Identitii gets set to capitalise on a ‘perfect storm’ of tailwinds for its market-leading finance compliance solution
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Special Report: With an expanding client base of blue-chip global banks, Identitii is ready to ramp up its next phase of growth.
Since Identitii (ASX:ID8) first listed in October 2018, the focus has been on building out a market-leading product offering.
The fintech platform’s core product is its Overlay+ system, an integrated solution that allows financial services clients to more easily meet their compliance obligations and engage with customers.
Early product development was underpinned by a partnership with HSBC, which subsequently became a client, and more recently Identitii ran a pilot demonstration with Standard Chartered.
And as it scales up to its next phase of growth, the company is focused on ramping up sales and distribution opportunities across a global client base of multinational banks.
To drive that expansion, Identitii is executing a share placement from a mix of sophisticated and retail investors.
The $3.27m round will be underpinned by a strategic cornerstone investor, and the company is taking applications from retail investors until March 3.
Speaking with Stockhead about the timing of the raise, co-founder and CEO Nick Armstrong said Identitii’s focus on product development perfectly positioned it to capitalise on the macro tailwinds for companies offering compliance solutions to the financial services sector.
“Regulation globally on banks is increasing, and that’s placing a huge strain on legacy technologies,” Armstrong said.
“There’s really only two ways to comply with these rules. One option is to rip-and-replace all of their legacy systems, which is inevitably going to be slow and costly.
“The alternative is to look at overlay services like Identitii, which can be integrated with existing platforms.
“That’s a much quicker and cheaper way of ensuring compliance and so it’s kind of a perfect storm at the moment in the global financial services industry.”
Having already established a track record with existing blue-chip customers, the company is now focused on a strong pipeline of new deals.
In that respect, Armstrong said the additional capital from the share placement will “put us in a good position to deliver some new client wins over the next three to four months”.
The company will drive distribution through both direct sales and partnerships, including an agreement with Symphony Communications – the sector-focused secure messaging platform which serves more than 400 banks globally and last completed a $US460m ($696m) funding round.
“What the partnership means is that our platform integrates with Symphonies’ chat platform, which in turn provides a distribution channel for over 400 customers. So that’s a pretty powerful partnership and it’s going to be a real driver of growth for us,” Armstrong said.
The company is also expecting to build momentum in the domestic marketplace, ahead of the new Open Banking laws that will come into effect later this year.
Identitii was one of 10 companies selected by the ACCC last September to run tests of the new framework.
“That’s pretty major because that will effectively give us a first-mover advantage in the market when this legislation kicks in,” Armstrong said.
“The ACCC has given the banks until July this year to be compliant. and we expect it to be a major driver of uptake of tech solutions such as Overlay+.”