PortX Launched as New Entity by ModusBox and Secures $10M in New Funding for Total Combined $17.5M Series A
- PortX spinoff creates two groundbreaking companies better able to serve their target markets and stakeholders.
- Fuse and BankTech Ventures invest $10M in PortX to accelerate next-gen connections between community financial institutions and fintechs.
- ModusBox focuses on the development and support of inclusive and interoperable international real-time payment network infrastructure.
By David Wexler
SEATTLE, WA – ModusBox’s Board of Directors has approved a plan to separate PortX Inc., our North American-based integration software business for community financial institutions, from our Mojaloop development and support team delivering real-time payment infrastructure and financial inclusion initiatives. Additionally, I’m pleased to announce that PortX has closed a $10M Series A funding round with Fuse and BankTech Ventures to propel company growth and scale product capabilities.
With some luck, we built two companies
In 2013, along with Co-founder and CTO, Kent Brown, I started ModusBox to build a premier services team of integration experts and develop a tool for simplified B2B integration and EDI messaging for the logistics industry. We bootstrapped the company by investing funds from consulting services back into R&D for the software.
During this time, we completed several integration projects for community financial institutions (CFIs) – namely, banks and credit unions. In the process, we learned that the financial services industry was in dire need of modern integration capabilities and that the CFI market demanded a solution tailored to their needs instead of the typical general-purpose integration technologies available. This led us to develop our integration platform, PortX, which proved its flexibility as it easily adapted to solve the typically complex challenges faced by CFIs when integrating disparate applications and digitally connecting to fintech partners.
We pivoted the business and invested in the PortX platform by expanding functionality and building reusable API-centric integrations for financial service technologies. Soon, the PortX platform gained traction in the financial services marketplace as a leading integration and infrastructure technology connecting CFIs and fintechs.
Our expertise in solving application integration challenges in the financial arena also led us to design and develop Mojaloop – the first open source software for interoperability in real-time payment networks. This was a defining achievement for ModusBox as it set us on a trajectory to help solve financial inclusion challenges globally. In the process, we added some of the brightest technologists working on real-time payments solutions to our team and quickly gained a reputation as a payment industry leader.
ModusBox became a member of the Mojaloop community and one of the primary contributors, building and supporting this groundbreaking open source payment network. Elements of the PortX platform enhanced Mojaloop usability by simplifying the onboarding process for CFIs joining a Mojaloop-based payment network.
These parallel developments are what lead us to today’s announcement.
Motivation for spinning off PortX
For several years, ModusBox has operated complementary yet independent sides of its business: Supporting Mojaloop to develop, deploy, and operate an open source real-time payment network (ModusBox) and delivering a world-class iPaaS for the financial services industry (PortX). Inevitably, a corporate reorganization was necessary to maximize the potential for each side of the business and magnify the value they offer their respective customers.
As separate entities, ModusBox and PortX are empowered to:
- Realize additional financial security as a result of a capital structure change;
- Independently pursue strategic objectives with financial targets that more appropriately match the distinct market-fit opportunities;
- Seek capital investment and other partners that pursue similar business objectives;
- Efficiently allocate capital, technology, and team resources in a manner best suited for each company’s strategic goals;
- Execute on key performance indicators that align with improved profitability forecasts;
- Foster unique company cultures, benefits, and career opportunities for team members in harmony with distinct geographic customs and company missions.
Meet PortX’s Series A investors
This funding round is led by FUSE and BankTech Ventures, and they join Patamar Capital, Choice Bank, and American Capital Partners – our investors from the $7.5M Series A round we announced earlier this year – to bring the total combined value of the Series A round to $17.5M.
FUSE is a venture capital firm based in Seattle that launched in 2020 as a spinoff from Ignition Partners – a well-respected firm that invested in Seattle technology startups for 20 years, including the likes of DocuSign and iCertis.
