Squads raises $18M to help businesses ditch bank accounts for stablecoin-native financial operations

Speaker 1: it is funny seeing the the reaction of the dog being like, that thing looks like me. And I feel like there's a little bit of foreshadowing there that when the humanoids start walking around, you're gonna see a lot of videos of people looking at the humanoids with the exact same expression that that golden retriever looked at that robot dog. Anyway, we have our next guest. Stefan Simkin from Squads is in the waiting room. Let's bring him in to the TV event. How are you doing?

Speaker 4: I'm good, guys. How are you doing? We're doing fantastically.

Speaker 1: Welcome to the show. Welcome. Please introduce yourself and company.

Speaker 4: Great to meet you. Excited to excited to be on the show. My name is Stefan, the co founder and CEO at Squads. We're building stablecoin infrastructure and all kinds of products that help businesses manage their stablecoins and financial operations.

Speaker 1: What is the like, what is the key problem that you find most resonates with customers as you tell them? Is it that they haven't even dipped their toe in the stablecoin ecosystem? They know that they can cut costs, reduce fees by jumping in, but it's too much of a hurdle and you can help them or they're already neck deep in stablecoins and they need you to help, you know, help them wade out of the swamp. I'll give you a quick anecdote. Please.

Speaker 2: I don't know if I've told this on the show before but in 2021, I was building a a company called Party Round that was a a fundraising platform.

Speaker 1: I don't think you mentioned that before on the show. Well,

Speaker 2: I'm kidding. Wait a second. So saw Stablecoins getting adoption. I saw a bunch of companies that were starting to raise money with coins because if you had, let's say, international investor, it was much easier to just send staples than than deal with with international wires in certain circumstances. And one of our customers was a crypto company that had a multi billion dollar valuation, hundreds of employees. And when they were onboarding, was like, do you wanna toggle on support for stablecoins? Mhmm. Because I know you're a crypto company. A lot of your investors are relatively crypto native. There's probably some of them that would like to fund their investment with stablecoins. And they said to me, no. We don't wanna do that. It's too difficult to deal with stablecoins. Like, once we have them, we'd prefer to just get dollars. It was a funny moment because of for for for a lot of reasons. But part of it was because infrastructure like what you're building and and talking about today wasn't where wasn't really hadn't progressed very far Yeah. Back in 2021.

Speaker 4: So I think that's we'll we'll get back to the story to the story in a second. To give you kind of a sense of what we what we've done up to up to now, for the first arc of the company, we actually focused on infrastructure. We developed programmable wallets for the Solana ecosystem. Today, secure about 10,000,000,000 in assets. Mhmm. And that was a very crypto native product where we focused on very crypto native problems of those kind of large organizations exploring the digital asset space. And then, through that experience, we actually saw stablecoins start to take this kind of like center stage in the way they run their financial operations. And that's what kind of allowed us to be a little early to stablecoins because we're deeply in it, and we saw real businesses starting to adopt us even though they were kind of early crypto native teams. And I think a lot has happened in the last couple years, where essentially, programmable blockchains are now secure, reliable, resilient, and actually, you know, great to build on. And they, you know, for the most part, solve settlement and that in the normal kind of fintech context, you have to either build in house or Yeah. Rent from someone else. And you have stablecoins that are now much more mature. Right? The stablecoin market cap is way above 300,000,000,000 at this point, and I think that is also building a lot of confidence with, obviously, the the regulators and the broader market. And then I think we generally got better at building crypto products at stablecoin focused products, and today, our thesis with our new product Altitude is really that you don't need a bank account anymore. Right? You essentially can rely on programmable blockchains, stablecoins, and wallets to run your entire financial operations. And one of the major things that actually happened in the last couple years was the big missing piece when we started the company, was this idea of, if I hold a stablecoin in my wallet, how can I reliably pay a third party via ACH or via SEPA? Right? How can I connect to the banking system if I still need to, while obviously, if I want to sell through stablecoins, I can do that instantly, twenty four seven and free? And that was really the the orchestration ecosystem that came in the last couple years to market. Companies like Bridge, that was acquired by Stripe, which essentially stepped into this system and exist in the middle between a company like ours that is providing this product experience and this underlying crypto infrastructure and the banking system and saying, we're gonna take the stablecoins and convert them to fiat wherever you need to or wherever that needs to happen. And there's actually an explosion in that market right now. Right? You have a lot of these local orchestrators. You have kind of the more global ones, the bigger ones. And that was the the missing link for us to say, okay. Now the the the stack is here, and we can actually build financial services in a very different way. And that also was already incredibly exciting to us internally, and then the agentic component came in as well. Right? And we sort of realized that once you have the stack where every layer is naturally programmable, right, from the settlement layer to the account layer to the money itself, obviously, it's a great place to start integrating agents and getting to the world where you have end to end agentic automations, where essentially you, as a customer, as a business, need to do less and less over time.

Speaker 1: Do you use the forward deployed model at all? Like, when you're working with a company, is it high stakes enough that you'll actually go on-site with someone from your team, or do you want to be just fully self serve? Like, is there a trade off in your mind here? How have you thought about it?

