FinTech's AI Agent Authentication Problem

I wrote this piece in early 2024. At the time, there was not as much conversation about AI Agents as there is now, but it was very clear that agents will have a major impact on daily life and work.

A disclaimer: I am not an expert on AI nor do I claim to be; some (or many) of the thoughts in this piece have become commonplace.

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AI Agent Authentication Problem

Note: Platform and Website are used interchangeably. This refers to websites, products, stores that exist on the web. Really any website. 

AI agents are already enhancing or entirely replacing jobs in the business world. In the future, it’s likely AI agents will play a major role in individuals’ personal lives. Figure recently shared that it’s ‘launching its robots in the home;’ Tesla’s Elon Musk has repeatedly shared his vision for a future where every home has its own Tesla Robot, executing tasks on behalf of the homeowner. Whether it’s picking up groceries and swiping a credit card, or taking your dog to the groomer, AI agents and robots will transform the lives of all humans and the physical streets of the world.

What’s (maybe) less spoken about is how AI agents will transform web traffic. Sooner rather than later, every individual will have an AI assistant that completes personal tasks for them on the web. Booking a flight and planning a trip itinerary, building a budget spreadsheet, making loan payments, or reserving a table at your favorite restaurant will likely all be done by an agent that you direct through a single app or interface. In this future, it’s not unreasonable to believe that practically all web traffic and actions taken on the web will come from bots and agents, not humans. By “all,” I mean 99.99%; bots are already the majority of web traffic, so this isn’t too crazy.

Before this can become a scalable reality, there are some real challenges and questions that need to be addressed:

1. How will platforms know whether the agent interacting with their site on behalf of someone is truly representing that individual or using stolen information? Remember, hackers and bad actors will have equal access to AI agents as everyone else and the problem of identity theft/account takeovers aren’t going anywhere anytime soon. 

2. How will platforms know whether the action being taken by an agent is legitimate? I assume it’s on the builder of the agent to ensure its agent only takes actions approved by its owner, but how will platforms or websites know this for sure? 

3. If an AI agent is instructed to complete an action on a website but it needs to create an account to do so, what is the legality around the agent agreeing to terms of use on behalf of its owner? If an AI agent e-signs something, can the owner of the agent be held to those terms even though they didn’t e-sign it themselves? If the owner must agree to terms or e-sign something themselves, then it’s highly unlikely AI agents will be able to roam the web freely and execute actions on behalf of their owners due to friction. 

4. If an AI agent tries to buy something with a credit card or bank account, how does the payment platform know whether that payment was truly authorized? If the AI agent’s owner disputes the charge, can the payment platform even fight back? 

5. Should AI agents be able to access every platform or product if it knows its owner’s passwords? Should there be a way to restrict access through an app like a password manager or SSO tool does for employees of businesses today? In this case, the AI agent would be an ‘employee’ of its owner and the consumer could grant the agent access to certain platforms via an app.

6. Will the companies that build AI agents be subject to regulation that requires them to work with an authentication service to ensure that unrelated companies can confirm their agents are acting on behalf of their owner?

Many of these questions are applicable to both physical AI agents/robots and those that exist solely on the web. Without an answer to these foundational questions and concerns, I’m unsure whether it will be possible for AI agents to roam the web or physical world due to authorization concerns; the security risks are too great. It’s possible that the onus to ensure agents are only acting with authorization falls on the maker of the agent and everyone will be comfortable with that, but I believe it’s more likely there will need to be some kind of authorization layer/blockchain/or protocol that enables the public and private businesses to instantly validate the actions of agents and who or what they really represent.

The solution here is likely a mixture of a public protocol that enables anyone and any business to validate the actions of an agent have been authorized by their owner and that the agent is truly representing who they say they are, and software that enables websites and physical commerce locations to instantly validate AI agents before they are permitted to take action. The software would also have to be really good at identifying AI in the first place; human traffic should not be affected or subject to unnecessary friction like it is today with captchas, etc. This solution is also likely accompanied by a consumer platform that enables individuals to grant/restrict their agent’s access to certain locations and platforms so that data is not constantly being shared with the agent’s maker. There is also likely a push notification system built into the consumer application that enables websites/stores/etc. to request secondary authentication that the consumer’s agent is acting on their authority. 

