New York City-based Goldman Sachs Investment Partners teamed up with San Francisco startup Plaid Technologies to raise $44 million in fundraising for the FinTech enterprise. Plaid Technologies, started in 2012 and launched publicly in 2015, works to build infrastructure that creates a bridge between applications and their users’ bank accounts, making the world of financial technology safer, more manageable, and easier to understand. Plaid has enabled apps such asVenmo, Gusto, and charity:water to connect to their users’ bank accounts, where they can then see their clients’ balances and authenticate the accounts, making the entire process safer and easier for all parties involved.
Plaid may be a relatively young company, but they are generating a lot of attention and drawing plenty of users. Based in San Francisco’s financial district, Plaid’s staff of 36 has already created six products, and over 6 billion transactions have been analyzed. Plaid supports the top thirteen banks in the United States and has relationships with hundreds of other financial institutions.
Plaid has faced tough questions about user privacy, Christopher Dawe co-Head of the bank’s venture capital and growth team, voiced Goldman Sachs’ approval of Plaid’s work. “Plaid is leading the way in making the next generation of financial technology possible by serving as the data layer between financial institutions and applications,” Dawe said in a statement. We spent a great deal of time around this [data privacy] issue. There is a tremendous focus on consumer privacy and data, but we came away from meetings [with Plaid management] feeling good about what they’re doing in terms of privacy.”
Goldman Sachs is not the only company to invest in Plaid. Previous investors include Google Ventures, New Enterprise Associates Inc., Spark Capital, and BoxGroup. The money raised will go towards Plaid’s growth into international markets, as well as upgrading their products and creating closer relationships with financial institutions. The Plaid investment marks Goldman Sachs’ ninth investment from a $1.25 billion fund raised in 2015, and their third investment of 2016.