Password-less data connectivity startup Rightfoot raises $15 million
Rightfoot, a password-less data connectivity startup for the financial services industry, raised $15M in a Series A led by Blue Lion Global and Renegade Partners, the company tells Axios exclusively.
Why it matters: The company aims to allow banks and lenders to access real-time customer data with a less-invasive process.
How it works: San Francisco-based Rightfoot's product — called Connect Magic — can verify a user's identity and ownership of accounts at other banks and lenders.
- Connect Magic lets consumers give banks, lenders and fintechs permission to access their data using customer data financial service providers already have on file — such as name, date of birth and address.
- Then with the consent of the consumer, "we're essentially then acting on behalf of that customer and they're authorizing us to go to the financial institution and retrieve [their] data," Rightfoot CEO Danielle Pensack says.
Context: Having real-time access to data at other banks and lenders gives financial service providers a more up-to-date and holistic view of a consumer's financial health.
- That, in turn, enables them to monitor accounts, mitigate fraud and chargebacks, and offer more personalized financial products to customers.
- "For a lender, that means that I can have a better chance of collecting if I'm actually using a data-driven approach," Pensack says.
The intrigue: Rightfoot's product competes directly with companies like Plaid and Yodlee, which require consumers to enter account information to create a data bridge between financial institutions.
- That approach has become industry standard, but it also creates friction for consumers and financial institutions alike.
Between the lines: Pensack and co-founder Deirdre Clute started the company as a way to help consumers manage and repay their student debt.
- But after surveying more than 150 financial institutions, they found their banks and lenders faced an average 40% dropoff rate every time they required a customer to share their username or password.
- "Your username and password at a bank is very confidential, and people aren't comfortable sharing that all the time," Pensack says.
- So they set out to create a different way to enable access to those data that "didn't require such an invasive process," she says.
Of note: The financing round includes participation from Bain Capital Ventures, Box Group and Kraken Ventures.