What the business is
An operating system and marketplace for banks that lets them host originated loans, let other banks participate in them and see each other's assets
The bet
Banks will trade loans, deposits and portfolio visibility on a shared marketplace to diversify risk instead of each holding only its own local assets
Starting capital
$6 million raised, led by Fin Capital, closed shortly after founding in March 2023 and before the Silicon Valley Bank failure
How it started
Michal Cieplinski, who co-founded Fundbox and had been chief business officer at Pipe, moved to senior advisor at Pipe at the end of February 2023 and started CapStack in March with Tzvika Perelmuter. His observation was that banks are islands with no connectivity between them, even though they all search for ways to diversify capital sources.
What happened
He says the company raised its money almost immediately and right before the SVB meltdown, pre-revenue and pre-product. Fin Capital, also Pipe's lead investor, led the round, with Alloy Labs, Cambrian Ventures, Cowboy Ventures, Future Perfect Ventures, Gaingels, Selah Ventures, Uncorrelated Ventures and Valor Equity Partners. Fin Capital founder Logan Allin joined the board.
What has to be true
Small and mid-sized banks are limited by geography and have only deposits to fund loans
Large banks hold huge deposits but cannot originate loans without local relationships
The SVB failure showed the cost of concentrated assets, which banks on the platform also faced
What can be applied
A two-sided network can be pre-sold: Cieplinski took signed-up banks to investors before writing code, so the commitments, not a product, carried the round.
Aftermath
As of July 2023 CapStack had not launched; the founder planned beta testing with design partners in Q4 2023 or Q1 2024. His claim of 60+ interested banks was self-reported.
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