Robinhood founder invests in $20 million fund raise of regtech FrankieOne

Karthik Subramanian

FrankieOne, the regtech based out of Australia, has raised $20 million in its Series A funding round that had some celebrity investors including Robinhood founder and CEO Vlad Tenev as well as Monzo founder Tom Blomfield.

This latest round of funding shows the kind of demand that is being expected of regtechs in the future as the financial ecosystem undergoes a massive change and the regulators are about to change the regulations and laws governing the financial services in a major manner to cope up with the changes. This is going to place a lot of pressure on fintech and other financial services companies to keep pace with the changing regulations as more of the services go digital. Digitalization has led to a situation where the business no longer needs to meet the client in person at any point in time and the clients are also spread far and wide in different parts of the world. The regulations in different regions vary widely and so do the documents that are needed for verification of clients. This has led the businesses to seek third parties to help them with compliance and the spurt in demand for regtechs has led to their valuations hitting astronomical levels.

FrankieOne had started as a neobank but later pivoted to focus on KYC, KYB, ID verification, AML, fraud, and credit tools and brought all of these within a single platform for banks and other fintech and this has helped them to ease their customer onboarding process.

FrankieOne CEO Simon Costello, said: “Regulatory and technical challenges are often a major roadblock in a fintech’s ability to rapidly scale internationally. Our mission is to create a platform that provides fintech with the convenience of consuming the world’s identity verification and fraud-prevention services via a single unified API. This allows fintechs to “switch on” geographies and services as they need, enabling them to focus on innovation and their core business.”

It is reported that the company has been experienced 20x growth in the last few months with around 50% of its clients being from outside Australia and this includes banks, fintechs, digital exchanges, and other such platforms. The new funds that have been raised would be actively used for further expansion and growth outside of Australia and the company has also said that it would be expanding its product offering to include transaction monitoring. Regtech is an industry that can afford to do a lot of automation as it would help to remove a lot of manual verification and associated errors. So, the need for upgrades and innovations is available for the industry which is probably why such companies attract a lot of investor interest. With the advent of cryptocurrencies, the need for regtechs and compliance would only be more in the future.

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