Venture

New bank, who dis? Lifestyle-focused neobank Cogni pivots to web3

Comment

Digital concept illustration representing cryptocurrency exchanges
Image Credits: Sarote Pruksachat/Moment (opens in a new window) / Getty Images

Digital banking startup Cogni is joining the ranks of companies hopping on the crypto bandwagon. The mobile-based platform, founded in 2018 out of Barclays’ accelerator program (which is operated by Techstars), launched with the intent to offer personalized banking products suited to the lifestyles of those in the 18-to-35 crowd, CEO and founder Archie Ravishankar told TechCrunch.

Now, Cogni has raised a $23 million funding round led by Hanwha Asset Management and CaplinFO with a new mandate — bringing web2 and web3 services together on one platform, Ravishankar said. Solana Ventures, FTX Ventures, Ship Capital, Thirty Five Ventures, ROK Capital, Bluewatch Ventures and Alsara Investment Group also participated in the fundraise.

The company last raised a $1.7 million seed round in November 2018 before it officially launched, and subsequently raised a $5 million seed extension round last year, according to Ravishankar.

“When we first started, crypto was not part of our agenda, because we really wanted to build a financial platform that suited people’s lifestyles. When crypto and blockchain became people’s lifestyle in 2021, that’s when we decided that it’s a lot more attractive to build on web3 than web2,” Ravishankar said.

Cogni founder and CEO Archie Ravishankar
Cogni founder and CEO Archie Ravishankar. Image Credits: Cogni

The company currently offers core banking services such as deposit accounts for free to its customers through a borrowed bank charter, like many other neobanks, including Chime. It also offers two lifestyle-oriented products — discounted digital gift cards to popular brands such as Adidas and Sephora that it sources through an aggregator and a feature that calculates a person’s carbon emissions based on their transactions. Ravishankar said the company serves “tens of thousands” of customers in the United States, though he declined to share a specific figure.

The first crypto-related product it plans to launch is a multi-chain wallet, which Ravishankar estimates will be released in approximately two to three months’ time. The Cogni platform will also offer its users access to an exchange to trade their cryptocurrency through a partnership; Ravishankar said it has narrowed down the contenders for this offering to two major exchanges, but did not share which ones it is considering.

He noted that the company has not yet decided if the wallet will be non-custodial, meaning users would hold and be able to access their own cryptocurrencies to transact directly. For reference, major crypto exchanges such as Coinbase offer both types of wallets, though the Coinbase default product is a custodial wallet wherein users can trade crypto based on its price movements but cannot directly access the currency they own.

After launching the wallet, Cogni plans to offer DeFi savings accounts on the Solana blockchain with the goal of offering higher yields than traditional savings accounts, a typical feature of DeFi products in their current state. While the company hasn’t officially chosen a partner for this product, it is considering working with its DeFi-focused strategic investor Ship Capital, according to Ravishankar.

In Ravishankar’s view, Cogni’s pivot to web3 still fits within the company’s original goal to build a bank that aims to capture discretionary spend by young consumers. Cogni will use its basic banking services as an onboarding platform for customers and then build more “social and lifestyle services” related to crypto and web3 in the long-term, he noted.

Both the neobank market and the field of web3-focused banking services are highly competitive. Cogni’s pivot to web3 is likely a bid to stand out among the ranks of digital bank competitors each offering its own interface and set of niche products tailored to specific demographics, while ultimately performing the same core functions as traditional banks.

Crypto-focused neobank Cogni's user interface
Lifestyle-focused neobank Cogni’s mobile interface. Image Credits: Cogni

On the crypto side, there are plenty of independent providers of DeFi savings accounts, standalone crypto exchanges and custodial and non-custodial wallets on the market today. Ravishankar believes Cogni will be able to stand out by offering all of the above on one platform that also offers traditional banking services. He also pointed to Cogni’s user-friendly interface and focus on customer service as potential advantages in this crowded field.

Most Americans “are looking for a plug-and-play solution from the existing system into web3,” Ravishankar said. “They don’t want to download multiple applications or get to know the jargon,” he continued, explaining that a simple, easy-to-use solution is likely to be more desirable for users.

Cogni has 24 employees in New York and San Francisco, with another eight across Europe, according to Ravishankar. The company had ~18 employees when it raised its seed round in 2018 and then downsized during the pandemic before growing again to its current size, Ravishankar said. It is focused on making new hires with a background in web3, both on the product and engineering teams, and is also beefing up its compliance team to gear up for the new product launches, he added.

More TechCrunch

Companies are always looking for an edge, and searching for ways to encourage their employees to innovate. One way to do that is by running an internal hackathon around a…

Why companies are turning to internal hackathons

Featured Article

I’m rooting for Melinda French Gates to fix tech’s broken ‘brilliant jerk’ culture

Women in tech still face a shocking level of mistreatment at work. Melinda French Gates is one of the few working to change that.

6 hours ago
I’m rooting for Melinda French Gates to fix tech’s  broken ‘brilliant jerk’ culture

Blue Origin has successfully completed its NS-25 mission, resuming crewed flights for the first time in nearly two years. The mission brought six tourist crew members to the edge of…

Blue Origin successfully launches its first crewed mission since 2022

Creative Artists Agency (CAA), one of the top entertainment and sports talent agencies, is hoping to be at the forefront of AI protection services for celebrities in Hollywood. With many…

Hollywood agency CAA aims to help stars manage their own AI likenesses

Expedia says Rathi Murthy and Sreenivas Rachamadugu, respectively its CTO and senior vice president of core services product & engineering, are no longer employed at the travel booking company. In…

Expedia says two execs dismissed after ‘violation of company policy’

Welcome back to TechCrunch’s Week in Review. This week had two major events from OpenAI and Google. OpenAI’s spring update event saw the reveal of its new model, GPT-4o, which…

OpenAI and Google lay out their competing AI visions

When Jeffrey Wang posted to X asking if anyone wanted to go in on an order of fancy-but-affordable office nap pods, he didn’t expect the post to go viral.

