Andreessen Horowitz has led a $4.5 million seed funding round for ModernFi, a marketplace that allows banks to exchange deposits on demand.
ModernFi operates a deposit marketplace that connects banks with excess deposits to banks that need funding.
This, says the startup, provides an outlet for excess deposits that helps banks manage balance sheet size and earn potential revenue. On the other side, it helps banks source liquidity and fund asset origination.
With a tech stack built on a foundation of compliance and regulatory adherence, ModernFi says it is already working with US-based banks ranging in size from $500 million to $100 billion in assets.
Paolo Bertolotti, CEO, ModernFi, says: "Banks, especially community and regional institutions, are pillars in their local communities, extending credit to folks that want to buy a house or get a car, as well as providing a safe place for people to keep their life savings.
"By allowing banks to source cost-effective funding on demand and manage balance sheet size, ModernFi is fundamentally improving how banks across the country operate."