Building this solution would be no small feat, if it were done by a startup. It’d be expensive and likely take a number of years before it is widely adopted. There are some very difficult technical challenges as well. That said, the owner of this protocol will likely own the connective tissue between AI and how it interacts with the physical/digital world on behalf of real humans. It’s most probable that large, established search titans will be the ones building this protocol (i.e. Google, Microsoft, Yahoo, etc.).

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Anyway, if anyone is building anything related to this topic, I’d love to chat. My email is reedeswitzer@gmail.com.

How this Gen Z fintech CEO turned dyslexia into a problem-solving ‘superpower’

Full article written by Shalene Gupta at Fast Company and is available here.

As a child, Reed Switzer developed a passion for building things while he watched his father create interior designs. He struggled with dyslexia and attended a school for people with learning-based disabilities. Today, the biracial 22-year-old has turned his passion for building into a career as an entrepreneur. He dropped out of Wharton his sophomore year to found Hopscotch, a payment platform for small businesses and freelancers.

Switzer got his start in the business world as a freshman in high school, when he founded a clothing company with friends. He was particularly struck by how inefficient the payment systems were for vendors.

At the age of sixteen, he met Tony Abrahams, the creator of a music streaming startup. Originally, Switzer was part of a focus group that brainstormed with the company executives once a month. However, he impressed executives so much that he was brought on as operations lead, where he got a front-row seat in all aspects of business.

When he came up with the idea for Hopscotch in college, he decided to drop out and focus on building it. Today, Hopscotch has raised nearly $10 million in venture funding.

Switzer appears ageless—as if he could be anywhere between the ages of 20 and 35. In part, this is because he projects an air of unflappable calm and confidence, the kind of person you want around in a crisis. He sat down with Fast Company to talk about life as a young entrepreneur. 

What was it like being an operations lead in high school and interacting with executives who were much more experienced?

It was extremely intimidating. But when you take a step back and think about what the company is actually trying to build, there’s probably no one better suited than me in that group to provide perspective on what this platform should look like. Gen Z is in a unique position where we’ve literally grown up in this age of digital transformation, and it comes naturally to us. Once I was able to really internalize that, it made the conversation a lot easier.

Speaking of being a young entrepreneur, what in your education was helpful? And what were the gaps?

So, I’m going to answer this in two pieces: early schooling and then later. I am dyslexic. I went to this specialized school for students with language-based disabilities. And one of the things that they taught us early on was dyslexia gives you this unique point of view, this unique way of thinking and approaching problems that, you know, can be viewed, frankly, as a sort of superpower. And so they gave us all of these really great tools on how to think about the world.

And then when I went on to high school, they taught us a bunch of really generally applicable things like public speaking and history, math, science—but they didn’t cover business. How do you think about cash flow? How do you think about, you know, building a budget for your business or [filing taxes]? I had to look elsewhere for that, and found it when I was working at the music streaming startup. 

If we want to see more young founders, what should we be thinking about changing in the education system?

Everyone is different. I wouldn’t say everyone should leave school to focus on building something they’re passionate about. There are a ton of valuable lessons you’ll learn in school, and especially in college, about networking, and building relationships that’s just important in the natural development of someone. But for myself, I’ve just always found more value in building something and getting that real-world experience, so it was a really easy decision to leave school and focus on building Hopscotch. And I think given what we’ve done thus far it’s put me years past where I would have been in school. But again, that’s just me, and my personal experience in dealing with dyslexia.

What’s something you’d like to get better at?

I’m always pushing myself on, “How do you build better cultures?” One of the things younger founders experience is managing people that are two or three times their age. You’re having conversations with these people that have a lot more experience than you do. So, how do you bring all of these super-sharp people from different backgrounds into a room and build something that’s your vision, and do so in a way that’s fun, and everyone feels passionate and like they have a hand in building that company? 