Speaker 4: I think today we work with all types of customers. Right? Customers that already have a, like, a majority or some part of their balance sheet in stablecoins, or companies that are, you know, completely new to the space. So that, you know, it really depends on who we're actually trying to onboard. Right? If it's a more creative customer, they usually know what we're doing, and they're they're very comfortable with stablecoins already. Also, the product experience doesn't really impose any crypto knowledge. Right? Like, feels like you're onboarding to, you know, a traditional business account, but a lot of the infrastructure under the hood already powered by is powered by stablecoins, then you can obviously connect to stablecoin rails and make stablecoin payments. So we do forward deployed when it's required. Right? And I would say, today, primarily focus on startups, SMBs, and kind of companies that are, you know, be between sort of 10 to 50 people in size. Right? And so that really allows us to, like, forward deployed is much easier because you, in in most cases, talk to people who are decision makers who actually are gonna be, you know, running the account and interacting with all the primitives that we're building. And so it I guess the answer is it depends, but I would also say that over time, it just people become, and businesses become much more familiar with stablecoins, so I think it's becoming our job is becoming much easier as we go. Okay. So breakdown

Speaker 2: if somebody's keeping the majority of their assets, what they might keep in a traditional bank account with you, and then they wanna run payroll, or they they need corporate cards to pay for software, what happens then?

Speaker 4: So the way it works, you at this point, the ecosystem is mature enough where we're able to facilitate all of this through a stablecoin balance. Right? So you can either top up your deal balance or, you know, rippling balance from a stable stablecoin balance in account via ACH and traditional rails. A lot of these providers actually already accept stablecoin payments. Right? So you can actually top up and use DC directly without ever going into fiat. Mhmm. And then from a from a perspective of issuing cards, it's a, you know, it's a massive market already in crypto, where you have stablecoin backed cards, which allow you to spend directly from the stablecoin balance. There's a lot of companies in the space. I think right now, Stripe sessions is happening as we speak, where they're also definitely gonna talk about stablecoin cards, which is a, you know, a big focus for Stripe internally as well. Mhmm. And so those two things specifically are are definitely a reality. I would say there's still limitations. Right? Like, there there's smaller things. For example, if you wanted to ACH pool, that is still being worked on by a lot of the providers, and we're still spending kind of a lot more time trying to figure out what is the right structure to actually make it happen, because the idea is that you need to pull in stablecoins from the Altitude account, but then settle in fiat on the on the other end. But also, as more of these vendors start adopting stablecoins, our life is becoming much easier.

Speaker 2: Security. How I I think some people might might might say like, yeah, working with my bank is a little bit annoying. There's some things that I don't like. Sometimes I have to go into the bank to you know physically

Speaker 1: back the ledger up on tape deck in a mountain. You hacked, they're gonna set the ledger back to the way it was and the, you know, crypto is a little bit different sometimes.

Speaker 4: Security is a a huge concern for the space since the beginning. Right? And I think solving that is is paramount. We actually started from a place where we when we're building our infrastructure at Squads, it was all about security from the start. Right? Like, that's what we had to get good at. Right? And that's how we got to a place where today we Yeah. You have 10,000,000,000. Yeah. 10,000,000,000. Yes. And so that that is you know, that took us about four years to get to. And it it takes a lot of time to build that trust, but also to build infrastructure that actually, you know, works and it doesn't get hacked. Yeah. I think security actually, solving security is not the hardest part. It's balancing that with user experience. Right? It's like, how can you combine these two problems and have a customer that is able to stay in self custody, own their money, right, control their account end to end with their own keys Mhmm. Give them the security guarantees that they're expecting, while also allowing them to stay, obviously, with a stable coin balance. Right? And so I think what the way we solve it is we have a complex but kind of easy to explain system where we have multiple smart accounts and essentially these programmable accounts deployed for each customer Mhmm. Where the each individual signer on the account, so every member in on the sort of business level, they have their own programmable account with Sure. Granular controls and MFA they can set up. Right? And then the business account itself is a programmable object on the blockchain. And there's actually a lot of benefits to to kind of moving all of these layers onto the onto the sort of open and transparent system like a blockchain, because then you can have very clear guarantees in math and code. Right? Like, what is actually governing the security of your assets. Yeah. And I think when we talk to customers, right, a lot of it's like, lot of the questions come up. It's like, how do I think about something that you guys are building versus just using an FDIC insured bank account. Right? And I think what we always talk about with those customers is that the only reason FDIC exists is because your money is not actually there. Right? It's being fractionally reserved, and it's being lent out somewhere. And obviously, you have this, like, you know, off chain ledger, where somebody is maintaining and making sure that, you know, all the entries are correct. And so I think transparency brings a lot of trust and actually helps us to to get the product to a place where a lot more customers can can be comfortable with it. But obviously, the Squad's background and building a lot of infrastructure that, you know, secures billions today is definitely, you know, a big lever here as well. Tell us about the round. How much did you raise? Who led the deal? We raised 18,000,000. Solana Ventures led the round. We started the company in 2021, building out Solana from day one. And so, for us, it's been a It's been a journey, It's been a journey, exactly. And we we spent a lot of time with the Solana team, and we obviously are very deeply ingrained in the ecosystem. And now with Altitude, we're essentially using Solana as this secure, programmable back end, right, to deliver the experiences for businesses we we want to deliver. Right? Also in the round, we have Coinbase Ventures, Horn Ventures that we have partnered for the first time last year now. They're continuing the involvement, and then Electric Capital Placeholder, and and a few others. But, yeah, we're really excited. It's really they're they're primarily for accelerating altitude and helping businesses move their operations onto stablecoin rails, but we're obviously continuing to do things in in the crypto space with Squad MultiSIG, which is our, you know, first in core product. Fantastic. Well, congrats on the round. Thank you so much for taking the time to Yeah. Great meet us. Have a great rest of your day. Thanks. Talk to you soon. Cheers. Bye. Thank you. Up next we have Kashy Gupta from High Touch. He's the co CEO

Speaker 1: with a massive round for bringing him in. Marketing agents. I gotta say guys,