Modern Treasury is one of a growing number of companies (aka unicorns) that embody the great digital transformation that is currently underway in business and society. In just over three years the startup’s valuation has hit $2 billion, achieved through its recent $85 million Series C funding round that brought its total funding to date to $133 million.
As detailed by data and research firm CBInsights, there are over 842 unicorns worldwide, which are private companies having a valuation over $1 billion. CBI’s study showed that 71% of the companies in their most recent review joined the “unicorn club” since 2019. That jump is reflected in the 114 that made the list in 2020 that was followed by a dramatically higher number of 366 through the first three quarters of 2021.
With this recent major milestone passed, co-founders, Dimitri Dadiomov, Matt Marcus and Sam Aarons, are excited as to what is to come—particularly appreciating how far they have gone since working together at LendingHome. They oversaw the payment operations systems there where they observed that there were thousands of underserved clients. This presented them with the opportunity to develop a scalable solution in a new category of payment operations that is now transforming whole business sectors—real estate, healthcare, education and financial services.
As other highly successful startups have done, the team applied to the acclaimed Y Combinator Startup School which they completed in 2018, leading to the launch of their new platform. Once the platform went live the startup had explosive growth as companies readily embraced their payments operations software.
What is amazing is that even though their startup reached a $2 billon valuation in just three years, the co-founders feel they are just at the beginning. Their technology is changing the way money is moved and tracked and as a result it is “reinventing the way businesses are built, run, and scaled”.
They are targeting an annual $750 trillion bank transfer market comprised of wire, ACH and checks. Finance teams are required to track these transfers from initiation to approvals to accounting and reporting—a demanding process that requires a high number of hours conducted over the course of one to three days of clearing.
Modern Treasury’s solution to this time consuming activity is an API for the banking system. They also built software that supports finance and treasury teams to automate the existing multi-step process that is so demanding. The platform now enables companies to “build and scale innovative products, manage payments via dashboard or API, and automatically reconcile cash across multiple bank accounts”.
By the numbers their platform reconciles over $2 billion per month that is a 20x growth year over year. That volume is double what they processed this past March and a dramatic jump from the $100 million per month last fall. This growth reflects the power of digital technology that Modern Treasury is bringing to payment operations similar to what other innovative unicorn companies are bringing to other industries.
The latest funding round led by Altimeter Capital, with participation from existing investors Benchmark and Quiet Capital is timely to support the rapid change underway in the company.
“We’re making big strides with product development and customer traction,” says Dadiomov, Modern Treasury CEO and co-founder. “As we continue to grow, we invite leading banks to partner with us in delivering best-in-class experiences for our mutual clients.”
Other recent changes include the naming of Shruthi Murthy, formerly of WhatsApp, as head of engineering. The company also opened a new office in San Francisco and plans to open one in New York to meet the needs of its fast-growing team.
“Modern Treasury’s remarkable growth is a testament to its unique product and value proposition in the payments ecosystem. Modern Treasury is enabling more and more of the economy to take advantage of modern payment technology,” said Chetan Puttagunta, General Partner at Benchmark and Modern Treasury board member. “They’ve clearly tapped a need in this massive market and we’re thrilled to help support the company’s exceptional growth.”
The startup’s goal of establishing a new category in the payment operations industry was extremely ambitious. But Modern Treasury, now in the elite unicorn club due to its explosive growth shows the transformative power of digital technology that is also seen in the rapid rise of the number of unicorns over the same three year period.