The easiest way to learn about this is just having conversations with founders across different spaces and learn about the things that didn’t work out well for them early on, and the things that they would advise you to do. Early on, I always reverted to looking it up on Google or listening to a podcast. But I don’t think there’s a replacement for having conversations with real people that have really built these things. I would advise everyone to master the art of cold outreach. Shoot someone you admire an email, and get them on the phone and chat about their experiences.

What other advice do you have for people who want to be founders?

One, I will reiterate the art of cold email, because when we were fundraising early on, it took us about eight months to bring in our first seed capital. That was a long, arduous process. I didn’t have any introductions to start. I had a process where I used CrunchBase to find investors, and then shot them an email or DM, and then if they listed a phone number, gave them a call. The first piece of advice is, like, you have to be extremely scrappy. Entrepreneurship is glorified in modern films and TV shows, but it’s not easy, so take pride in the journey and try to enjoy it. 

And number two is don’t be afraid of doubling down on your vision and your ideas. I think it goes hand in hand with managing folks that [are] maybe double your age. It’s easy to be swayed by those that have a lot of experience, because you think that experience leads to just knowing what the right direction is, but that’s not always the case. So make sure you come to the table with your own perspective and ideas.

How do you balance staying true to your vision with managing people with more experience? When do you know it’s time to pay attention to your vision versus when they have a good point?

I’m still figuring it out! What’s helped me a lot in is being a good listener, being able to disassociate from yourself and put yourself in that other person’s shoes. I like to just completely forget what my vision or thinking is and step into that person’s shoes and view the situation or the idea objectively. If you can really do that well, then everything else becomes so much easier. You understand how your team members might be feeling and where they are coming from. The short answer is: Don’t have an ego. You may not always be right. Viewing things from a different perspective will help you find the best answer.

How does being a founder of color impact you?

I feel that there’s a lot more pressure on us to deliver. When we deliver, it says something for the group that I’m representing. The unfortunate reality is you have to push so much harder to make things happen. But one of the things that I’ve tried to do is not think about it too much. There are barriers I’ve faced and will continue to face . . . but the way I look at it is just makes what we do as founders of color look more impressive, and that much more powerful in the long run. And so I don’t think about it too much. I like to just keep pushing and hopefully [I’ll] be able to look back in 10 years from now and be like, we went through all of that and proved everyone wrong.

Finally, how much do you focus on your age?

I actually try not to talk about my age. I’ve been told by some folks that I should publicize my age a bit more, but I am hesitant to, because I feel like age doesn’t really matter. You shouldn’t get more press because you are younger. You shouldn’t get less press because you’re older. Your results sort of speak for themselves. . . . Sometimes there are investors or corporate partners who may try to take advantage of you if they know you’re younger because they assume you’re naive. I like to try to keep an air of mystery.

Hopscotch is officially open for business

Full announcement available here. Written by Bret Lawrence.

For the past year, our team has been working to bring instant, fee-free payments to the small business community. This first-of-its-kind financial tool can help small businesses earn more while making them less vulnerable to long processing times. 

Here’s why we decided it was time to build Hopscotch:

01. The odds are stacked against small businesses—but they don’t have to be. 

Great payment tools designed for small businesses are few and far between. Underserved by banks and overlooked by legacy payment platforms, small businesses have unique financial needs and challenges that require custom-built solutions. 

That is why we are making it possible to pay and get paid in real-time with zero fees. The result? Small businesses can keep more of the money they earn without having to bite the bullet on bogus transaction fees or lose precious days to processing times.

On top of that, Hopscotch is designed to look and feel like a consumer app because we believe that supporting the next generation of small businesses begins with intuitive design. We offer easy-to-use interfaces with insanely useful feature sets so that the flow of money between businesses can mirror the seamless flow of money between individuals. Auto-generate invoices, send reminders, schedule payments, and integrate with QuickBooks to manage day-to-day accounts payable and receivable. When you cut down on admin tasks like this, you have more time to operate your business.

