Paris-based regtech startup Dotfile, founded in 2021, is making waves in the world of financial compliance by raising €6 million in its latest funding round. This follows an earlier round of €2.5 million, bringing the company’s total funding to over €8 million. The new round, led by Seaya Ventures, also saw participation from previous investors Serena and Hexa. Dotfile’s goal is to simplify and modernize the often complex and expensive world of compliance by using AI to automate processes for financial institutions.
Dotfile’s platform, often described as a one-stop-shop for compliance, focuses on automating the process of customer onboarding and ensuring companies meet Anti-Money Laundering (AML) regulations. The platform specializes in business verification, known as Know-Your-Business (KYB), which has traditionally been a time-consuming and costly manual process. Dotfile has changed the game by integrating data from dozens of sources to generate a comprehensive business verification report in just 10 seconds, making it a leader in the KYB space.
Compliance is a growing concern for financial institutions, fintech, and crypto companies, with more regulatory scrutiny being placed on these industries. This is where Dotfile steps in, providing an efficient solution for verifying businesses and ensuring they comply with global regulations. “More than $200 billion is invested in compliance annually, yet 2% of the global GDP is still tied up in money laundering, fueling crime. AI has the potential to revolutionize these processes and have a massive positive impact on society,” said Dotfile’s CEO, Vasco Alexandre.
Dotfile’s rapid growth has attracted more than 50 customers across 10 countries, including major players in the financial services industry like Spendesk, Younited Credit, Flowdesk, and Keyrock. These clients rely on Dotfile’s AI-driven technology to streamline their compliance processes, helping them navigate the increasingly stringent regulations placed on financial and fintech companies.
The recent €6 million investment will be crucial in fueling Dotfile’s R&D and supporting its international expansion efforts. The company recently opened a new office in London, a key financial hub, and plans to continue expanding into other important markets. As financial institutions face increasing competition from fintech firms and struggle with outdated compliance systems, Dotfile’s AI-powered approach offers a much-needed solution to modernize their operations. Alexandre notes, “Compliance costs banks up to 10% of their revenue, with one out of four employees working in compliance roles. Existing systems are outdated, and AI represents the tipping point for this much-needed transition.”
The use of generative AI in the compliance sector is transforming how financial institutions handle regulatory requirements. By automating tasks that once required significant manpower and resources, Dotfile enables companies to focus more on growth and customer service, rather than getting bogged down in compliance paperwork.
Aristotelis Xenofontos, Partner at Seaya Ventures, emphasized the importance of Dotfile’s innovation: “We have been watching the Know-Your-Customer (KYC) and KYB space for over a decade, and we believe AI is the key to transforming these processes. After evaluating more than 20 products, we found Dotfile to be the first truly innovative AI solution, with a deep understanding of the compliance space and an ability to execute at the highest level.”
Dotfile’s success highlights the growing trend of regtech companies utilizing AI to solve longstanding inefficiencies in the financial industry. As compliance becomes more complex, companies like Dotfile are poised to play a critical role in helping institutions navigate this ever-evolving landscape, all while making the process faster, more accurate, and less expensive.
With strong backing from investors and a focus on international expansion, Dotfile is set to become a major player in the regtech space, providing cutting-edge solutions for businesses worldwide.
