Unit Raises $51m in Series B Round to Promote Easier Fintech Business

Unit Raises $51m in Series B Round to Promote Easier Fintech Business

The fintech boom has been accelerating innovation for payments and cross-border transactions. Banks and non-banking firms alike are adding a touch of fintech to their services. To this end, Unit, a fintech startup that creates enabling tools for companies to create fintech services, has gained more funding to expand its mission.

Unit announced it has raised $51 million in Series B round led by Accel. Existing investors Better Tomorrow Ventures, Aleph, Flourish Ventures, and TLV Partners also joined the round.

The company was designed to be the simple and robust platform to empower the next generation of fintech builders, and has grown fast since launching out of stealth last year. This means, companies can build banking products in minutes using Unit tools.

Having raised $18 million in December, the Series B round brought Unit’s total fund to nearly $70 million.

“The new round will help us expand into more financial products, more integrations and a richer feature set, including SDKs and front-end components. All of our initiatives, from new product features to content, are designed to make it even easier for companies to launch new banking products,” the company said in a statement.

To that end, Unit announced the launch of Unit Go, the first-in-market solution that will allow companies to create live bank accounts and issue physical and virtual cards in minutes. Founders and developers will now have the ability to sign up for a free account, build in Unit’s live environment, and instantly test their products using real funds. Unit Go is currently in beta and will be publicly available in the fall of 2021.

The company said it has seen deposit volume grow by over 300%, and banked end-customers by 600% in the last three months. The goal is to capitalize on this progress and expand its services to a wider pool of users, even amidst competition with other players, like Railbank, Treasury Prime and Stripe, in the booming fintech field.

“We continue to be inspired by what both young and established companies have built on Unit, and we plan to continue sharing their stories with the world,” it said.

Unit said its interaction with hundreds of builders has cemented its belief that the next decade in fintech will be defined by tech companies using their unfair advantage — the flywheel of distribution, trust, software, and data — to launch massively successful fintech products in their verticals. That thus sets the company on a mission to help these companies bring those products to life, unlock value, and expand financial access for all.

Unit was founded by Itai Damti and Doron Somech, who are using their tech development ideas from the previous startup they founded, to accelerate Unit’s growth. The duo previously co-founded — and bootstrapped — Leverate, a Tel Aviv-based B2B trading tech provider. Unit has dual headquarters in Tel Aviv and New York City.

For now, only about 20% of Unit’s customers are what might be considered true fintechs. The remaining 80% are companies that are not but rather want to embed banking as a service into their offering, Damti said.

He added that the company takes what was once “a very expensive and complex process of 18 months” that includes finding and managing a bank relationship, building a compliance team and building a tech stack “that gets you to a competitive banking offering, and turns it into one API and one dashboard that helps companies launch accounts cards, payments and lending within five weeks.”

“We are acting as a company that connects banks to the tech ecosystem and banks are critical vendors and partners to us, but we see them as a built-in element within Unit, because we believe that the most excellent experience in this ecosystem can only come from software companies,” Damti told TechCrunch.

He explained that Unit is technically distinct in that it is actually building a ledger, which he describes as “the most critical and sensitive part of the ecosystem.”

By owning the ledger and not delegating, he said, Unit is “able to offer a radically better experience.”

“As far as the transaction environment, the cleanliness of the data that we provide and the fees that our customers are able to control and tweak, owning that ledger piece is super critical for the experience,” Damti said.

With Unit rolling out the tools, making financial services easier, many companies are expected to get into the fintech business before 2022.

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