Verafin, a financial crime management company based in St. John’s, Newfoundland and Labrador, has closed a record-setting $515 million CAD in equity and debt recapitalization. This represents the largest-ever venture capital deal in Canadian history.
“Verafin is in the very early innings of its mission to create the world’s most effective crime fighting network.”
The company raised the massive round from Spectrum Equity’s investing fund, as well as Information Venture Partners’ (IVP) new fund. Northleaf Capital Partners, BDC Capital, and Teralys Capital also participated. Senior debt financing was led by Wells Fargo Capital Finance, and included Scotiabank. Verafin said the new funding will allow it to further pursue its growth plan while remaining an independent company.
“We are very excited to begin this new phase of Verafin’s journey,” said Jamie King, CEO of Verafin. “This financing round with our long-term partners Spectrum Equity and IVP allows Verafin to accelerate our investments in product innovation and customer success, and continue our progress in market penetration of larger financial institutions.”
Verafin was founded with a mission to fight financial crime through collaboration and cross-institutional analysis. It offers a cloud-based, secure software platform for fraud detection and management, Bank Secrecy Act and Anti-Money Laundering compliance and management, high-risk customer management, and information sharing.
The company’s software leverages big data, visual storytelling, and collaborative investigation capabilities, aiming to significantly reduce false positive alerts, create context-rich insights, and unify compliance processes faced by financial institutions.
Some of Verafin’s milestones in recent years include 87 percent growth in annual recurring revenue, sitting at $100 million CAD, and a 108 percent growth in sales and bookings between 2017 and 2019. Verafin has also signed 25 financial institutions with over $5 billion USD in assets under management.
“Verafin is in the very early innings of its mission to create the world’s most effective crime fighting network,” said Dave Unsworth, general partner at IVP. “We see a massive opportunity ahead for Verafin to continue to lead this market transformation through continued product innovation and thought leadership.”
Both IVP and Spectrum Equity have previously invested in the company, in 2009 and 2014, respectively. Following the close, Verafin’s co-founders, management, and employees will still collectively represent the largest share-holding group in the company.
“We are thrilled to be renewing our partnership with Verafin via this new investment to support its next phase of growth,” said Chris Mitchell, managing director at Spectrum Equity. “We look forward to working with Jamie and the rest of the Verafin team to continue to support their product-innovation led go-to-market strategy that has enabled the company’s explosive growth.”
Image courtesy Verafin