“FUSE invests in Pacific Northwest-based technology businesses with an unmistakable drive for solving the biggest industry challenges that organizations face today,” said Brendan Wales, Founding Partner at FUSE. “PortX fits perfectly into our portfolio because its platform unlocks innovative new solutions, fintech partnerships, and speed to market for community financial institutions struggling to keep pace with big bank competitors with even bigger budgets.”
I’m pleased to have BankTech Ventures join this funding round. The firm participated in ModusBox’s $7.5M Series A round at the end of April and has played an instrumental role in our success this year by introducing PortX to CFIs throughout their network.
“We were thrilled to double down on our investment and partnership with PortX. Just in the last four months, we’ve observed firsthand the benefits that PortX’s seamless integration platform provides to our network of banks,” said Carey Ransom, Managing Director at BankTech Ventures. “We are excited for the increased focus that the new PortX entity will have on the community banking world and working with the team to open new, innovative opportunities and fintech connections for our banks.”
Partnering with Fuse and BankTech Ventures will scale PortX as an industry leader that connects CFIs to the new crop of fintech partners that are revolutionizing the industry.
Independent company focuses with a common mission
The spinoff creates two independent companies focused on solving unique challenges for the variety of customers we serve across distinct sectors of the financial services landscape and better positions each entity to unlock its full market potential.
ModusBox Inc. will operate payment infrastructure for financial inclusion initiatives, particularly throughout Southeast Asia and Africa. The company remains committed to the ongoing design, development, and advocacy of Mojaloop technology and interoperability in Mojaloop-based real-time payment networks.
PortX Inc. will focus on providing best-in-class integration solutions to CFIs and fintechs, including the PortX platform – the Integration-Platform-as-a-Service (IPaaS). The company will strive to grow the technology to support global transformation and API capabilities for CFIs.
Despite the differences between ModusBox and PortX, our companies remain focused on a shared mission to create universal access to reimagined financial services that improve people’s lives.
Here’s to what’s next
Today is the most significant moment in the history of ModusBox and PortX, but it’s also just the beginning.
To the team that made this possible – thank you and congratulations. Few organizations ever realize the level of success we’ve had – let alone the success that both of our businesses have achieved.
To our customers, partners, and investors – without you, we wouldn’t have had the runway to get in the air. Thank you for your business and your support.
I’m excited to see ModusBox continue to succeed with its focus on enabling interoperable, instant payment systems that drive financial inclusion in parts of our world where vulnerable people need it most. And I’m looking forward to accelerating PortX’s advancement as a leading integration and infrastructure company that transforms the business model of CFIs and fintechs.
PortX is a technology company focused on financial services integration software that unlocks access to banking core data, eliminates vendor dependencies, and enables embedded banking-as-a-service solutions. We help financial institutions empower their teams to connect to fintech partners and real-time payment networks like Zelle®, ACH, Fedwire, Mojaloop, and others. Our solutions enable interoperability between internal systems and member services such as online banking, credit checks, mortgage and loan applications, and others, allowing for a timely and accurate view of customer data. For more information, please visit www.portx.io.
ModusBox is a global software company delivering equitable and inclusive financial services by driving participation in real-time payments. It maintains a leading role in the Mojaloop community through contributions to the core solution and development of adjacent capabilities. ModusBox supports government, industry, and commercial organizations with scheme creation, hub business operations, and technical operations for self-hosted or cloud-based Mojaloop real-time clearance solutions. The company provides financial institutions with training and integration through the Payment Manager onboarding and participation tools. Its enterprise support licenses ensure dependable service by covering implementations of core solutions or the participation service used by connected financial institutions. For more information, please visit www.modusbox.com.
FUSE is an early-stage venture capital firm investing in Pacific Northwest-based Seed and Series A companies that are reinventing the modern economy with software. FUSE is committed to supporting the next generation of B2B technology entrepreneurs building category-defining businesses of lasting value. Founding Partners Kellan Carter, Brendan Wales, and Cameron Borumand are joined by Venture Partner and 8-time Pro-Bowler Bobby Wagner, as well as Senior Operating Partners John Connors and Satbir Khanuja. The strategic LP base includes current and former executives at the Pacific Northwest’s top companies, including Microsoft, Amazon, Nike, Starbucks, Costco, T-Mobile, Avalara, DocuSign, Smartsheet, and many more. For more information, please visit www.fuse.vc.
