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Wilmington Fintech Investment Firm Announces $750M Capital Raise

By Audrey Elsberry, posted Dec 6, 2023
A $750 million capital raise was announced on Wednesday by Canapi Ventures, a venture capital firm with ties to Wilmington and Live Oak Bank.
 
Its second raise, Fund II, brings Capani’s total assets under management to $1.4 billion, according to Canapi’s release. The fund has already been investing Fund II’s capital in companies such as Island, a privacy software company. Canapi announced that investment in in October.
 
Canapi Ventures was founded by CenterHarbor Advisors and Live Oak Bancshares. The firm specializes in early-stage financial technology companies. Canapi's partners include some Live Oak executives. CEO of Live Oak Bancshares, Chip Mahan, is a managing partner of the firm.
 
"Our connectivity in Washington and to its regulators has allowed us to help our companies better understand and comply with complex requirements while building alongside founders to maximize impact,” Mahan said in the release.
 
Canapi is backed by a network of financial institutions and investors called the Canapi Alliance. Since the previous capital raise, Fund I, was announced, the Alliance’s composition has almost doubled, according to Canapi, with a total of nearly 70 members.
 
Fund II will include investments in the firm’s signature industries, such as fraud and identity, financial infrastructure, lending and credit, payments and real estate technology, according to the release. But the newest fund will expand the firms focus to include AI governance, cybersecurity and climate technology’s connection with finance.

“Canapi Ventures is helping fuel the fintech revolution from our own backyard here in Wilmington,” Neil Underwood, Canapi cofounder and general partner, told the Business Journal.

Underwood is also a board director at Live Oak Bank. He stepped down from his role as president of Live Oak Bancshares in November to focus on the venture capital firm. 

“Canapi is an exceptional platform to release next generation technologies. As we invest in themes such as AI, data, cyber, infrastructure and payments, we are creating exciting opportunities for banks to improve and modernize financial services," he said. 
 
In Fund I, Canapi made 20 investments and estimates a delivery of approximately $40 million in annualized revenue from its investments. To date, the firm has led eight companies through two or more funding rounds, Canapi officials said.
 
Along with the announcement of Fund II, Canapi disclosed a geographic expansion. The firm’s offices are now in four cities — the existing Wilmington and Washington D.C. offices, and the newly-added New York City and San Francisco offices.
 
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