- Flagright, an AI platform focused on financial crime compliance, has closed a $12.5 million Series A round led by Infinity Ventures, with Sella Bank, Frontline Ventures, and Y Combinator also investing.
- Based in London, the startup works with over 100 banks and fintechs in 35 countries. Flagright says its clients see up to 93% fewer false positives after switching to its platform.
- This funding comes at a time when financial institutions are under pressure from two sides: more transactions and criminals using AI to make their attacks bigger and more advanced.
Before co-founding Flagright, Baran Ozkan was a frustrated customer himself. As director of product for financial crime at a European financial institution regulated in both the UK and EU, he spent 15 months searching for the kind of platform he now offers. He found vendors often overpromised, and even his employer’s attempt to build a solution in-house failed.
“The competency of a financial institution is not building financial crime technology. It’s such a complex, T-shaped domain. That’s why I decided to start the company myself,” Ozkan tells Tech Funding News.
From Y Combinator to tier-one banks
Ozkan teamed up with Madhu Nadig, who had worked at Palantir and AWS, and together they founded Flagright in 2022. Early progress got them into Y Combinator. They started with SME clients, moved up to mid-market fintechs, and recently began signing major banks and large enterprises.
Today, Flagright has over 100 clients in 35 countries, with offices in London, San Francisco, and Singapore, and about 40 employees.
Flagright now calls itself the AI operating system for financial crime compliance. Its platform brings together transaction monitoring, watchlist screening, risk scoring, case management, and governance workflows into a single audit-ready system.
The company’s message is clear: most compliance tools are either outdated legacy systems or disconnected solutions that add complexity. Flagright aims to replace both. For example, when a payment goes through a fintech’s system, Flagright checks in real time for signs of fraud, money laundering, or sanctions risk, and produces an explainable, auditable result for compliance teams and regulators.
Who backed it and why
The $12.5M Series A was led by Infinity Ventures, a San Francisco-based fintech-focused fund whose partners previously led strategic investments and acquisitions at PayPal, including deals involving Plaid, Venmo, and Braintree.
The firm has backed companies including Rainforest, Pagos, Kanmon, and Skipify. Sella Bank joins as a new strategic investor, while Frontline Ventures, a Dublin-headquartered firm with six unicorns in its portfolio, including Vanta and LangChain, and Y Combinator continue to back the company from the seed stage.
Jeremy Jonker, co-founder and managing partner at Infinity Ventures, said more advanced financial institutions are choosing Flagright “for its combination of enterprise readiness, explainable AI, operational flexibility, and product maturity.”
He added that the firm expects Flagright to lead the market within five years. The new funding will help Flagright expand in the US and improve its AI for investigations, alert intelligence, and rule optimisation.
A crowded market with a narrow window
Flagright faces strong competition from established companies such as NICE Actimize, Feedzai, and ComplyAdvantage, which have longer track records and greater resources. Ozkan says Flagright stands out because of its timing and technology. While older companies are adding generative AI to existing systems, Flagright has used it from the start.
“We are the oldest company for generative AI technology in financial crime,” Ozkan notes. This may sound odd for a three-year-old startup, but it highlights how slowly others adopted the technology. Ozkan believes this early start let Flagright solve AI challenges before most competitors.
The market for financial crime compliance is large. It was valued at $26.52 billion in 2025 and could reach $69.52 billion by 2034, growing at 11.4% each year. This growth is driven by stricter regulations, more digital transactions, and smarter AI-powered fraud. US banks are already increasing their compliance tech budgets by 18–22% between 2023 and 2025.
Flagright is entering this market with 40 employees and $12.5 million in new funding. The big question is whether it can move quickly enough to become the standard before bigger competitors catch up.