Why Canapi is Leading Blend’s $75M Series F Round

August 11, 2020

The events of 2020 have had a profound impact on the way companies interact with their customers. Enterprises are accelerating the shift to digital out of necessity, as commerce has transitioned from in-person to remote.

The financial services industry is no exception. Financial institutions are experiencing triple-digit growth in digital adoption and record-levels of new online account opening. Ongoing conversations with our bank partners have confirmed this narrative.

The way people bank has changed permanently, and digital-first experiences are surpassing the relevance of physical experiences. While digital is not new, this surge of adoption of digital channels has accelerated to a point where financial services leaders are rethinking their strategies altogether.

For decades the banking industry struggled with rationalizing multiple channels:  storefronts, call centers, online and mobile. Single channel became multi-channel.  Multi-channel became omni-channel. Catchy consulting terms were borne out of the need to streamline the customer journey wherever they entered the organization, which ultimately led to channels fighting over spend. Just six months ago, it may have taken years to sort this out. The coronavirus pandemic, combined with the proliferation of fintech, has compressed the timeline into a matter of weeks. It’s clear that the digital channel will dominate from here.

At Canapi, we’re on a mission to find great technology companies, with great leaders, focused on helping banks win. That’s why we are excited to announce our partnership with Blend, the leading platform for digital lending and deposit account opening services.

Our team’s strong relationship with Blend dates back to 2014, when Jeff Reitman initially invested in the company’s Series B round. Over the past six years, our team has admired the company from afar as they’ve become the unequivocal leader in mortgage point-of-sale. Blend has expanded its offering to provide an end-to-end digital mortgage solution, including eClose, and a rich ecosystem of partners supporting the homebuying journey. While we believe there is significant room to run in the homebuying value chain, we are extremely excited about Blend’s expansion into consumer banking and overall platform strategy.

In our calls with Blend customers, there were two recurring themes that resonated with us the most. First, Blend is a world-class product organization. Nima and the Blend management team spend all of their time thinking about customer experience. They constantly iterate until each offering is firmly best-in-class.

Second, Blend is not a software vendor, but rather a strategic partner to banks. Blend has a seat at the table during C-level strategy discussions. As bankers-turned-founders – and now venture investors, we recognize how incredibly hard this is to do. It is a huge testament to the Blend team and their commitment to innovating with a relationship-led approach.

Because of these two points, we’re highly confident that Blend will achieve similar success as the unified digital layer across mortgage, consumer banking and deposit account opening. Early proof points have validated this thesis. With the investment from Canapi, and support from our 37 bank partners, we are committed to helping Blend execute on the mission: enabling financial institutions to provide frictionless customer experiences across all financial products.

While we are still in the early innings of digital transformation in financial services, we have no doubt that Blend will be at the forefront of that change in the years to come. We look forward to joining the Blend team on this journey alongside existing investors including General Atlantic, Temasek, 8VC, Greylock, Emergence Capital, as well as Blend’s growing customer base of more than 250 financial institutions.

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