Today’s regulatory and societal pressures to understand who a business “is” and what that business does are at an all-time high. Last month, as an example, Facebook implemented new verification requirements for businesses purchasing ads.¹ Meanwhile, regulators have fined financial firms at least $28.4 billion for failing to comply with money-laundering and sanctions violations since 2008. Citibank alone now employs over 30,000 people dedicated entirely to banking compliance.²
Yet at the same time, the barrier to creating a business is at an all-time low. In fact, a recent study by Global Integrity Foundation found that in all 50 states, more information is required to get a library card than to establish a business.³
For an increasing number of B2B companies, especially those in credit, lending, banking, and other regulated industries, the challenges of balancing growth, risk, and compliance are harder today than ever before.
As the GDP of the internet continues to grow, and more business relationships become entirely virtual, our role at Middesk is to provide the infrastructure for businesses to develop trusted relationships. The capital we’ve raised accelerates us toward this goal.
Over the last decade, we have seen significant innovation in the way that businesses manage consumer identity and risk (we worked on these at our previous employer, Checkr, prior to starting Middesk); however, companies that provide goods and services to other businesses still rely on operational processes and legacy providers who look the same today as they did before the internet was created.
Middesk is developing a new approach tailored to understanding business identity and risk based on how businesses operate today, not how they did decades ago.
Tackling this challenge from first principles, we believe that telling a company’s story through data requires the following:
- Information should be relevant. There are tens of millions of businesses in the US alone, but each has its own story.
- Information should be recent. Businesses change from one day to the next.
- Information should be complete. One must understand the full picture of a business before making a confident decision.
Looking forward, our vision is to apply these principles to every meaningful detail about every business. Doing so will improve decision-making across compliance, fraud, and underwriting by providing more relevant and complete information in areas of financial stability, legal exposure, and corporate relationships, among others. In this way, we not only aim to reduce risk but expand economic opportunity to businesses who lack traditional measures of credit or financial standing.
While this is a funding announcement, we don’t think the capital is the exciting part. Rather, we’re thrilled to be transitioning from building a product to building a company, from finding our first team members to providing a place for people to work on hard, meaningful problems.
We’re thankful to our investors, our early customers, and our team for helping us get here and begin to look toward our next chapter.
We are always looking for curious, driven individuals who want to help establish trust between businesses. If you’re interested in chatting, reach out to firstname.lastname@example.org.
The Middesk Team