Plano-headquartered Alkami Technology, which bills itself as a leader in providing cloud-based digital banking solutions for banks and credit unions, has closed on a $140 million funding round. The fintech innovator said the financing follows several major growth milestones.
It puts Alkami’s total funding upwards of $400 million.
Alkami helps banks and credit unions provide mobile services to consumers and small businesses. Stephen Bohanon, who launched the business in 2009 and is now chief strategy and sales officer, puts it simply: “Our platform simplifies money movement and financial wellness, and provides deep user insights with our proprietary data engine,” he previously told us.
Last year, Bohanon predicted that Alkami’s next milestone would be 10 million contracted users and $100 million in revenue for 2020. That was a big jump from bringing in $52.3 million in revenue in 2018.
But, the fast-growing fintech has done it: Last month, it reached nearly 10 million digital users under contract and crossed more than $130 million of annual recurring revenue under contract. That news came after Alkami added its 165th client to the platform.
“Our clients are among the best performing and fastest growing FIs in the country, in part due to the strength and velocity of our platform, solutions and ecosystem,” CEO Mike Hansen said in a statement. “Together we are creating and delivering winning digital solutions to our clients’ customers, members and businesses.”
Alkami’s latest funding was led by D1 Capital Partners, with participation from Fidelity Management & Research Company, Franklin Templeton, and Stockbridge Investors. Goldman Sachs & Co. served as the sole placement agent.
According to Daniel Sundheim, founder of D1 Capital Partners, his investment firm conducted deep research and saw that Alkami was a clear industry leader in the digital banking space. He credits the company with earning the trust of hundreds of financial institutions and millions of users.
“Our mission at D1 is to back the world’s best companies and management teams,” he said in a statement. “We have been impressed by the company’s uncompromising focus and bold investments and expect its innovation and leadership to continue.”
But in August, Alkami raised another $53 million, as reported by the DBJ.
2019 was Alkami’s 10th anniversary as a company, but for the fast-growing fintech this is just the beginning.
CEO Mike Hansen and Founder Bohanon have built an intentional workplace culture of Alkamists at the company’s Plano home base around the idea that “business innovation is very simply the focus of the human capacity to create or improve products, solutions, and business models.”
They compare Alkami’s model to how water and the sun are essential to life—innovation is the source of all human change, improvement, and progress. Since its founding, Alkami has received some of the highest app store ratings in digital banking.
The latest financing will continue to fuel growth, especially during a time when many are turning to digital solutions amidst the COVID-19 pandemic. Alkami says it enables clients to “grow confidently, adapt quickly, and build thriving digital communities poised for growth.”
“We are proud to add world-class crossover investors to our strong existing investor base, supporting Alkami’s mission,” Hansen said in a statement. “We inspire and power the digital strategies of financial institutions as they seek to grow confidently and build thriving digital communities.”
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