ModernFi Raises $4.5M as Banks Embrace Software to Source Deposits

ModernFi, which operates the first tech-enabled marketplace that allows banks to exchange deposits on demand, announced that it has “raised $4.5 million in seed funding.”

The investment round was “led by Andreessen Horowitz with participation from industry leaders across tech, finance, and government.”

ModernFi operates “a deposit marketplace that connects banks with excess deposits to banks that need funding.” By providing an outlet for excess deposits, the firm “helps banks manage balance sheet size and earn potential revenue.”

By providing deposits on demand, the firm “helps banks source liquidity and fund asset origination.”

With a modern tech stack built on a foundation of compliance and regulatory adherence, ModernFi’s offering “has quickly been embraced by banks of various sizes.”

ModernFi currently “works with U.S.-based banks ranging in size from $500 million to $100 billion in assets.”

Paolo Bertolotti, PhD, CEO and Cofounder of ModernFi, said:

“ModernFi has brought technology and transparency to a historically antiquated and opaque market. Banks, especially community and regional institutions, are pillars in their local communities, extending credit to folks that want to buy a house or get a car, as well as providing a safe place for people to keep their life savings. By allowing banks to source cost-effective funding on demand and manage balance sheet size, ModernFi is fundamentally improving how banks across the country operate.”

ModernFi intends “to use the funds to support and accelerate the firm’s growth. The firm intends to hire across engineering, bank partnerships, and compliance.”

In addition, ModernFi intends “to enhance its product offering by deepening its integrations with bank partners and expanding the types of funding available through its marketplace.”

David Haber, General Partner at Andreessen Horowitz, said:

“We’re thrilled to partner with Paolo, Adam, and the rest of the ModernFi team to build a more efficient deposit marketplace. After over a decade of being relatively staid, this market has become increasingly dynamic, laying a strong foundation for ModernFi’s business. With its tech-enabled marketplace, ModernFi is poised to be the interbank solution for those looking to monetize excess deposits and others that need access to balance sheet management on demand.”

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