Codat

# Codat: High-Level Overview

Codat is a financial data aggregation and API platform that enables financial institutions to access, synchronize, and interpret business financial data from their small and medium-sized business (SMB) customers[1][2]. Founded in 2017 and headquartered in London, the company provides a universal API for consented business financial data, powering lending, spend analysis, and accounting automation use cases[2][3].

The platform serves a critical gap in financial services: helping banks, lenders, fintechs, and accountants connect seamlessly to their clients' accounting systems without manual data entry or cumbersome integration processes[1][2]. By automating data access and standardization, Codat enables financial institutions to make faster underwriting decisions, reduce operational friction, and deepen relationships with underserved SMBs[5]. The company is backed by marquee investors including JP Morgan, Tiger Global, PayPal Ventures, Shopify, Plaid, Index Ventures, American Express Ventures, and Canapi Ventures, and serves over 300 global clients[2].

# Origin Story

Codat emerged in 2017 at a moment when financial institutions faced a fundamental challenge: SMBs lacked standardized, digital ways to share financial data, forcing lenders and service providers to rely on manual processes, spreadsheets, and fragmented accounting software integrations[2][3]. The founding team recognized that by building a universal API layer—similar to how Plaid solved payment data aggregation—they could unlock efficiency across the entire financial services ecosystem.

The company's trajectory reflects strong early validation. It has grown to 211 employees across offices in London, New York, San Francisco, and Sydney[3], and recently closed a Series B funding round[3]. The investor roster signals deep confidence: JP Morgan's participation, for instance, demonstrates enterprise adoption and validates the platform's role in modernizing supplier enablement and corporate lending workflows[5].

# Core Differentiators

• Microservice architecture at scale: Codat operates over 100 microservices, each handling authentication, authorization, data fetch, and mapping for external data sources[4]. This modular design enables rapid feature development and horizontal scaling without monolithic bottlenecks.

• Enterprise-grade infrastructure: The platform is hosted entirely on Microsoft Azure with UK-based data storage, leveraging PaaS offerings for automatic patching, high availability, and proactive load monitoring[4]. This enterprise-ready posture differentiates it from lighter-weight competitors.

• Depth of specialization: Rather than being a generic data connector, Codat has built domain expertise in lending, spend analysis, and accounting automation—use cases where data quality and interpretation directly impact financial decisions[1][2].

• Investor-backed credibility: The presence of JP Morgan, PayPal, American Express, and Shopify as both investors and customers creates a virtuous cycle: these firms validate the product while also driving product roadmap alignment with real enterprise needs[2][5].

• Developer experience focus: The platform emphasizes ease of integration and interpretation, allowing financial service companies to reduce time-to-value and operational complexity[3].

# Role in the Broader Tech Landscape

Codat sits at the intersection of three powerful trends: financial inclusion, API-first infrastructure, and SMB digitalization.

The fintech ecosystem has historically focused on consumer payments and personal finance, leaving SMBs underserved in terms of digital financial tools and access to capital[3]. Codat addresses this by becoming the data backbone that enables financial institutions to serve this market more efficiently. As SMBs increasingly adopt cloud-based accounting software (QuickBooks, Xero, etc.), the need for standardized data access becomes acute—Codat fills that gap.

The company also reflects a broader shift toward embedded finance and API-driven banking. Just as Plaid became essential infrastructure for fintech, Codat is positioning itself as the standard for business financial data access. This creates network effects: as more financial institutions adopt Codat, more accounting software providers integrate with it, making the platform more valuable to both sides.

The timing is particularly favorable given rising interest in alternative lending, supply chain finance, and real-time accounting—all of which depend on reliable, consented access to business financial data[1][5].

# Quick Take & Future Outlook

Codat has established itself as a critical infrastructure layer in financial services, with enterprise validation from tier-one investors and customers. The company's challenge ahead is expanding beyond lending and spend analysis into adjacent use cases—embedded accounting, real-time financial insights, and AI-driven business intelligence for SMBs.

The convergence of regulatory pressure (open banking mandates), SMB demand for digital tools, and financial institutions' need to compete for underserved markets suggests Codat's addressable market will only expand. As the company matures, expect deeper integration with accounting software ecosystems, expansion into emerging markets, and potential product evolution toward AI-powered financial advisory for SMBs.

In essence, Codat is betting that business financial data—like consumer payment data before it—will become a foundational utility layer upon which an entire ecosystem of financial services is built.