Skyflow and Plaid Partner in Effort to Bolster Fintech Data Security

Skyflow and Plaid Partner in Effort to Bolster Fintech Data Security

Skyflow, a company that delivers data privacy technologies to businesses, announced a collaboration with Plaid, a startup that enables finance companies to share data via API. Skyflow was most recently featured by TechCrunch when it received an outsized Series B fundraising round late last year, less than a year after raising a Series A. Plaid, a firm we’ve previously covered for its products, fundraising, and failed sale to Visa, needs a little introduction at this point.

We spoke with Skyflow CEO Anshu Sharma about the arrangement, which he characterized as a mechanism for Plaid clients to construct pre-configured data “vaults” in a phone conversation. The idea is that Plaid users may instantly store sensitive user data within Skyflow using the company’s own API, with no speed cost when accessing data. Sharma further emphasized that because of the technology that drives Skyflow — polymorphic data encryption — customers of his company’s data storage system may still execute workflows and analyses without decrypting their data.

At this point, the issue is simply how many Plaid clients desire a data storage service as Skyflow provides. (From our original coverage on the firm, TechCrunch offers a deeper dive into how the startup’s technology works.) The answer might be rather large. Because of its quick expansion, Skyflow has remained in TechCrunch’s sights. Sharma claimed that his firm had expanded eightfold in the three quarters before closing its Series B last year.

While his company’s fiscal first quarter doesn’t end for another week and a half, Sharma said Skyflow has already earned around twice as much “contractual ARR,” or contracted annual recurring revenue, than it did in Q4 2021. (Given that Skyflow’s next round, a Series C is clearly not early stage, I hasten to add, that it’s time for the firm to stop giving comparative data and shift to concrete metrics.)

What does the alliance mean for Plaid, from the other side of the equation? Plaid, I’m guessing, sees data privacy as an important pillar in the fintech space’s future; if customers lose trust in the security of fintech applications and services, their willingness to engage with them may drop. Plaid’s long-term potential would be harmed. Plaid values data privacy, therefore Skyflow was ready to create a unique version of its usual product recipe exclusively for the financial API Company’s clients. Everyone wins, right? We’ll see.