Sedric AI, a startup that develops a dedicated compliance large language model for financial services, said Thursday it has raised $18.5 million in an early-stageA funding round led by Foundation Capital.
The company’s Series A funding round was also joined by new investor Amex Ventures and existing investors including StageOne Ventures and The Garage. Including $3.5 million raised in a seed funding round in 2021 led by StageOne, the company has raised a total of $22 million.
Founded in 2020, Sedric’s platform allows financial technology companies to comply with dynamic and changing regulatory requirements. According to the company, as more fintech companies expand their customer base and operational regions and financial services grow, more organizations have begun to embrace generative artificial intelligence. The technology comes with its own risks, as well.
Sedric’s solutions include an AI reviewer capable of analyzing customer interactions to examine customer interactions to manage compliance risk, a summarizer to speed up closure time after work calls, an AI coach that can assign and track action items and a compliance tracker for partners. Service agents can also take advantage of a compliance copilot that can guide them on calls in real-time with checklists, prompts and script templates to help them optimize their tasks.
The company said it spent time refining its models based on the industry’s best practices to build a compliance-dedicated LLM with an enterprise-ready platform to help manage compliance risks. The models are customized to an organization’s unique needs and automate policy enforcement, work to detect anomalies, mitigate deviations and assist with audits.
“For financial institutions, compliance and growth can be seen as two competing priorities,” said co-founder and Chief Executive Nir Laznik. “With our compliance LLM, we turn risk into a growth opportunity.”
According to a Lexus Nexus report, the worldwide cost of compliance borne primarily by financial institutions is around $206.1 billion, representing more than 12% of the money spent on research and development. The same report noted that though certain industries are still looking into how to use AI and machine learning, 72% of finance professionals are already using AI to enhance compliance procedures.
Sedric said its customers include a growing base within the United States and Europe, including global lenders, banks, trading platforms and insurance outfits. Without providing numbers, Sedric added that over the past 12 months, the company’s revenue has increased fivefold off a undisclosed base, showing a notable rise in demand for its services.
With this new funding, Sedric said it plans to focus on growing its AI lab in Tel Aviv and expanding marketing teams to reach more customers.