Stytch raises $90 Million Series B at 1 Billion valuation
The investment, led by Coatue Management LLC with participation from existing investors Benchmark Capital, Thrive Capital and Index Ventures, comes just four months after Stytch raised a $30 million Series A at a valuation somewhere around $200 million. Since then, the startup has seen an almost 1,000% increase in developers using its passwordless authentication platform, rising from 350 developers in July to about 4,000 in November.
This, the company’s CEO tells us, is because of its API-first approach. “If you think about other passwordless startups, they’re very widget focused,” Reed McGinley-Stempel, CEO of Stytch and former Plaid employee tells TechCrunch. “We’ve had enough experience with non-API-first products that we knew there were a lot of limitations to what you can do.”
“For example, one of the common use cases we’ve seen that we would never have anticipated is checkout flows — adding the ability to create a new account at checkout with an SMS password or email verification, rather than guest checkout,” said McGinley-Stempel.
The company has also launched a number of new products since its Series A raise in July, including support for Sign In with Apple, Google and Microsoft, embeddable magic links and one-time passcodes by email. This week it’s also adding support for WebAuthn, allowing Stytch to support hardware-based authentication keys like Yubico, as well as biometric-based Face ID and fingerprint logins.
Stytch said it plans to further expand its platform over the coming months, too. As part of its Series B raise, it acquired Cotter, a no-code passwordless authentication platform backed by Y Combinator that allows users to add one-tap login to websites and apps. Stytch said it will make it easier for developers to adopt passwordless technologies.
The company will also use the funding to expand its 30-person team and to build out its infrastructure.
Stytch isn’t the only startup that’s on a mission to kill off the password. In June, Transmit Security raised $543 million, in what was believed to be the largest Series A investment in cybersecurity history, for its natively passwordless identity and risk management solution. The following month Magic, a San Francisco-based startup that builds “plug and play” passwordless authentication technology, announced it had raised $27 million in Series A funding.
Stytch seems to be Improving security and user experience with passwordless authentication. I’m sure the company will continue to prosper in its journey ahead. My best wishes to the team of Stytch.Shishir Gupta, Founder and CEO, of StartupLanes.
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