Synctera, a new solution for partnership banking at scale, has announced the launch of its platform out of stealth, along with $12.4M in seed funding. The round was led by Lightspeed, with support from Diagram Ventures and strategic angel investors including Zachary Perret, CEO of Plaid; Max Levchin, founder and general partner at SciFi VC; Alexa Von Tobel, founder of LearnVest, and Inspired Capital; Henry Ward, CEO at Carta; and more.
Synctera connects community banks and fintechs, making an otherwise complicated partnership easier and more streamlined. At launch, Synctera is announcing its first match with Coastal Community Bank, a local bank serving the greater Puget Sound community, and One, a new digital banking platform fostering financial wellness.
Prior to Synctera, these smaller banks and credit unions were often reluctant and also unable to form potential partnerships due to a lack of technical or operational resources. There’s a strong concern about regulatory compliance of the fintechs and being able to manage, reconcile and bill with them results in a lot operational overhead and complexity. Now with Synctera, community banks can focus on serving their communities while also enabling their fintech counterparts to offer FDIC-insured mobile checking, debit cards, savings accounts or innovations in payments to their prospective customers.
“There has been immense demand from both fintechs and community banks for an easier way to partner, but no great answers have emerged until now,” said Peter Hazlehurst, CEO and co-founder of Synctera. “Like most small businesses, community banks have been hit hard by Covid-19. At Synctera, we hope to further diversify community banks’ revenue streams, enabling them to do what they do best—support their local towns and cities, while allowing them to grow at scale.”
Synctera recognises there is no one-size-fits-all approach for community banking or innovative fintech partnerships and applies a personalised touch to each match. Synctera’s diverse marketplace of banks and fintech companies helps to ensure that each partnership is a compatible match, and the parties align on geography, brand ethos, and desired business goals. In time for the launch, Synctera helped one of Coastal Community Bank’s existing fintechs, the digital banking platform ‘One,’ launch on the new platform, further assisting Coastal in its ability to scale up and offer backend as a service (BaaS) to its fintech customers.
“When we originally started working with fintechs, we were not set up to handle the amount of backend work needed to manage our relationships,” said Eric Sprink, President/CEO of Coastal Community Bank. “Synctera has allowed us to focus our energy on serving our core market by helping us with partner management. By launching with Synctera, we’re expecting to be able to double the number of fintech companies we take on. ”
Brian Hamilton, CEO of One, is an early adopter and was able to quickly integrate to the Synctera system. “We were impressed with how easy it was to get up and running with Synctera and look forward to using the dashboard and reconciliation tools to improve efficiency and help with compliance.”
Demand for Synctera’s solution is apparent in both the speed at which they matched their first fintech-bank pairing and also in its wide range of enthusiastic venture capital and angel investor supporters. The Synctera solution is poised at launch to create more beneficial partnerships, allowing community banks and fintechs to begin shaping the landscape of tomorrow’s banking, together.
“At Lightspeed, we have spent a lot of time investigating the financial infrastructure stack, in particular, banking as a service,” said Ansaf Kareem, Lead Investor at Lightspeed and Board Member at Synctera. “When I came across Synctera, it was immediately obvious that the company was uniquely positioned to unlock real value in the ecosystem. We are at a critical crossroads in the ecosystem where banks and fintechs are eager to partner with each other, and Synctera is providing that bridge. Synctera is rapidly becoming the foundational infrastructure layer for the financial services of the future.”