California-based fintech startup Coris has announced $3.7 million in seed funding to enhance its AI-powered risk management platform. The company aims to transform outdated processes used by financial services firms to evaluate risk for small and medium-sized business (SMB) customers.
The seed round was co-led by Lux Capital, a prominent enterprise AI investor, and fintech specialist Exponent Capital, with additional support from Y Combinator, Blank Ventures, and several veteran fintech founders.
Coris harnesses large language models (LLMs) to analyze unstructured data, facilitating tasks such as automated underwriting. Its latest product, CorShield, combats impersonation fraud during SMB onboarding by verifying applicant data against various online sources.
“There’s a clear need for integrated risk infrastructure software with embedded AI for SMBs,” said Coris CEO Vinodh Poyyapakkam in an exclusive interview. “Companies want to manage risk natively within their platforms.”
Advanced Risk Insights and Fraud Prevention
The recently announced capital will accelerate the rollout of Coris’s innovative products, including CorShield and a comprehensive business verification solution. These tools aim to revolutionize the labor-intensive processes of SMB risk assessment.
The challenge is significant: the SMB sector comprises over 400 million companies, yet risk analysis is often hindered by fragmented and unstructured data. Coris addresses this by using large language models to synthesize data, providing a detailed understanding of potential risks without the delays and inaccuracies associated with manual processes.
Coris’s AI-driven platform not only saves time but also reimagines risk management, presenting a suite of tools that facilitate onboarding and continuous monitoring. For example, CorShield reduces fraud by cross-referencing SMB data with multiple sources to verify identities during signup.
In addition to fraud prevention, Coris’s MerchantProfiler enables real-time business verifications and industry classification, utilizing GPT-4 to deliver up-to-date data across 46 countries. This capability is essential for software companies and fintechs seeking global outreach, as precise classification is vital for compliance and risk management.
Finally, Fuzio, Coris’s centralized risk management platform, allows teams to automate routine risk assessments, configure custom rules, and take action based on comprehensive data.
A Major Advance in SMB Risk Management
Coris has already verified over 150,000 SMBs, amassing data on over 330 million worldwide. Clients such as Mindbody have reported a fivefold increase in SMB onboarding speed and a 50% reduction in operational costs, alongside an 80% decrease in manual processes.
The total addressable market is substantial, with roughly 30 million SMBs in the U.S. alone. The surge in startup formation post-COVID and the rise of embedded finance have amplified the demand for automated, low-touch underwriting, while traditional players have been slow to adopt emerging technologies like natural language processing.
“There is so much unstructured data online, but millions of data points are not being standardized, cleaned, and leveraged appropriately,” noted Grace Isford, partner at Lux Capital. “Coris has a strong technical team that can manage this data at scale.”
With a team of seasoned risk and fraud experts from PayPal, eBay, and other fintech pioneers, Coris is poised to build on its early success. The founders envision an integrated risk infrastructure software platform powered by AI.
As Coris scales, its expanding SMB dataset will enhance the effectiveness of its machine learning algorithms in capturing this multi-billion-dollar market. The future looks promising for this innovative fintech leveraging AI and alternative data to mitigate SMB risk.
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