About BankTech Ventures
Established in 2021, BankTech Ventures, LP is the first venture fund created for and by key leaders in community banking, bank technology, and fintech. BTV serves the community banking ecosystem through strategic investments, education, and collaboration with its limited partners and ICBA members by delivering a de-risked and/or fully vetted network of leading and emerging bank technology companies to enhance a community bank’s value, as well as aim for strong returns from the underlying investments in these companies. For more information, please visit www.banktechventures.com.
ModusBox Secures $7.5 Million in Series A Funding to Accelerate Innovation for Community Financial Institutions
Milestone investment led by Patamar Capital will be used to propel the company’s growth, scale product capabilities, and expand fintech partnerships, empowering IT modernization for financial institutions.
SEATTLE, WA – ModusBox, the infrastructure and integration technology company for financial services, today announced the close of a $7.5 million Series A investment. The round is led by Patamar Capital, a social impact fintech venture fund, and co-led by Choice Bank, a leading sponsor bank. BankTech Ventures and American Capital Partners also participated in the round.
ModusBox was founded in 2013 and took on the challenge to improve lives by accelerating universal access to reimagined financial services. The company developed PortX, the Integration-Platform-as-a-Service (iPaaS) for the financial services industry, and collaborated to build a new class of real-time payment networks as one of the founding members of the Mojaloop project. Today, PortX is an industry-leading technology for community financial institutions (CFIs) that unlocks access to banking core data, eliminates vendor dependencies, and creates simplified connectivity for the new wave of fintechs and real-time payment networks that are reshaping the global financial system.
The company will use the new funds to accelerate the development of its PortX products, drive key partnerships with advanced fintech solutions, and continue its contributions to the Mojaloop real-time payments ecosystem. The funds will also scale the company’s recruiting, marketing, customer success, and engineering groups as ModusBox responds to rapidly growing demand.
CFIs leverage PortX to scale their IT infrastructure and organizational capabilities in developed economies to compete with big banks and deliver modern financial services to their customers. In developing countries, millions of people rely daily on microfinance institutions and other small lenders to support their livelihood and thriving economies. These small financial institutions can utilize the suite of ModusBox-supported solutions to simplify connectivity to real-time payment systems and minimize the operational costs and technical challenges of participating in a modern national payments infrastructure.
“At Patamar Capital, we invest in generation-defining companies that unlock better economic opportunities for low-income communities across various industries, including financial services, SME digitization, education, healthcare, and agriculture,” said Geoff Woolley, Co-Founder and Partner of Patamar Capital. “ModusBox is a perfect fit for our portfolio because the PortX platform and Mojaloop support the underlying national-level infrastructure and the participating financial institutions that are connected. This two-pronged approach is vital to unlocking sustainable economic opportunities for individuals and small businesses in emerging economies.”
“Choice Bank is proud to have been a long-time customer and strategic partner of ModusBox,” said Tim Heilman, Chief Innovation Officer of Choice Bank. “We have observed firsthand the evolutionary progression of the PortX platform and were happy to partner with ModusBox as the sponsor bank for its ‘Fedwire-as-a-Service’ solution. Our partnership with ModusBox has allowed us to explore innovation and delivery of banking services in new ways and are excited by the possibilities of what this means for our customers. We are thrilled to join the round and continue partnering with ModusBox in its mission to serve the communities and people who don’t currently have access to banking services.”
“We’re eyewitnesses to the difficulties that community banks experience when trying to innovate and work with fintechs, especially as they have to navigate their core provider challenges and limitations,” said Carey Ransom, Managing Director at BankTech Ventures. “ModusBox is the ideal industry partner to ease integration effort, allow for re-use, and accelerate banks’ opportunities to build and launch new solutions for their customers. As the community bank ecosystem fund, BankTech Ventures believed that world-class integration capabilities was a key investment mandate for us, and we found ModusBox to be the clear leader. We’re excited by the opportunity to work with them, and we’ve already seen tremendous interest and support from our banks.”
