Latest news with #ZachPerret
Yahoo
27-05-2025
- Business
- Yahoo
The CEO of a $6 billion fintech explains how the huge risk he took with thousands of banks paid off big
Plaid's CEO said the company made a risky gamble in its early days. Plaid pulled user data from 12,000 banks using screen scraping. Some of the company's early work with banks was "antagonistic," said Zach Perret. Before fintech company Plaid became an essential link between banks and digital finance apps like Venmo, Robinhood, and Coinbase, its founders made a risky gamble. Founded in 2013, Plaid's leaders recognized a gap. While consumers had the right to access their financial data, banks didn't have official application program interfaces for companies like Plaid to access the data on behalf of their customers. To get in, Plaid relied on a practice known as "screen scraping," essentially logging into users' bank accounts with their usernames and passwords to retrieve data. Screen scraping can raise privacy and security concerns because it requires sharing sensitive login credentials and bypasses banks' direct control over the data. On an episode of the "Acquired" podcast published Tuesday, Plaid's CEO, Zach Perret, said the company scraped data from 12,000 banks. "Doing this at scale is very complex," Perret said. He said some of Plaid's work with banks was "very collaborative," while other work was "a little bit more antagonistic." Some banks were frustrated that investing apps like Robinhood even existed — and that resistance made it harder for Plaid to work with them. "Broadly, our goal was always to partner with the banks," he said. "Many of the banks actually came to us and said, 'Great, we'd like to move to an API. We haven't built it yet. Please just screen scrape us,'" he added. In 2021, Plaid agreed to pay $58 million to settle a class-action lawsuit over data privacy. The case, filed in California, consolidated five lawsuits brought by consumers who said Plaid accessed their bank account data without their knowledge. The suit also said that Plaid sold user data — a claim the company has denied. In 2020, Plaid publicly committed to moving 75% of its data volumes to APIs, not screen scraping, by the end of 2021. "At this point, we have the vast majority of our data coming from API-driven integrations," Perret said on the podcast, adding that banks have built their own APIs. Plaid is now in a "much more long-term sustainable technical infrastructure state," he said. Perret said that he was initially skeptical about whether people would want to link their bank accounts to apps like Venmo. "It turns out people did it in droves," he said. "It was a chicken and egg thing," Perret said. "We had to build the less scalable integrations before we could get to the more scalable ones." Last month, Plaid raised $575 million at a $6.1 billion valuation, in a round led by Franklin Templeton. Perret and Plaid did not respond to a request for comment by Business Insider. Read the original article on Business Insider
Yahoo
27-05-2025
- Business
- Yahoo
The CEO of a $6 billion fintech explains how the huge risk he took with thousands of banks paid off big
Plaid's CEO said the company made a risky gamble in its early days. Plaid pulled user data from 12,000 banks using screen scraping. Some of the company's early work with banks was "antagonistic," said Zach Perret. Before fintech company Plaid became an essential link between banks and digital finance apps like Venmo, Robinhood, and Coinbase, its founders made a risky gamble. Founded in 2013, Plaid's leaders recognized a gap. While consumers had the right to access their financial data, banks didn't have official application program interfaces for companies like Plaid to access the data on behalf of their customers. To get in, Plaid relied on a practice known as "screen scraping," essentially logging into users' bank accounts with their usernames and passwords to retrieve data. Screen scraping can raise privacy and security concerns because it requires sharing sensitive login credentials and bypasses banks' direct control over the data. On an episode of the "Acquired" podcast published Tuesday, Plaid's CEO, Zach Perret, said the company scraped data from 12,000 banks. "Doing this at scale is very complex," Perret said. He said some of Plaid's work with banks was "very collaborative," while other work was "a little bit more antagonistic." Some banks were frustrated that investing apps like Robinhood even existed — and that resistance made it harder for Plaid to work with them. "Broadly, our goal was always to partner with the banks," he said. "Many of the banks actually came to us and said, 'Great, we'd like to move to an API. We haven't built it yet. Please just screen scrape us,'" he added. In 2021, Plaid agreed to pay $58 million to settle a class-action lawsuit over data privacy. The case, filed in California, consolidated five lawsuits brought by consumers who said Plaid accessed their bank account data without their knowledge. The suit also said that Plaid sold user data — a claim the company has denied. In 2020, Plaid publicly committed to moving 75% of its data volumes to APIs, not screen scraping, by the end of 2021. "At this point, we have the vast majority of our data coming from API-driven integrations," Perret said on the podcast, adding that banks have built their own APIs. Plaid is now in a "much more long-term sustainable technical infrastructure state," he said. Perret said that he was initially skeptical about whether people would want to link their bank accounts to apps like Venmo. "It turns out people did it in droves," he said. "It was a chicken and egg thing," Perret said. "We had to build the less scalable integrations before we could get to the more scalable ones." Last month, Plaid raised $575 million at a $6.1 billion valuation, in a round led by Franklin Templeton. Perret and Plaid did not respond to a request for comment by Business Insider. Read the original article on Business Insider
