Dublin-based fintech Layer is embarking on a new round of funding to help it expand into Europe and North America, and double its worldwide staff.
The firm’s technology can effectively help you set up your own bank or upgrade existing banks’ IT systems.
“These typical digital transformations that these banks signed up for, they are three to five-year exercises, it’s not something that you do overnight. And they involve a lot of risk and a lot of them ended up with failures,” said Layer CEO and founder Roy Zakka.
According to a 2019 report by consulting firm Accenture, the majority of banks globally have yet to see any financial boost from their digital transformation. That’s certainly true of Bank of Ireland, which took an impairment charge last year on its over-budget new software.
Layer offers to effectively plug in to a bank’s existing IT infrastructure and get new products online within six months.
“You’re up and running and you can compete with the likes of Revolut very easily,” Mr Zakka explains. “You can come to our platform and you can actually build a Revolut by connecting to the different bits and pieces.”
It can save banks millions because rather than trying to fix old technology, Layer simply “sits” on top of it and removes any duplicate systems. The bank is then effectively run from Layer’s platform.
But it’s not about turning physical banks entirely digital, according to Mr Zakka.
“The advantage of legacy banks is they are going to keep some branches open, but it’s going to be more like an Apple store experience: you go in, but it’s not to transact or deposit money, it will be more for advice.”
A self-confessed “serial entrepreneur”, Mr Zakka set up Layer after becoming frustrated with his online banking experience. But the timing wasn’t ideal.
“When we launched Layer, it was the middle of financial meltdown. The markets were kind of all over the place. It was crazy out there and none of the banks wanted to be first,” he said.
When he first talked to companies in Europe about mobile banking, they thought he was “coming from another planet”.
“It was just weird for them. Why would anybody want to use their mobile phone to do banking when they have their computer? But the world has changed since.”
Layer currently employs more than 70 people and serves 25 million users in more than 20 countries.
In the past eight months the firm has doubled its staff, and with this new funding round it expects to double in numbers again.
The company is looking to raise €5-10m to hire up to 100 people to expand into Europe and “right after that go for a much bigger round to tackle the North American market”.
Layer is now in active talks with several banks in Europe and North America, as well as global consulting firms and one payment network.
Mr Zakka would like to expand into Ireland, if possible.
“We’d love to be part of the solution and to help. It would be a shame that we don’t have our solution running locally. We’ve managed to secure meetings with all the major players and we’re going to play it by ear,” he said.