via FinTech Futures
US start-up, Grasshopper Bank, has opened for business, having completed a private placement offering and gained all final regulatory approvals. A key differentiator is intended to be its digital platform. Martin Whybrow reports.
For its technology, the bank opted for Temenos’ T24 Transact core banking system.
Grasshopper Bank will serve innovation economy companies and capital communities in New York and in other major US innovation economy centres. It opened for business on 13 May for a select group of entrepreneurs and venture investors, with a broader rollout of its services planned in the coming months.
Grasshopper Bank CEO, Judith Erwin, says: “Traditional banks, limited by antiquated and burdensome legacy systems, are less equipped to meet the needs of early stage companies. Their business models and infrastructure do not position them to provide products and services for today’s digital entrepreneur at affordable prices, or to take advantage of new technologies around data, security and user-friendly access.”
She adds: “In contrast, Grasshopper Bank will act as a partner with entrepreneurial companies, delivering digitally-driven, streamlined services that give management teams more efficient command of day-to-day financial operations.”
The bank’s CTO and co-founder is Minerva Tantoco, who has held senior positions at UBS, Merrill Lynch, Fannie Mae, and served as the first CTO of the City of New York.
CEO, Erwin, was founding EVP of venture capital services at Square 1 Bank, from its launch in 2005 to its IPO in 2014 and its ultimate sale in 2015 to Pacific Western Bancorp. She has previously worked at Comerica, Imperial Bank, and Plaza Bank of Commerce. Overall, the bank claims its senior management team has over 200 years of experience in commercial banking and financial services.
The Grasshopper private placement raised approximately $116.2 million, which followed an earlier seed round offering that raised $15 million. Combined, this is believed to be the largest capital raise for a start-up bank in the US.