Business Insider
27-05-2025
- Business
- Business Insider
The CEO of a $6 billion fintech explains how the huge risk he took with thousands of banks paid off big
Before fintech company Plaid became an essential link between banks and digital finance apps like Venmo, Robinhood, and Coinbase, its founders made a risky gamble. Founded in 2013, Plaid's leaders recognized a gap. While consumers had the right to access their financial data, banks didn't have official application program interfaces for companies like Plaid to access the data on behalf of their customers. To get in, Plaid relied on a practice known as "screen scraping," essentially logging into users' bank accounts with their usernames and passwords to retrieve data. Screen scraping can raise privacy and security concerns because it requires sharing sensitive login credentials and bypasses banks' direct control over the data. On an episode of the "Acquired" podcast published Tuesday, Plaid's CEO, Zach Perret, said the company scraped data from 12,000 banks. "Doing this at scale is very complex," Perret said. He said some of Plaid's work with banks was "very collaborative," while other work was "a little bit more antagonistic." Some banks were frustrated that investing apps like Robinhood even existed — and that resistance made it harder for Plaid to work with them. "Broadly, our goal was always to partner with the banks," he said. "Many of the banks actually came to us and said, 'Great, we'd like to move to an API. We haven't built it yet. Please just screen scrape us,'" he added. In 2021, Plaid agreed to pay $58 million to settle a class-action lawsuit over data privacy. The case, filed in California, consolidated five lawsuits brought by consumers who said Plaid accessed their bank account data without their knowledge. The suit also said that Plaid sold user data — a claim the company has denied. In 2020, Plaid publicly committed to moving 75% of its data volumes to APIs, not screen scraping, by the end of 2021. "At this point, we have the vast majority of our data coming from API-driven integrations," Perret said on the podcast, adding that banks have built their own APIs. Plaid is now in a "much more long-term sustainable technical infrastructure state," he said. Perret said that he was initially skeptical about whether people would want to link their bank accounts to apps like Venmo. "It turns out people did it in droves," he said. "It was a chicken and egg thing," Perret said. "We had to build the less scalable integrations before we could get to the more scalable ones." Last month, Plaid raised $575 million at a $6.1 billion valuation, in a round led by Franklin Templeton.
Associated Press
15-04-2025
- Business
- Associated Press
Friday Harbor raises $6M to help community mortgage lenders match the speed and efficiency of industry giants
- AI-powered platform enables lenders of all sizes to close loans faster, reduce costs and ensure compliance in real time - SEATTLE, Wash., April 15, 2025 (SEND2PRESS NEWSWIRE) — Friday Harbor, an AI-powered platform that helps loan officers assemble complete and compliant loan files in real time, today announced the completion of a $6 million seed round. The round was led by Abstract Ventures, a San Francisco-based venture firm with $1.5 billion in assets under management and a track record of backing breakout companies including Rippling, xAI, Hebbia, Brigit and Hippo (NYSE: HIPO) and Mischief, an early-stage VC fund co-founded by Plaid CEO Zach Perret. Also participating in the round were Wischoff Ventures, a VC firm founded by Blend (NYSE: BLND) alum Nichole Wischoff; and the AI2 Incubator, a technical incubator born from the Allen Institute for AI (AI2). With Friday Harbor's platform, lenders of all sizes can leverage AI to read and interpret borrower documents, generate a borrower-specific needs list, underwrite files and flag potential conditions—all in real time. Each flagged issue includes a suggested resolution, enabling loan officers to take action with a single click. By compressing what typically takes weeks of back-and-forth into just minutes, Friday Harbor reduces downstream friction and accelerates time to close. Friday Harbor was founded with a mission to make advanced AI tools accessible to all lenders—not just those with the biggest budgets. By replacing outdated, manual workflows and automating key underwriting steps, the platform empowers banks, credit unions and independent mortgage banks (IMBs) to match—or even surpass—the speed, cost-efficiency and borrower experience of mega-lenders like Rocket Companies and United Wholesale Mortgage, which together accounted for one-fifth of all IMB originations in 2024, according to Home Mortgage Disclosure Act data. 'I've always believed AI could be the great equalizer in mortgage lending,' said Friday Harbor CEO and Co-founder Theo Ellis. 