Plenty of local startups in the DMV get their start in the powerhouse defense and government contracting spaces in DC. But Alexandria, Virginia-based supply chain risk startup Ion Channel has picked a new lane for its software.
The 16-person startup, which also has offices in Portland, Oregon, was recently selected to participate in the FinTech Innovation Lab in New York City, an accelerator for startups moving into fintech. The 12-week cohort, which is funded by Accenture and the Partnership Fund for New York City, features nine other companies from around the world, and allows participants to work with large financial institutions. According to Maria Gotsch, president and CEO of the Partnership Fund cofounder of the innovation lab, the accelerator primarily focuses on finding potential customers for participants.
“It’s for companies like Ion Channel that are further along in their development and are at the point of wanting to, in a really accelerated way, access the financial services market broadly,” Gotsch told Technical.ly.
Ion Channel, which was founded in 2016, works in the risk assurance space of supply chain technology for clients in national security, defense and beyond. Cofounder and CEO JC Herz said Ion launched to mitigate risk along the supply chain by offering insight into the risks from software suppliers like vendors and government contractors, and allows users to more effectively manage their work with these partner companies. Alongside the accelerator, the company is in the midst of raising an $8 million to 10 million Series A.
“What Ion Channel allows the third-party risk people and procurement people to do is understand whether the outside is bright and shiny, but is the inside brittle and moldy?” Herz said.
Ion Channel's acceptance to the accelerator speaks to its potential in applying its product to the fintech market, Gotsch said.
At the moment, Herz said, supply chain risks and threats often come from the components being used to build software, since there’s a lot of open source code and information. Ion looks beyond known vulnerabilities and into leading indicators and threat information.
With the accelerator, she hopes that she can grow the company and get a leg up in the fintech space.
In financial services, Herz said, the organizations her company would look to work with are “so vast that you really do need a sherpa to help you get to the top. So I would view, in that analogy, the New York FinTech Innovation Lab is almost like the base camp for the people who are going to scale those mountains to actually acclimate and get ready to scale those peaks.”
As the company grows, both with the accelerator and the funding round, Herz plans to expand the Ion team on both the engineering side and sales and marketing. Herz said she plans at least double the size of the team following the program, in both its hometown of NoVa and in NYC.
What she really hopes, though, is that the program can help bring the software beyond government and defense and into the fintech and financial services space.
“Ion Channel and the other nine that are in the cohort, the fact that they were selected by the financial institutions is really an interesting insight into what the priorities are and really speaks to the fact that what they’re doing is of high interest to the financial services sector,” Gotsch said.
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