Today, Anti Money Laundering (AML) controls are key parts of the fintech and banking industry, as regulation requires all financial institutions to verify the identity of their customers and monitor them for suspicious activity. Making the correct risk-based decision is critical for future revenue, fraud, and compliance risk.
While there are dozens of software companies tackling automation of AML, the majority of enterprise spend – almost $30bn annually – remains on human analysts. That’s because humans are able to make more nuanced decisions that lead to higher revenue and lower fraud, and can execute regulatory-required investigations and reports for suspicious behavior.
While this human judgment will never be replaced, it can be super-charged.
Today, the software category to enable compliance analysts is sleepy and dominated by two incumbents, as the value that software used to provide was limited. Large language models change that equation, opening up a new market.
This is where our latest investment – Greenlite – comes in. Greenlite automates the manual workflow of AML analysts by leveraging large language models to execute investigations and write reports. This AI-enhanced approach is designed to replace the monotony of “L1” analysts’ roles, allowing them to focus on their areas of expertise — making risk based decisions.
Greenlite has four clear value propositions for fintechs and banks:
- Reduce Fraud: Scaling manual review processes translate to better fraud detection
- Increase Revenue: Minimizing false negatives and increasing speed to onboard and resolve customer issues has a direct impact on revenue
- Reduce Compliance Risk: Standardized and auditable processes lead to reduced regulatory risk
- Reduce Opex Costs: Automating routine tasks allows for reallocating budget more effectively
Greenlite is founded by Will Lawrence, a former PM for AML at Facebook and Whatsapp, and Alex Jin, a former software engineer and PM at Dropbox. Will and Alex bring the perfect mix of technical and product depth with an insatiable focus on customer needs and go to market.
When I met them during their time in YC, I was drawn to their desire to build AI agents for compliance teams. As outlined in my recent post on Product Led AI, co-pilot for services is one of the key categories where new companies will be built and capture value, enabling companies to go after a whole new market of services spend.
Over time, Greenlite has the potential to supercharge humans to focus on what they do best, and reduce the fraud costs that everyone bears to create a safer and more efficient financial system. We’re excited to be the first backers of Greenlite on that journey.