Alloy’s founders explain how they built a fintech unicorn

by Anthony Ha and Lacey Wisdom

Alloy founders Charles Hearn, Tommy Nicholas, and Laura Spiekerman

More exciting news from the Eniac portfolio: Alloy just announced that it has raised $100 million in Series C funding — and with a post-money valuation of $1.35 billion, it’s officially a unicorn!

To learn more about Alloy’s success and how the company might evolve in the future, we interviewed CRO Laura Spiekemerman and CTO Charles Hearn (they founded Alloy with CEO Tommy Nicholas), along with Eniac co-founder Nihal Mehta — you can watch highlights of our conversation in the video below.

For those of you who aren’t familiar with Alloy, Laura explained that it offers an “identity decisioning platform that helps banks and fintech companies automate their identity decisions, approving more good customers and eliminating fraud,” as well as “a command center for identity,” centralizing crucial functions like know your customer and anti-money laundering.

Although Alloy is a unicorn now, Laura recalled that it was a bit of a struggle for the team to raise funding initially. She described pitching Silicon Valley investors who think they understand fintech, when in reality, “they might understand payments but they don’t understand fintech.”

“There’s actually a danger with investors who think they know a lot about your industry, because they’re quick to form an opinion, and I think that was the case for us,” Laura continued.

Alloy had better luck with Eniac, thanks to our generalist approach — which she summarized as, “Just believe in the founders, believe they have a certain amount of grit, that they have a certain background that means they can take a look at an industry and build exciting software for it.” (Sounds good to us!)

We also asked how Alloy has managed to stay nimble in an industry defined by regulation and bureaucracy.

“Being in financial services, we have a lot of requirements to do things a certain way,” Charles acknowledged, but he suggested that Alloy is always “second guessing, to some extent, what those requirements are for and if we can satisfy them another way and make our auditors happy without introducing any more red tape to the process.”

As for what the next few years will bring for fintech, Laura said that although Alloy got lucky with recent trends like “the rise of embedded fintech and banking-as-a-service … it’s not like we sat there in 2015 when we started the company saying, ‘That’s going to happen.’”

Still, she was willing to make a few predictions, all around the theme of decentralization.

“All these tools have made building financial services apps, for lack of a better word, so much faster, so much easier, so much safer,” she said. “I think you’re just going to see this spin-up of tons of different applications — a lot of niche banking you’re seeing now, serving niche audiences, serving niche products, the kind of modularization of banking products, where you now see ‘buy now pay later’ for everything, for every ticket size.”

If you want to hear more about how Alloy found product-market fit, check out Laura’s comments at our panel on that very topic from earlier this year.

We lead seed rounds in bold founders who use code to create transformational companies.