With AI startups booming, nap pods and Silicon Valley hustle culture are back

OpenAI’s Superalignment team, responsible for developing ways to govern and steer “superintelligent” AI systems, was promised 20% of the company’s compute resources, according to a person from that team. But…

OpenAI created a team to control ‘superintelligent’ AI — then let it wither, source says

A new crop of early-stage startups — along with some recent VC investments — illustrates a niche emerging in the autonomous vehicle technology sector. Unlike the companies bringing robotaxis to…

VCs and the military are fueling self-driving startups that don’t need roads

When the founders of Sagetap, Sahil Khanna and Kevin Hughes, started working at early-stage enterprise software startups, they were surprised to find that the companies they worked at were trying…

Deal Dive: Sagetap looks to bring enterprise software sales into the 21st century

Keeping up with an industry as fast-moving as AI is a tall order. So until an AI can do it for you, here’s a handy roundup of recent stories in the world…

This Week in AI: OpenAI moves away from safety

After Apple loosened its App Store guidelines to permit game emulators, the retro game emulator Delta — an app 10 years in the making — hit the top of the…

Adobe comes after indie game emulator Delta for copying its logo

Meta is once again taking on its competitors by developing a feature that borrows concepts from others — in this case, BeReal and Snapchat. The company is developing a feature…

Meta’s latest experiment borrows from BeReal’s and Snapchat’s core ideas

Welcome to Startups Weekly! We’ve been drowning in AI news this week, with Google’s I/O setting the pace. And Elon Musk rages against the machine.

Startups Weekly: It’s the dawning of the age of AI — plus,  Musk is raging against the machine

IndieBio’s Bay Area incubator is about to debut its 15th cohort of biotech startups. We took special note of a few, which were making some major, bordering on ludicrous, claims…

IndieBio’s SF incubator lineup is making some wild biotech promises

YouTube TV has announced that its multiview feature for watching four streams at once is now available on Android phones and tablets. The Android launch comes two months after YouTube…

YouTube TV’s ‘multiview’ feature is now available on Android phones and tablets

Featured Article

Two Santa Cruz students uncover security bug that could let millions do their laundry for free

CSC ServiceWorks provides laundry machines to thousands of residential homes and universities, but the company ignored requests to fix a security bug.

2 days ago
Two Santa Cruz students uncover security bug that could let millions do their laundry for free

TechCrunch Disrupt 2024 is just around the corner, and the buzz is palpable. But what if we told you there’s a chance for you to not just attend, but also…

Harness the TechCrunch Effect: Host a Side Event at Disrupt 2024

Decks are all about telling a compelling story and Goodcarbon does a good job on that front. But there’s important information missing too.

Pitch Deck Teardown: Goodcarbon’s $5.5M seed deck

Slack is making it difficult for its customers if they want the company to stop using its data for model training.

Slack under attack over sneaky AI training policy

A Texas-based company that provides health insurance and benefit plans disclosed a data breach affecting almost 2.5 million people, some of whom had their Social Security number stolen. WebTPA said…

Healthcare company WebTPA discloses breach affecting 2.5 million people

Featured Article

Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Microsoft won’t be facing antitrust scrutiny in the U.K. over its recent investment into French AI startup Mistral AI.

2 days ago
Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Ember has partnered with HSBC in the U.K. so that the bank’s business customers can access Ember’s services from their online accounts.

Embedded finance is still trendy as accounting automation startup Ember partners with HSBC UK

Kudos uses AI to figure out consumer spending habits so it can then provide more personalized financial advice, like maximizing rewards and utilizing credit effectively.

Kudos lands $10M for an AI smart wallet that picks the best credit card for purchases

The EU’s warning comes after Microsoft failed to respond to a legally binding request for information that focused on its generative AI tools.

EU warns Microsoft it could be fined billions over missing GenAI risk info

The prospects for troubled banking-as-a-service startup Synapse have gone from bad to worse this week after a United States Trustee filed an emergency motion on Wednesday.  The trustee is asking…

A US Trustee wants troubled fintech Synapse to be liquidated via Chapter 7 bankruptcy, cites ‘gross mismanagement’

U.K.-based Seraphim Space is spinning up its 13th accelerator program, with nine participating companies working on a range of tech from propulsion to in-space manufacturing and space situational awareness. The…

Seraphim’s latest space accelerator welcomes nine companies

OpenAI has reached a deal with Reddit to use the social news site’s data for training AI models. In a blog post on OpenAI’s press relations site, the company said…

OpenAI inks deal to train AI on Reddit data

X users will now be able to discover posts from new Communities that are trending directly from an Explore tab within the section.

X pushes more users to Communities

For Mark Zuckerberg’s 40th birthday, his wife got him a photoshoot. Zuckerberg gives the camera a sly smile as he sits amid a carefully crafted re-creation of his childhood bedroom.…

Mark Zuckerberg’s makeover: Midlife crisis or carefully crafted rebrand?