Passwordless Authentication Startup Stytch Raises $30 Million
Passwordless authentication startup Stytch this week announced that it has raised $30 million in a Series A funding round. To date, the company raised $36.3 million.
The founding round was led by Thrive Capital. Coatue Management and existing investors Benchmark and Index Ventures participated as well.
Founded in 2020, the San Francisco, California-based company seeks to improve both security and user experience by enabling authentication without the need of passwords.
Stytch is looking to address weaknesses in the traditional password-focused approach, such as the reuse of passwords across accounts, by simplifying the sign-in process and helping developers integrate passwordless authentication into their applications.
Stytch is building APIs and SDKs that companies can use to remove passwords from their applications and improve user onboarding and retention. The new approach, the company claims, also results in improved security.
Over the past year, Stytch has attracted more than 350 organizations as customers, including some Fortune 500 companies. This week, the firm launched out of beta.
The newly acquired funds, the company says, will help it deliver more authentication options, as well as launch additional user infrastructure features to support a low-friction onboarding process. It also plans to invest in creating solutions for session management and advanced fraud detection. By the end of the year, Stytch expects to hire 20 additional team members.
“Passwords are no longer a secure tool. They make companies an easy target for hackers and expose them to account takeover risk. It’s time to step into a new era of authentication, and Julianna and I are proud of the progress the team is making to build a solution that simplifies authentication and makes it more secure,” Reed McGinley-Stempel, CEO of Stytch, said.