Proving that banking as a service is hotter than ever, Treasury Prime raises $40 million in Series C • TechCrunch

Treasury Prime co-founder and CEO Chris Dean believes the best outcomes for consumers will result from traditional banks and fintech working together.

The banking-as-a-service startup has worked to build relationships with both banks and fintechs. And Dean believes Treasury Prime’s ability to “keep both sides happy” has contributed to its ability to grow revenue by nearly 400% and is up more than 450% since raising a $20 million Series B in May 2021.

Unlike many fast-growing fintech startups, Treasury Prime has picked up speed when it comes to raising venture capital – and today announced a $40 million Series C funding round led by new investor BAM Elevate. Banc Funds and Invicta also participated in the financing, along with existing backers Deciens, QED and SaaStr. While declining to disclose valuation, Dean confirmed the fundraising was “an up-round.”

San Francisco-based Treasury Prime, which has raised about $73 million since its inception in 2017, started by building software tools that help banks automate and accelerate routine tasks. Over time, it has expanded its offer and says today it gives businesses of all sizes a way to integrate with banks, allowing them to offer new services, reduce the cost of deposits and ultimately generate more revenue. On the fintech side, the company claims to help startups with a range of services, including money transfer, risk mitigation and access to a chartered bank’s infrastructure.

The company plans to use its new capital to continue to build out its new integrated partner marketplace (similar to what Synctera does) and multi-bank network – which currently consists of 16 banks – as well as develop new products and services, including lending opportunities.

“Nbecause we have enough banks and they all work across a common open banking-style API that looks the same to all our banks – to our larger fintechs it looks like one giant network of banks,” said Dean. “At some point, we got enough banks here that we could attract more fintechs, and that really started this good cycle. As we had more fintechs, it became easier to add more banks.”

For example, he said, Treasury Prime has customers who can have agreements with four different banks and open accounts at all of those banks via “just one integration” instead of four separate ones.

“And it’s just this huge win for them,” Dean added. “We cone does real-time reconciliation during the day, and allows institutions to add features related to other bank accounts that no one else can do.”

In Dean’s view, banks are good at certain things, while fintechs are good at others.

“You should let each one of them do their own thing, and that’s in some ways what embedded banking means,” he said.

For example, Dean notes, fintechs are good at marketing building products and relationships with specific verticals. At the same time, the banks are good at complying with risk management.

Norman Chen, partner at BAM Elevate – which also counts Alloy, Fireblocks and Deel in its portfolio – notes that especially in today’s environment, companies looking to add financial services to their offerings are looking for best-in-class partners, whether they can be fintechs or banks, depending on their priorities and goals, which can change and evolve.

“To have a network is really best suited for this time frame where banks can have different strategies for how they think about deposits, how they think about growth, how they think about their loans,” Chen told TechCrunch in an interview. . “All of these elements can change … so by having a network of banks, fintechs can really pick and choose those banks that share similar goals and not be tied to one versus the other.”

Currently, Treasury Prime has around 100 employees.