How ModernFi's $18.7M Series A Shapes the Future of Deposit Management for Smaller Banks

Community and regional banks face an unprecedented challenge in today’s financial landscape. With deposit volatility at historic highs and large institutions dominating customer acquisition, smaller banks struggle to compete for deposits and customer retention. This environment has created urgent demand for modern solutions that can help these institutions thrive despite mounting pressures from elevated interest rates and evolving customer behavior.

ModernFi has emerged as a critical player addressing this market gap. The fintech company specializes in deposit network infrastructure that enables banks of all sizes to grow, retain, and manage their deposit base through advanced technological solutions. Rather than relying on legacy manual processes, ModernFi’s platform operates on a modern tech stack designed specifically for the modern banking environment.

Funding Round Signals Strong Market Validation

The company’s latest achievement underscores growing investor confidence in its approach. ModernFi secured $18.7 million in Series A funding, led by Canapi Ventures with participation from prestigious backers including Andreessen Horowitz, Remarkable Ventures, Huntington National Bank, First Horizon, and Regions. Combined with its earlier $4.5 million seed round, the company has now raised over $23 million in total funding.

This capital injection enables ModernFi to accelerate its platform expansion and deepen its integration within the banking ecosystem. The timing proves particularly strategic—existing deposit networks still rely on cumbersome manual workflows that create friction for both banks and depositors. ModernFi’s API-first, cloud-native architecture directly addresses these operational bottlenecks.

The Problem ModernFi Solves

Banks face multiple deposit management challenges simultaneously. Interest rate increases have fundamentally altered deposit behavior and stability. Digital banking capabilities and real-time payment systems have accelerated the speed of fund movements. Regulatory scrutiny around liquidity and funding has intensified. Traditional deposit networks lack the technological sophistication to handle these dynamics efficiently.

ModernFi’s deposit network operates through three core mechanisms: sweep functionality that automates fund movements, deposit sourcing capabilities that expand available funding pools, and reciprocal deposit arrangements with extended insurance protection. The platform streamlines onboarding and operational workflows, making participation accessible to banks that previously found network products too complex or burdensome.

Market Significance and Competitive Positioning

Since inception in 2022, ModernFi has positioned itself as the only truly tech-enabled deposit network in the United States. Founded by Paolo Bertolotti and Adam DeVita—both Columbia University alumni with deep backgrounds in deposit and cash management—the company combines engineering expertise with banking domain knowledge.

Bertolotti brings academic rigor from his MIT PhD, while DeVita contributed product management experience from his tenure at Citi. This combination of technical capability and financial services acumen informed the platform’s architecture from inception.

The competitive advantage lies in ModernFi’s fundamental design philosophy. While competitors maintain legacy infrastructure requiring significant manual intervention, ModernFi’s modern technology stack eliminates operational burden and reduces adoption friction. This architectural superiority translates directly into faster onboarding, simplified operations, and expanded utility for network participants.

Investor Perspectives on Banking’s Future

The funding round’s composition reveals strategic conviction across the investment landscape. Canapi Ventures, specializing in fintech companies within its extensive bank network, views ModernFi as addressing a critical industry need at precisely the right moment. Andreessen Horowitz, which led the seed round, reaffirmed confidence in the company’s trajectory despite unprecedented deposit volatility and recent banking sector stress.

Bank investors—Huntington National Bank, First Horizon, and Regions—participate directly because ModernFi’s capabilities offer tangible competitive advantages. These institutions recognize deposit management as a priority that demands technological innovation. The platform expands digital capabilities for wealth management clients and provides operational differentiation in an increasingly commoditized market.

Looking Forward

ModernFi’s mission centers on modernizing how financial institutions of all sizes operate and serve their communities. The company addresses a genuine gap in the banking infrastructure—one that became increasingly critical as deposit dynamics shifted dramatically in recent years. With substantial capital now secured and institutional validation from major banking players, ModernFi is positioned to scale its deposit network significantly throughout American banking.