In 2015, we invested in Carta (FKA eShares) and wrote, “Anyone who owns shares or options in a private company instinctively knows that cap table management remains frustratingly analog…The collection and management of this information is a thankless task but critical to our business.”
The same can be said for financial identity verification. Today, individuals and entities must complete investor onboarding repeatedly at financial institutions. These institutions are required to regularly collect and validate dozens of data points in order to remain compliant with a complex web of laws and regulations. The process is slow and repetitive on all sides; it’s aggravating if you’re a private investor.
Parallel Markets, our newest investment, believes that the future of identity verification for financial services should be digital and portable. The “passport model” is one that has long interested us in keeping with our thesis around identity, network effects and user control.
Parallel’s software enables institutions to streamline the investor onboarding process for both individuals and entities, including verified accreditation for 506(c) offerings and KYC/AML. By doing so, Parallel reduces friction for individuals, entities, institutions, and issuers.
Today, Parallel’s customers range from small to midsize financial institutions, startups bringing investors access to new categories such as farmland, and emerging DeFi projects.
The Parallel team is also excited about the opportunity to further double down in web3 and to link wallets to an identity solution. Compliant, portable identity is an ideal use case and currently an important missing infrastructure piece for the emerging wave of DeFi projects. Parallel’s team is working on this opportunity with expertise across financial services, compliance, crypto, and tech. We are excited to back Tony, Nick, Brian and Suzanne in the next phase of their journey with Parallel.