Beyond instant, fee-free payments, we know that small businesses also need more financial flexibility. (Poor cash flow is the #1 reason that small businesses fail!) So we’re also planning to roll out more features that will help businesses avoid gaps in cash flow and make better in-the-moment decisions for their growth.

02. The small business community is the future. 

We believe that people who start their own businesses are the bravest of the bunch, the cream of the crop. Because for them, it’s personal. 

It takes real courage to be your own boss. To see the tides flowing in one direction and wonder if you could turn them. To start with some notes on the back of a paper napkin and spin them into a bonafide business plan. To develop that daydream into a day job. Our economy is stronger when more independent, innovative, creative daredevils throw their hats in the ring. 

The pandemic shifted priorities for nearly everyone. We all rethought how work fits into everyday life, which sparked a search for more meaning, balance, and independence for many people. According to the Census Bureau, more than 4.4 million new businesses were created in the U.S. in 2020. That’s the highest total on record ever! Today we have a growing community of entrepreneurs, freelancers, small business owners, and startup founders with one thing in common: they want to make more than a paycheck; they want to make a living. 

Hopscotch is here to help them do just that. Let’s connect, transact, and grow together. Ready to create an account? Sign up today!

Hopscotch raises $3.6m to transform the B2B payments experience.

Press release available here. Picked up by more than one-hundred publications.

Small business expectations are changing, and seamless payments are table stakes. Decision-makers want and deserve rapid payments, simplicity, and greater connectivity.

At Hopscotch, we believe the flow of money between businesses should mirror the seamless flow of money between individuals. As former small business owners ourselves, we’re all too familiar with the intricacies of getting paid and making payments to service providers. Existing tools come with unnecessary complexities: feature overload, limited connectivity between users, lengthy waits to receive funds, and often transaction fees.

“Business owners, especially this new generation, want and deserve to pay and get paid with as little friction as possible. Today, there’s a big disconnect: people expect the same speed and ease they experience in their personal transactions to extend to their business ones.”

— Peter Boyce II, Founder of Stellation Capital

Hopscotch’s stored value accounts and consumer-like business profiles enable us to create an unmatched payments experience. But our vision extends beyond a payments platform. We’re building a destination for small businesses to connect, transact, and grow together. A simple, easy-to-use interface. A community of businesses thriving. Together. As one.

Today, we’re thrilled to announce that we raised $3.6 million in support of our vision.

While many small businesses struggled to survive in 2020, record numbers were launched. The U.S. Census Bureau reported that business applications were up 43.3% over the same period in 2019. The full scope of multidisciplinary skills needed to keep a business running can’t be overlooked: this surge of entrepreneurialism needs support. It’s our mission to provide this support, and we’re starting by providing instant, fee-free transactions to small businesses.

We have big plans, and we’re proud to be supported by an exceptional group of investors. Our Seed round was led by Simeon Iheagwam of NOEMIS Ventures and Peter Boyce II of Stellation Capital. Other participants in the round include Valar Ventures, 3KVC, Valor Equity Partners, Red & Blue Ventures, NfX, Switch VC, The MBA Fund, and Brightlane Ventures.

To our growing community of Hopscotchers, welcome! We’re thrilled to have you along for the journey and can’t wait for you all to experience the future of B2B payments. In the meantime, we’re opening a couple of hundred spots for businesses that want to get advanced access to the platform and help us test early features. For details, please sign up for our waitlist here, and check your email.

Learn more about what we’re building via our full press release here.

Questions? Feel free to drop us a line at hello@gohopscotch.com.

9 Essential Business Tasks That Take an Hour or Less

I sat down with Rosalie Murphy @ Nerdwallet to discuss 9 business hacks to improve efficiency. Full article was written by Rosalie Murphy and is available here.

It’s easy to feel overscheduled as a small-business owner. Your inbox is likely overflowing, your to-do list is a mile long and every task seems essential.

With so much on your plate, you might put off some things that don’t immediately contribute to your business’s day-to-day success. But some of those things are critical for the long-term health of your business — meaning you’ll have to do them at some point.

