Passfort Secures $16.2M Funding for KYC and AML Solutions

PassFort Secures $16.2 Million Series A Funding

PassFort, a London-based SaaS company specializing in compliance solutions for KYC (Know Your Customer) and AML (Anti-Money Laundering) requirements, has successfully completed a $16.2 million Series A funding round. The investment was spearheaded by U.S. growth equity firm Level Equity.

Investment Details and Existing Backers

The funding round saw participation from PassFort’s current investors, including OpenOcean, Episode 1, and Entrepreneur First. A portion of the Series A, totaling $4.89 million, was provided in the form of venture debt by Shard Credit Partners.

Customer Base and Market Focus

PassFort currently serves a total of 54 customers, with a significant concentration within the digital payments sector. The company’s SaaS platform is also utilized by businesses operating in foreign exchange, banking, and the cryptocurrency space. Recent acquisitions of notable clients, such as Curve and WorldRemit, were highlighted.

Strategic Use of Funds

The newly acquired capital will primarily be allocated towards accelerating global expansion. PassFort has already appointed a new C-suite executive to lead this international growth initiative.

Furthermore, the company intends to bolster its teams in business development and marketing. Increased investment is planned across marketing, sales, and customer support functions to facilitate scaling operations.

Product Development and Innovation

“We are focused on evolving our solution to address the challenges presented by the evolving digital economy and the associated security threats,” states Donald Gillies, CEO and co-founder of PassFort. “This involves substantial investment in our new compliance policy cloud, integrations with leading CRM and transaction monitoring systems, and the development of a data science team capable of delivering real-time insights.”

Over the past year, PassFort has experienced approximately a 2.5x increase in revenue.

Impact of COVID-19 and Regulatory Landscape

Gillies attributes the increased adoption of compliance tools to the acceleration of digital transformation spurred by the COVID-19 pandemic. Fintech companies and regulated businesses are actively seeking to optimize their customer onboarding and risk monitoring processes.

He also notes a concurrent rise in cybercrime and sophisticated financial crime, driving demand for robust compliance solutions. The number of new regulations announced since the onset of the pandemic has also increased significantly; estimates indicate over 1,330 COVID-19 related regulatory announcements were made globally by August 2020.

Platform Capabilities and Features

PassFort’s platform provides a continuous, up-to-date view of risk. It offers a centralized location for managing customer profiles and maintaining audit records.

The SaaS solution also monitors efficiency, identifying potential bottlenecks in the onboarding process to enhance customer experience and support compliance teams.

Integration and Accessibility

PassFort’s integration model is designed for flexibility, enabling data ingestion from any provider and interoperability with existing systems. Currently, the platform features pre-built connectors to over 25 data providers.

A single API is available for seamless integration with a customer’s existing back-office infrastructure.

Low-Code/No-Code Approach

The SaaS platform emphasizes a “low to no-code” approach, increasing accessibility and catering to organizations with complex compliance needs – including those with multiple customer types, product lines, and jurisdictional requirements. A drag-and-drop interface facilitates the configuration of complex workflows through a smart policy builder.

Competitive Landscape

PassFort identifies Dublin-based Fenergo as its primary competitor. However, the company is focused on a broader market, positioning its product as a “Salesforce for compliance teams” with the ambition of reaching every financial crime and compliance team worldwide.

Level Equity’s Perspective

Charles Chen, partner at Level Equity and now a member of PassFort’s board of directors, commented: “Financial institutions are facing exponential growth in business volumes and data, which complicates regulatory compliance. Simultaneously, we’ve seen a surge in sophisticated financial crime as financial systems become increasingly digitized.”

“PassFort addresses this challenge with a next-generation RegTech solution that balances speed, compliance, and automation, enabling a seamless customer onboarding experience and best-in-class monitoring. We are excited to partner with a leader in this space and support their future growth.”