“The global financial services industry is in the middle of a massive transformational shift fueled by unprecedented social behavioral changes, red hot consumer demand, and new technologies introduced daily,” said David Wexler, Founder and CEO of ModusBox. “We could not be more excited to partner with Patamar Capital, Choice Bank, BankTech Ventures, and ACP in this round. Our goal is to accelerate digital transformation for our CFI customers, enabling them to embrace the new era of open banking and embedded finance with the fintech partnerships and crypto solutions their customers want. Our investors share in our mission to facilitate financial inclusion and will play an instrumental role in helping us drive worldwide interoperability and participation in national-level real-time payment networks.”
ModusBox is the infrastructure and integration technology company focused on open banking solutions that unlock access to banking core data, eliminate vendor dependencies, and simplify connections to fintechs and real-time payment networks. Our PortX platform is the iPaaS (Integration-Platform-as-a-Service) built for financial services. It helps financial institutions empower their teams to connect to real-time payment networks like Zelle®, Mojaloop, ACH, Fedwire, and others. In addition, our solutions enable interoperability between online banking, credit checks, mortgage and loan applications, and other internal systems allowing for a timely and accurate view of customer data. For more information, please visit www.modusbox.com.
About Patamar Capital
Patamar Capital (“Patamar”) is a leading impact venture capital firm investing in early-stage technology companies to transform the lives of the emerging middle class. Patamar works with entrepreneurs to build sector-defining business models, drive economic impact, and generate top-tier financial returns. Patamar is founders’ trusted thought partner throughout their growth journey by fueling ambition, weathering tough times, and expanding across geographies. Patamar is currently investing out of Patamar Fund II and manages its Proof-of-Concept portfolio, Patamar Fund I, and the Investing in Women fund. Through these four funds, the management team has invested in more than 30 companies, many of which have grown quickly, scaled to reach large populations, and had financial success. For more information, please visit www.patamar.com.
About Choice Bank
Choice is more than just a bank. As a People First organization, we provide a wide array of innovative financial solutions to make banking and managing finances easily accessible from anywhere. Our People First approach led us to become a leading fintech sponsor bank delivering flexible and accessible online banking services, globally. We partner with fintechs that share Choice’s passion for serving our communities and those who do not have ready access to banking services. Established in 2001, Choice now exceeds $3 billion in assets and has been recognized as one of the fastest-growing banks in America. For more information, please visit www.bankwithchoice.com.
ModusBox’s Vice President and General Manager of ModusBox EMEA joined the esteemed panel for this discussion at Innovate Finance’s Global Summit kicking off London’s FinTech week.
FinTech continues to fuel the unbundling and rebundling of financial services – and it will likely do so for some time. However, different customer segments will gravitate toward solutions with different levels of data sharing and autonomy. How much will the future of finance depend on the ability for products, services and systems to coordinate and work together?
Megan O’Donnell, vice president of financial inclusion, spoke at the Innovate Finance Global Summit (IFGS) in London in April. The panel discussion also featured Warren Carew of ModusBox —which helps organizations make the most of the Mojaloop platform, and Juliet Kiluwa from Financial Sector Deepening Trust, a partner in the recent effort to update the national scheme for cross-platform instant payments in Tanzania. The discussion was moderated by Kosta Peric, deputy director of the financial services for the poor program at the Gates Foundation.
MADISON, Wis.—Worldwide Foundation for Credit Unions, the social impact affiliate of the World Council of Credit Unions (WOCCU) dedicated to financial inclusion, has launched a project to design interoperable, open-loop, low-cost, real-time payment platforms for its global network of credit unions across Asia, exploring the use of the Mojaloop open-source platform.
Unlocking mobile money interoperability and merchant payments across Africa through Mowali – Orange Group and MTN Group – two of Africa’s largest mobile operators and mobile money providers – have today announced a joint venture, Mowali, to enable interoperable payments across the African continent. The GSMA is proud to support its development.