Fourthline locks down €50M to bring better ID checks and compliance tools to the finance sector

Fourthline, the RegTech leader that provides AI-powered and compliant KYC and AML solutions, has raised €50m from new and existing institutional investors.

The Fourthline platform provides banks and financial services providers with a complete suite of proprietary tech products that adhere to local KYC, AML and GDPR requirements in Europe and beyond. Fourthline’s AI-driven solutions unlock compliance for the entirety of the lifecycle, from onboarding, the verification and analysis, through to investigations and continuous KYC, in all stages of business development. 

Since its launch in 2018, the company has grown more than 80% yearly. Fourthline now employs over 270 people across The Netherlands, France, Spain and The UK; and works with European fintech leaders including N26, Trade Republic, Qonto and Scalable Capital; and other regulated financial institutions such as NN, Solaris and Western Union.

Krik Gunning, co-founder and CEO, says: “We are on a mission to help regulated entities fight ever more complex financial crime. The huge leaps forward in technology over the last decade have been a double-edged sword: while consumers benefit from easier and quicker access to banking products, the nefarious actors have leveraged technologies such as deepfakes and social engineering such as money mules to increase the sophistication of their fraudulence. At present, approximately €1.8trillion dollars are laundered every year.” 

Gunning continues, “In order to hold back the tide of financial crime, a raft of KYC, AML and anti-fraud technologies have been developed. Simultaneously, legislators have tried to keep up, which has increased the regulatory burden on companies. However, a lot of RegTech point-solutions do not truly alleviate the compliance burden on regulated entities as evidenced by the thousands of employees performing manual checks at banks that have deployed point solutions. At Fourthline, we provide financial institutions with a single, banking-grade solution for continuous, ‘lifetime’ financial compliance. This is what we do.”

Fourthline has taken a radically different approach to tech-enabled compliance by offering regulated institutions a single tech platform. The platform includes: 

• A proprietary technology that is fully developed in-house; explainable automation powered by ethical AI.

• A single API to eliminate complexity: Fourthline’s API eliminates the need for integrating multiple point solutions, and supports new geographies, products and user journeys. 

• A single, reusable core identity: establishing a single source of truth boosts quality and automation and eliminates the need to ask clients for the same information twice, significantly helping increase conversion and retention, and instead enrich it with additional information where necessary. 

• A product suite to cover all KYC and AML requirements, from initial onboarding, to daily AML monitoring, authentication, qualified electronic signatures, periodic reKYC, enhanced fraud investigations, document renewal and when necessary offboarding.

Radboud Vlaar, Managing Partner of Finch Capital, has increased his stake in this round after having led Fourthline’s previous round, investing along with new institutional investors. Vlaar comments, “We’re big believers in tackling the compliance challenges in this industry through a focused growth strategy leveraging a platform approach using proprietary technology.”

Read the TechCrunch article here: https://techcrunch.com/2023/04/03/ai-startup-fourthline-locks-down-54m-to-bring-better-id-checks-and-compliance-tools-to-the-finance-sector/