In his 2023 Annual Shareholder Letter, JPMorgan Chase CEO Jamie Dimon highlighted concerns around proper oversight in the credit markets. Alarmingly, many community banks, credit unions, and private lenders have little insight into the risk exposure of their private credit books as they don’t have ongoing monitoring of those loans. 

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We’re thrilled to announce we are leading a $7.5M seed round in EnFi, an AI-powered risk management decisioning and monitoring platform for the private credit and lending space. EnFi is building a platform for underwriting and portfolio management for lenders, focused on accelerating complex credit analysis and monitoring.

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EnFi is led by successful, repeat founders Joshua Summers and Scott Weller. Joshua previously was the CEO/co-founder of Clypd, a data and advertising tech company for streaming and non-linear television acquired by AT&T in 2019. Scott was previously the CTO/co-founder of SessionM, a customer data and engagement platform, which was acquired by Mastercard in 2019.

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“AI is poised to transform critical workflows associated with financial analysis,” says Lars Albright, General Partner at Unusual Ventures who led the investment. “We believe the opportunities for process automation and improved risk analysis within the underwriting process are substantial and I am thrilled  to partner with proven entrepreneurs, Joshua and Scott, on their path to building a market leader in the category.”

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While the private credit market has grown substantially, reaching $2.1T in assets last year, the IMF's Global Financial Stability Report has noted the escalated risks could intensify if economic stress increases. Additionally, research from Moody’s Analytics found that nearly half of lenders are dissatisfied with their current risk monitoring solutions and 80% of lenders are actively seeking investments to improve their monitoring processes.

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One of the biggest pain points that financial institutions and private lenders face today is having limited insight into the risk of their complex loan book portfolio. Personal loans and commercial loans are easier to underwrite and monitor since they all look relatively similar, but there is no solution in the market today that leverages AI to monitor more complex loan products. With EnFi, credit analysts can monitor many of their workflows around data gathering/assessment, research, reporting, and monitoring.

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EnFi is attacking a substantial market with an urgent need to leverage the emergence of AI to transform their risk intelligence. EnFi’s beachhead customers will be the ~25K private and institutional lenders in the US. Outside of this initial beachhead customer base, EnFi is applicable to other institutions that manage complex loan book portfolios. This includes commercial real estate, family offices, procurement teams, VC funds, and corporate development. Given the risk exposure of these private institutions and their shortage of credit analysts with the necessary skillsets to conduct the needed monitoring of these loans, the demand in the market is significant.  

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EnFi has a macro tailwind behind them regarding the number of open credit analyst jobs that are in the US and the shortage of workers that exist. There are ~76K credit analysts employed in the US, with ~34K openings for these positions currently (across credit/risk analysts and loan officers). These hires are expensive and it’s difficult to find the right candidates with the correct experience in this space. At the same time, when loan origination picks up, portfolio management for these loans suffers as credit analysts are more incentivized to underwrite new lending products versus managing the current loan portfolio that exists.   

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We are excited for EnFi to emerge from stealth and the initial momentum they’re seeing in the market. To learn more about EnFi, please visit www.enfi.ai.