'Thousands of lenders deserve access to the same tools as the mega-lenders—and in many cases, they're now doing things the biggest players can't. That's what happens when you give lenders technology built by people who truly understand both AI and mortgage.' Early adopters of Friday Harbor confirm the system's ability to address costly 'stare and compare' tasks and mitigate errors that slow loan production: Friday Harbor was founded by Ellis and Jesse Collins (CTO) and launched in 2024 with support from the AI2 Incubator and CoFound Partners. Ellis was previously head of U.S. growth and an early employee at machine learning fintech Pagaya Technologies (NASDAQ: PGY), where he helped launch multiple new consumer credit verticals for the company. Collins previously held senior engineering roles at leading fintech companies including Affirm (NASDAQ: AFRM) and Zillow (NASDAQ: Z), where he specialized in applying artificial intelligence to fraud detection and underwriting systems. The $6M seed round will support the growth of Friday Harbor's engineering team and support integrations with leading mortgage LOS and point-of-sale platforms—paving the way for more lenders to automate file setup, accelerate underwriting and compete directly with the largest lenders in the country. About Friday Harbor Friday Harbor is an AI-powered platform that helps loan officers assemble complete and compliant loan files in real time. The company combines deep fintech expertise with cutting-edge artificial intelligence to remove complexity, slash origination costs and deliver a better borrower experience. For more information, visit Tags: #mortgagetech #AI #fintech #seedfunding #venturecapital LOGO link for media: NEWS SOURCE: Friday Harbor ### MEDIA ONLY CONTACT: (not for publication online or in print) Leslie W. Colley Depth for Friday Harbor [email protected] (678) 622-6229 ### Keywords: Mortgage, Friday Harbor Inc, AI-powered platform that helps loan officers, SEATTLE, Wash. This press release was issued on behalf of the news source (Friday Harbor) who is solely responsibile for its accuracy, by Send2Press® Newswire. Information is believed accurate but not guaranteed. Story ID: S2P125538 APNF0325A To view the original version, visit: © 2025 Send2Press® Newswire, a press release distribution service, Calif., USA. RIGHTS GRANTED FOR REPRODUCTION IN WHOLE OR IN PART BY ANY LEGITIMATE MEDIA OUTLET - SUCH AS NEWSPAPER, BROADCAST OR TRADE PERIODICAL. MAY NOT BE USED ON ANY NON-MEDIA WEBSITE PROMOTING PR OR MARKETING SERVICES OR CONTENT DEVELOPMENT. Disclaimer: This press release content was not created by nor issued by the Associated Press (AP). Content below is unrelated to this news story.
Forbes
03-04-2025
- Business
- Forbes
Plaid Raises $575 Million In Funding At $6.1 Billion Valuation
Plaid CEO Zach Perret is raising money to cover an upcoming tax bill and to let employees sell some of their Plaid stock. San Francisco-based Plaid, whose main business is helping fintechs and other companies connect to consumers' bank accounts, is raising $575 million in a deal that values it at $6.1 billion, down more than 50% from the $13.4 billion it reached in 2021. The investment is being led by large asset management firms including Franklin Templeton, Fidelity Management and Research and BlackRock, with venture capital firms NEA and Ribbit also investing. A spokesperson for the 12-year-old company says most of the proceeds will be used to cover tax liabilities that will come due over the next few years, when employees' restricted stock units (RSUs)—a form of equity compensation where a business promises to grant you stock at a future date–vest and convert into common stock. Plaid will use a 'small portion' of the $575 million fundraise to buy back stock from employees in a tender offer, letting them cash out a small part of their Plaid stock, according to a spokesperson. After Plaid pays for its coming tax liability and the employee tender offer, it will use whatever is left of the $575 million to help fund its business, though it expects that to be 'a minimal amount.' Stripe took a similar step in March 2023 with a $6.5 billion tender offer that allowed employees to sell their private shares in the company, and it has done at least two more tender offers since then. In recent years, Plaid has expanded beyond its core bank-account-linking features into three new lines of business: credit-risk analytics, fraud prevention and pay-by-bank. That has helped reverse the growth slowdown the company saw in 2023, when it expanded just 12%. In 2024, its revenue rose 25% and exceeded $300 million, and its gross profit margin was roughly 80%, according to a person familiar with its business. The company still wasn't profitable on a generally accepted accounting principles (GAAP) basis. The fintech market has improved notably since it began on a downward trajectory in 2022. In the first quarter of 2025, fintechs raised roughly $10.3 billion in funding globally, according to CB Insights, the highest quarterly total since the first quarter of 2023. Digital bank Chime and buy-now, pay-later giant Klarna are planning to go public over the next few months, but Plaid is unlikely to try to IPO this year. 'Our hope is that we will get there in the next couple years, but no plans for a 2025 IPO,' Plaid CEO Zach Perret told Bloomberg in January. Last month, The Information reported that Plaid was planning a fundraise at a valuation of roughly $6 billion.
