The company says it will use the funding to “aggressively” build new products for mortgage lending and banking industries, expand its US operations and scale its staff with a focus on machine learning and data science teams.
New investors include Thomvest Ventures and Mubadala Ventures; they join existing backers Oak HC/FT, FinTech Collective, QED Investors, Bullpen Capital, ValueStream Ventures, Laconia, RiverPark Ventures, Stage II Capital and Cross River Bank in round participation. The Series C brings Ocrolus’ valuation over $500 million and its total funding raised to $127 million through six funding rounds.
Founded in 2014 with a focus on automating Medicaid application processes, Ocrolus decided in 2016 to use its technology to classify financial documents. The company utilizes optical character recognition (OCR), machine learning and big data, but also includes a Human-in-the-Loop (HITL) method to provide accuracy regardless of source material.
“Our view from day one was that the marriage of machines and humans throughout our process would allow us to create perfect data, regardless of if the input is a clean bank statement from Chase or a blurry cell phone image from a small community bank,” CEO Sam Bobley told PYMNTS.
The technology provides key data capture, cash flow analysis, fraud detection and is over 99% accurate, attracting lenders who want to automate their underwriting processes, according to TechCrunch.
And the promise to automate document processing with such high accuracy has been successful, with Ocrolus growing its revenue from $1 million in the first quarter of 2018 to $20 million in the second quarter of 2021 through a number of large fintech clients including Brex, Enova, LendingClub, PayPal, Plaid and SoFi.
“Our platform helps lenders automate underwriting and intelligently leverage cash flow and income data for credit scoring. By enabling lenders to more quickly analyze diverse sources of financial data, Ocrolus levels the playing field for every borrower, providing expanded access to credit at a lower cost,” Bobley told TechCrunch.
Now, the company wants to ride the ongoing wave of digital lending technology adoption by shifting its target to banks and traditional financial institutions that are beginning to integrate digital products and services into their existing infrastructure.
“As COVID-19 has forced financial institutions to evolve, every lender and bank has no choice but to offer online options to customers,” Bobley said.
Ocrolus has onboarded over 75 corporate team members in 2021 and plans to hire even faster in 2022. The startup also says it plans to open a data quality control facility in Florida, in order to serve financial and government organizations with onshore data requirements.
“We really are evolving the company from a document analysis company to an infrastructure company, especially for small business,” Bobley told PYMNTS.