In a matter of minutes, you can take the following nine actions to formalize your business, shore up your cybersecurity and maintain good relationships with customers and staff.

1. Apply for an Employer Identification Number

An Employer Identification Number is like a Social Security number for your business. The IRS requires EINs for some businesses, including those with employees and those filing taxes as corporations. You may also need one to open a business bank account or apply for a business loan.

You can apply for an EIN on the IRS’s website in a matter of minutes, as long as you know your business’s legal structure and provide your address and Social Security number or Individual Taxpayer Identification Number.

If you want more formal structure and additional protection for your personal finances, consider forming a business entity like an LLC or a corporation — though that will likely take longer than an hour.

For Jason Emery — head of U.S. partnerships at online insurance marketplace Simply Business — turning his consulting business into an LLC provided “that level of protection where I can go about my life not fearing that screwing up in any way is going to then put me in a position where my assets are at risk.”

2. Apply for a business bank account

A business bank account is a key tool in separating your business income and expenses from your personal ones. You can open a business checking account online by providing basic information about your business — such as your EIN — and about yourself, like your driver’s license.

3. Move to a password manager

Using secure passwords is one of the easiest ways to protect your business against cyberattacks.

“Using the same short password on multiple websites is a bad idea,” Thomas Muth, director of consulting banking solutions at digital consulting company SoftServe, said through email. “If one site gets hacked, it can be used to log in to your account somewhere else.”

The easiest way to create and store unique passwords is by using a password wallet like LastPass or 1Password. These services let you store all of your passwords behind another password. Once you have an account, you can use your browser or password wallet to generate a new random password for every new account, then save it in your wallet — you don’t even have to write them down.

4. Get business insurance

Getting a quote and buying a policy from an online business insurance provider can take as little as 10 minutes. Not only does insurance protect your business finances after accidents or disasters, but it’s also required by many leases, contracts and vendor agreements.

Getting business insurance “is something that you need to do in order to really enable your business to grow, let alone to protect it,” Emery says.

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5. Plug into local resources

A quick online search should tell you if your region has a Small Business Development Center or SCORE chapter — both programs funded by the U.S. Small Business Administration offer free business coaching — or a business incubator.

If you find one, sign up for its newsletter or follow it on social media. Getting connected to local resources now will give you a place to turn when you need advice and keep you up to date on networking events, grant funding opportunities and more.

6. Survey your clients

Gathering data about your customers’ preferences doesn’t have to be a heavy lift. Free tools like Google Forms and SurveyMonkey make it easy to create an email survey in minutes.

“The low-tech version of [gathering customer data] is, just send out a survey to your clients,” says Reed Switzer, founder and CEO of payments platform Hopscotch. “Some of our vendors have done that with us … and we end up getting a better experience.”

7. Back up your data

If a cyberattack reaches your files that are stored in the cloud, it can be difficult to recover them. Regularly saving a copy of business-critical data to an external drive can help protect you.

“As soon as your local environment is compromised, this could also affect your cloud data,” Muth said. An offline backup “will allow you to recover much faster in case your files get attacked.”

8. Install a grammar plug-in

Switzer uses Grammarly, a browser extension that points out grammatical errors and complicated sentences, to make sure his emails are clear and easy to read.

“Communication with your team and with your clients is probably the most important thing for any small-business owner,” Switzer says. “All of that really builds trust on both sides.”

9. Skim your bank statement regularly

It’s easy to miss a price increase on something like your payments software or internet bill. Reviewing your bank statement regularly can help you notice and respond to those changes.

“Make sure that you have a really good idea of where you're spending [and] where you can cut costs,” Switzer says. “If there are any sort of ancillary fees, like transaction fees, seek out services that don’t have fees.”

While you’re at it, if you use accounting software, make sure it’s pulling in all your transactions and categorizing them correctly. The sooner you spot an error, the easier it can be to put it right.

Overdraft fees: fueling the rise of Fintech

Published article available here.

