Paying back a friend on Venmo. Buying stocks on Robinhood. Checking your bitcoin balance on Coinbase. A lot of your financial life is quietly powered by Plaid, a platform that provides the infrastructure to seamlessly and securely connect financial apps with consumer bank and credit card accounts.
We are excited to announce that Norwest is investing in Plaid’s $250 million Series C round.
Founded in 2012, Plaid powers the modernization of fintech by providing the plumbing to facilitate the flow of financial information from banks to their customers. Zach Perret and William Hockey came up with the idea when they were building their own consumer-facing fintech application, realizing that the software infrastructure for financial services tools was severely lacking. Today, they have built both a foundational platform and one of the largest financial data networks, with connections to more than 10,000 banks and credit unions and thousands of applications that rely on Plaid for financial information.
Driving a Paradigm Shift
A decade ago, most consumers relied on a single bank for the majority of their financial services, and transactions were often done in person. Nowadays, consumers increasingly rely on non-bank applications to manage their financial lives, often using multiple financial applications that each cater to a specific financial need.
Plaid has been at the center of this paradigm shift, enabling seamless financial services online through their APIs. Their technology has powered the fintech boom by making it easier and cheaper for developers to deliver high-quality experiences to end-users.
A Growing Market Opportunity
Global fintech VC investments have increased steadily between 2013 and 2017 from $3.7b to $16.5b and 2018 will close as another record year. Despite the emergence of numerous fintech unicorns, it is still in the early innings. Significant opportunity remains for new entrants to take market share from older, larger financial companies that have market caps in excess of $50b+.
Plaid is no exception. The company has only just begun to scratch the surface of a large and rapidly growing multi-billion-dollar market, and its value proposition is only growing stronger over time as the world continues to digitize. We see enormous potential in adjacent markets as the decoupling of the single primary bank model continues. Internationally, we see tremendous opportunity for Plaid as well. Strong market tailwinds, such as General Data Protection Regulation (GDPR) and Open Banking initiatives in regions of Europe and Australia, make Plaid more integral as consumers demand more control over their data.
Partnering with a Strong Team
Norwest is committed to investing in sharp, visionary founders who have built exceptional teams. We’ve been impressed with Zach and William and their mission to democratize data to provide enhanced experiences and better access for consumers. We’re excited to see Zach and William build the next-generation global financial network and create one of the most disruptive fintech companies of this generation.
At Norwest, we’ve had an eye on fintech for a while, investing in innovative platforms such as our Series A investment in Lending Club. We continue to be passionate about the market and the opportunities to invest in founders that are disrupting how consumers interact with traditional financial service providers.
We’re thrilled to welcome Zach, William, and the Plaid team to the Norwest family.