desktops.

Since raising their Series B in February 2017, OpenFin’s deployments have more than doubled. The company’s headcount has also doubled and its European presence has tripled. Earlier this year, OpenFin also launched it’s OpenFin Cloud Services platform, which allows financial firms to launch their own private local app stores for employees and customers without writing a single line of code.

To date, OpenFin has raised a total of $40 million in venture funding and plans to use the capital from its latest round for additional hiring and to expand its footprint onto more desktops around the world. In the long run, OpenFin hopes to become the vital operating infrastructure upon which all developers of financial applications are innovating.

Apple and Google’s mobile operating systems and app stores have enabled more than a million apps that have fundamentally changed how we live,” said Dar. “OpenFin OS and our new app store services enable the next generation of desktop apps that are transforming how we work in financial services.”