With rising inflation rates, supply chain issues, and record labor shortages, small businesses in 2022 will be hyper-sensitive to their lifeblood: cash. More specifically, how they protect their money.

Big banks have incentivized themselves to extract wealth from their customers, with overdraft fees being a major source of revenue that generates billions of dollars annually. Additionally, the typical bank charges a $1 to $30 fee for initiating and receiving ACH and Wire transfers or using an out-of-network ATM machine. Until recently, SMBs have widely accepted these fees as a ‘cost of doing business,’ but, over time, they represent tens of thousands in lost dollars.

Enter the Neobank. These FinTechs offer better perks and better user experiences than traditional institutions; they’re also often entirely free for small businesses to join and leverage for daily activities.

With more banking options than ever, small businesses will be faced with a difficult decision: stick with the trusted, old-guard or make the jump to something new. It’s this dilemma that will likely see Neobanks continuing their meteoric rise in the financial industry.

The next ten years of banking: Neobanks vs. Incumbents.

Published article available here.

With more banking options than ever, small businesses will be faced with a difficult decision: stick with the trusted, old-guard or make the jump to something new. It’s this dilemma that will see Neobanks continuing their meteoric rise in the financial services industry.

Today, readily available APIs make it easier than ever to integrate core banking features into any app experience. Service providers from Unit to Solid enable young startups to build complex banking platforms in minutes and launch in weeks. This reduced barrier to entry coupled with a cash-flush market has led to an overwhelming flood of digital banks.

With so many available options, we’re seeing digital banks rapidly diverge into segment-specific solutions. From digital banks built for the elderly to Nerve, the online bank for musicians, Neobanks are relying on ultra-specific audiences to gain market share. We’ve heard the term Minimum Viable Product (“MVP”), but rising Neobanks are now champions of the Minimum Viable Audience (“MVA”).

Traditionally, consumers and small businesses pick a bank and stick with the institution for an extended period – often never switching to a competitor. However, simply offering banking services is no longer enough to retain customers. Digital-native individuals want more from the financial institutions they entrust with their money. Whether through community, commerce, or brand identity, Neobanks are unlocking new, more effective ways to connect with their customers than traditional institutions.

What does this mean for the next ten years of banking? Before jumping into the future of banking, it’s important to touch on a key pillar of this future: identity verification. The biggest pain point of opening a new bank account is proving your identity. We’re all familiar with the hours-long appointment, only to be told that your application is pending, and your account won’t be fully functional for another week. Yes, Neobanks have found innovative ways to reduce this friction by leveraging third-party identification software like Trulioo’s GlobalGateway. However, the account creation process is still where most would-be users drop off.

Exciting startups like Portabl (portabl.io) seek to address this pain point by enabling cross-device, cross-site identity verification. Incumbents like Plaid are also chasing the opportunity. This means multi-step identity verification processes may be a thing of the past. At the very least, proving your identity will not be as significant a friction point as today.

Ok, now let’s talk about the next ten years of banking. In a world with segment-specific Neobanks and significantly less friction in opening accounts at these banks, consumers and small businesses will use several banks throughout their financial lives. Yes, several.

As a kid, you use a youth-focused banking platform like Till. In your late teens, you fall in love with music and start uploading your work to Spotify. You move to Nerve, the digital bank for musicians. Five years later, you start a career as a freelance designer and begin using Novo, business banking. Your business quickly grows, and you need a platform to support your growth. Boom, you seamlessly move to Rho, a digital bank built for high-performing businesses. Years later, you switch to a platform built for setting mid-life professionals up for retirement. And so on.

This future is one where traditional financial institutions can’t compete as consumer-facing brands and platforms. They’re too big and old to be as nimble and customizable as their digital counterparts. If they can’t compete as consumer-facing platforms, then are big banks a thing of the past? Nope. Traditional financial institutions will be infrastructure-first businesses. This is a trend that has enabled tech-forward banks like Evolve Bank & Trust, Cross River Bank, and others to quickly and cost-effectively increase their total assets (deposits). Chime, for example, is a multi-billion dollar Neobank with over thirteen million users that The Bancorp Bank and Stride Bank power. This paid partnership enables Chime to offer banking to its users, increasing deposits at The Bancorp Bank and Stride Bank.

