Chris Dean, founder and CEO of Treasury Prime, thinks that cooperation between established financial institutions and new fintechs would be beneficial for customers.
The banking-as-a-service company has made efforts to network with traditional financial institutions and innovative fintechs. As a result, Dean thinks Treasury Prime’s “ability to keep both parties satisfied” is a big reason why the company has been able to increase its income by almost 400% and its accounts by more than 450% after it secured a $20 million Series B in May of 2021.
Treasury Prime, in contrast to many rapidly expanding fintech businesses, has taken its time obtaining venture money, and it has now announced a $40 million Series C fundraising round headed by new partner BAM Elevate. New investors Banc Funds and Invicta joined previous investors Deciens, QED, and SaaStr in this round of funding. In spite of Dean’s refusal to provide valuation, he did acknowledge that the round of funding was “an up round.”
Location: San Francisco Since its establishment in 2017, Treasury Prime has funded over $73 million to develop software tools that assist financial institutions in automating and speeding up mundane processes. It has grown over time to the point that it now claims to provide a means by which companies of any size may interface with banks in order to provide additional services to their customers, reduce the cost of deposits, and increase their bottom line. The firm promotes itself as a fintech partner to startups by offering services including wire transfers, risk management consulting, and access to the backend systems of a licenced bank.
The funding will be used to expand the company’s multi-bank network, which now consists of 16 banks, and to create additional goods and services, such as loan choices, in a manner similar to that of Synctera.
To the larger fintechs, “it seems like one enormous network of banks” because “now that we have enough institutions,” Dean said, “and they’re all operating over a common open banking type API that looks the same for all our banks.” To paraphrase, “at some point, we had enough banks here to attract other fintechs, and that really launched this positive cycle. The more fintechs we had, the simpler it was to bring on additional banks.
He used the example of Treasury Prime customers who have relationships with four banks but want to create accounts with all four via “simply one integration” rather than four separate procedures.
And that’s a major victory for them,” Dean said. Our ability to perform daily reconciliation in real time and to facilitate the addition of features tied to external bank accounts is unparalleled.
Dean believes that banks and fintechs both have their strengths and weaknesses.
To paraphrase what he stated, “You should let each one of them do their own thing,” and this is what embedded banking entails.
Dean points out that fintechs, in particular, excel at selling their goods to and developing connections with very specialised industries. In the same time, financial institutions excel at maintaining regulatory compliance in risk management.
Partner at BAM Elevate Norman Chen says that in the current climate, companies intending to add financial services to their offerings are “searching for best-in-class partners,” which might be fintechs or banks depending on the goals and ambitions of the company.
“Having a network really is best appropriate for this time period because banks may have various strategies as to how they are thinking about deposits, how they are thinking about growth, and how they are thinking about their loans,” Chen told TechCrunch. Due to the uncertainty surrounding these factors, “fintechs may actually pick and choose the banks who share similar aims and not be bound to one over the other” via a banking network.
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