“Digital transformation” and AI remain very popular terms in the world of enterprise software, and today a Romanian startup that has built a platform that leverages both concepts, And sees user traction in the financial industry, raised a decent round of funding. FlowX.ai – which allows companies to transfer old and newer software into one place to build and run apps and services based on them – has raised $35 million, a Series A that it will use to continue to develop its product and expand its business internationally.
Dawn Capital led the round with PortfoLion, SeedBlink and DayOne Capital – which previously backed the company in a $9 million seed round – also participating.
Today, FlowX.ai mainly works with companies in the financial sector – among its clients are BNP Paribas, OTP, Banca Transilvania and Alpha Bank – and relies heavily on third parties such as systems integrators (IBM, KPMG, etc.) users. Its strength helps these large incumbents launch new services more quickly that can be used internally or externally to compete with new products that so-called neobanks and other new players are bringing to market. FlowX.ai claims that since its launch four years ago, some 30 million users have interacted with products and services created using its platform.
FlowX.ai does not disclose its valuation, but PitchBook lists some of the startup’s recent financial data. According to these, its revenue for the year ending December 2022 was just $1.55 million, but was up more than 735% from the previous year. We’re due to speak to Ioan Iacob – the CEO who co-founded the company with Radu Cautis and Serban Chiricescu – later and we’ll ask about the numbers and update this post as we learn more.
The problem that FlowX.ai tackles is not new. Companies like MuleSoft, Boomi, Sapho, Tray.io, and Snaplogic, and many others, have been working for years on solutions that make it easier for businesses to bundle and use legacy and newer apps and build services around them faster and easier. .
The fact that the top three on this list have been acquired by Salesforce, Dell and Citrix, respectively, is a strong sign of the scale of the business potential in this space and its value to the biggest tech players in the industry.
This startup’s particular approach to the space is its application of AI, using it specifically to automate some of the onboarding, building apps and services that businesses spend a lot of time and money doing it manually.
This is a particularly interesting problem and solution, given FlowX.ai’s target market, the financial industry.
Many banks and other financial services organizations have been on long “digital transformation” roads for years – some new software has been added to meet more regulatory requirements, some to improve or launch specific new products, and some in response to new startups stealing customers with better services. But the reality is that many of these companies are still working with a combination of tools, including many very old legacy systems. The ongoing challenge for these organizations is how to make old software (and old data) work with new applications and new data, or simply make old software work in a more modern and less siled way.
It’s not only endemic to finance, but it’s often seen as one of the most painful industries when it comes to modernization and what Iacob sees as empty promises.
“Companies have long been promised useful tools to modernize their business. Many promises have been made over the years regarding the speed of digital product development, no code/low code, citizen programmers and many more. But those promises have not been kept,” he said in a statement. “Instead, companies got a thousand disjointed point solutions and found themselves locked into inflexible proprietary solutions, vendors and technologies. FlowX.AI solves this problem. We are proud that our platform has consistently enabled customers to accelerate application modernization in an unprecedented way: what took years before now takes weeks. »
Romania is an interesting country when it comes to starting a business.
It has been known for years for its strong technical talents, but it was only relatively recently that it marked its place on the map of European startup ecosystems. Several years ago, a number of investors struck gold when another startup in the region, UiPath, turned out to be one of the fastest growing and fastest growing enterprise startups. most successful to emerge in years, essentially leading the charge in the emerging robotic process category. automation (it is now publicly traded).
This has led many to take a deeper look at startups outside of the country. For the record, UiPath’s Series A, in 2017, was just over $29 million. The $35 million announced by FlowX.ai today is significant not just for Romania, but for the wider market, where average tower sizes have shrunk significantly in what has been greater pressure on funding. technology over the past year.
The argument here, in part, is that it’s valuable because it will help stimulate more business in another valuable industry, finance. FlowX.ai cites research that estimates that some $2 trillion was spent on digital transformation projects last year, and $2 trillion was also lost to software errors over the same period – the idea being that his tools can both recover part of this investment, but also reduce part of this loss.
“Technological innovation continues to accelerate, but the businesses that underpin our daily lives run on century-old technology. We can use our phones to have AI generate a travel itinerary in seconds, but it takes our banks to deliver new mortgage products,” Evgenia Plotnikova, Dawn’s general partner, said in a statement. “Business leaders want to quickly accelerate the pace of change, and FlowX.AI offers an elegant and intuitive solution. It removes the legacy infrastructure of horse-drawn carriages and ensures that users are only ever exposed to a spaceship experience.Ioan and his team are further proof that technological innovation is booming across Europe, and we are excited to support them as FlowX.AI becomes a true global player.