It’s highly unlikely that large financial institutions will be content with serving as shadowy infrastructure-first businesses while the Fintechs they power get all of the attention. Many larger banks will try to cultivate portfolios of various segment-specific neobanks to keep customers within their ecosystem.

There’s a lot to love about Neobanks. From no account minimums to more intuitive user interfaces, the buzzy Fintechs have found a way to make managing finances more accessible and...fun. The divergence of the space will continue for years to come, but it will culminate with the convergence of Neobanks via acquisitions and portfolios managed by traditional institutions.

Hopscotch launches private beta alongside $10m in Seed funding.

Coverage of announcement: FinSMES, Fintech Finance & News, Alleywatch, PYMNTS, Zephyrnet, and a dozen others.

Hopscotch, a community-oriented B2B payments platform that facilitates instant, fee-free payments for small businesses and startups, today announced the launch of its private beta in tandem with a $6.1M seed extension, bringing the company’s total funding to $9.95M. The round was led by Shine Capital and Stellation Capital with participation from additional investors, including ​​NOEMIS Ventures, 3KVC, Valar Ventures, and Red & Blue Ventures.

Hopscotch is a purpose-led brand that helps businesses process their accounts payable and receivable without charging them fees. The platform enables its users to transact with their clients and vendors, even if their clients and vendors don’t have a Hopscotch account. For Hopscotch users, when their client issues a payment, the funds are instantly transferred and accessible, a distinction from traditional payment methods with standard processing periods of 2-8 days. The entire process is also completely fee-free.

“At Hopscotch, we believe businesses shouldn’t have to wait or pay to access money they’ve already earned,” said Reed Switzer, CEO and Co-Founder of Hopscotch. “Most small businesses operate on tight margins, and each day they have to wait to access funds affects their ability to operate. Hopscotch enables businesses to take back their time and money, which, for too long, has been wrongly held captive by legacy institutions and incumbent platforms.”

Today, too many business payment platforms are ubiquitous with complexity and inefficiency: feature overload, limited connectivity between users, lengthy waits to receive funds, and high transaction fees. The result is a B2B payment ecosystem that hinders growth and prevents businesses from being adaptable in highly competitive markets.

Layer in a global pandemic, remote work, and the rise of tech-native Millennials and Gen-Zers in the workforce, and you have a category-defining opportunity to rewrite the way businesses transact. A new generation of workforce talent has grown accustomed to instant payment transfers in their personal lives, and now they want those same fee-free, fast services for their businesses.

Fee-free B2B payments is just one part of the Hopscotch vision. Hopscotch's stored value accounts and consumer-like business profiles also creates an unmatched payments experience. Small businesses such as branding agencies or consultants can leverage Hopscotch to seamlessly manage their accounts payable and receivable. The platform integrates with their existing accounting systems, such as Quickbooks, so that every action on Hopscotch is automatically reconciled.

“New business formation in the U.S. has exploded over the past two years, with the vast majority of those new businesses being formed as sole proprietorships. More and more folks are choosing to work for themselves, and they need software and billing tools that make their lives easier,” said Mo Koyfman, Founder & General Partner of Shine Capital. “Hopscotch is a simple and elegant solution for small businesses to easily invoice their customers, pay their vendors, and smooth their cash flows. With Hopscotch, business owners can finally focus on doing their business rather than managing it.”

With the launch of its private beta, Hopscotch has opened its virtual doors to waitlist customers. Beginning in Q2, businesses that have been invoiced or paid by existing Hopscotch users can join by registering with the email their vendor or client used.

Hopscotch has grown quickly since the assembly of its founding team in August 2021. The seed extension will enable Hopscotch to double the team across all departments, expedite the launch of revenue-generating features, and continue to scale their growing community of Hopscotchers.

For more information on Hopscotch, please visit gohopscotch.com.