Exclusive: Can You Trust That AI Agent? Baselayer Raises $35M To Help Companies Decide

Baselayer, an artificial intelligence startup specializing in business verification and fraud risk assessment for financial institutions, has secured $35 million in a Series A funding round to scale its identity verification technology for AI agents.

The San Francisco-based enterprise was backed by lead investor M13, alongside participants Picus Capital, Torch Capital, Afore Capital, and Socure’s Matt Thompson. According to co-founder and CEO Jonathan Awad, this latest infusion brings the firm’s total capital raised to approximately $40 million since its founding in 2023. The startup chose to keep its valuation private.

Baselayer integrates business identity, credit history, and fraud metrics to assist banks, fintech firms, and alternative financial-services providers in vetting potential customers. Its services are offered directly or through software partners who white-label or resell the technology. The platform’s automated architecture initially centered on risk management, fraud detection, and Know Your Business (KYB) onboarding.

Awad notes that over 2,000 financial institutions—comprising more than 20% of such organizations across the United States—utilize the platform to open accounts, underwrite clients, and onboard merchants. Operating with a team of roughly 50 employees across offices in New York and San Francisco, Baselayer also serves Fortune 500 clients. The company reports that its software has helped customers prevent over $1 billion in fraud since inception.

While withholding precise revenue figures, Awad shared that Baselayer crossed the eight-figure annual revenue threshold in under two years.

The fresh funding is now being directed toward a rapidly emerging verification hurdle: confirming whether an AI agent possesses proper authorization to act on behalf of a specific individual or corporation.

As consumers increasingly deploy AI agents for routine tasks like booking restaurant tables, distinguishing between legitimate automated requests and malicious activities—such as data scraping or fraud attempts—grows increasingly difficult.

Alongside the funding announcement, Baselayer is debuting its Agentic Identity Suite, which broadens its coverage network from traditional businesses to the AI agents executing transactions on their behalf.

From businesses to the agents acting for them

Awad launched Baselayer alongside co-founder Timothy Hyde in February 2023 to tackle the traditionally fragmented and protracted procedures financial institutions navigate for business verification and risk assessment.

“What we set out to do was essentially bring risk assessment to the 21st century,” Awad recalled.

Baselayer functions simultaneously as an identity network and a fraud consortium. Because thousands of financial institutions utilize the software, the firm can detect when a single entity applies across multiple platforms, factoring those signals into subsequent risk scores.

Processing tens of millions of submissions annually, Baselayer frequently encounters the same businesses multiple times a year. Awad explains that this repository grows increasingly valuable as more reseller partners and institutions enter the network.

“We’ve essentially streamlined 10 years’ worth of selling into two years,” he noted.

Conversely, AI agents introduce distinct operational challenges. Often instantiated for a singular assignment before disappearing immediately afterward, they leave minimal historical data for financial institutions and risk assessors to analyze.

“Agents spin up and they spin down,” Awad said. “How can you trust this random one-task agent?”

To mitigate this challenge, Baselayer is spearheading a framework known as “Know Your Agent” (KYA). The system aims to identify the agent’s creator, the principal entity represented, and whether explicit permission has been granted for a given task.

The strategy involves equipping authorized agents with verifiable credentials to present during purchases or commercial interactions. Upon receipt, platforms, merchants, or financial institutions can evaluate the credentials to decide whether to clear the transaction, Awad clarified.

To issue and validate these credentials, the startup is collaborating with payment processors, merchant networks, agent creators, and fraud-prevention entities, including Prove, FIS, and Socure. Without proof of authorization from legitimate persons or companies, Awad warns that “agents will just get blocked everywhere.”

AI can also make fraud easier to scale

Ironically, the underlying technology enabling lawful agents to boost productivity also empowers bad actors to accelerate illicit operations.

Historically, identity fraud required obtaining stolen personal and business records, building a convincing persona, and submitting repeated credit card or bank applications until approval was secured—a manual and time-consuming endeavor. Today, however, autonomous AI tools can automate and accelerate these steps continuously.

“It’s fraud on steroids right now,” Awad stated. “It’s so easy, it’s so cheap, it’s so fast, and it’s 24/7.”

Recent disclosures regarding AI agents circumventing system limits have further intensified debates over securing and identifying autonomous code. OpenAI recently revealed instances where its models took deceptive or unauthorized steps, including events tied to the Hugging Face ecosystem.

Awad acknowledged that Baselayer’s tooling cannot prevent a model from bypassing commands or exploiting security flaws. Instead, the focus remains on validating agent credentials during interactions or transactions with external entities.

Without standard identification mechanisms, he cautioned that legitimate agents may resort to dodging website restrictions merely to finish assigned duties—or experience diminished utility due to repeated blocks as suspected malicious bots.

Competing to establish a standard

M13 managing partner Karl Alomar noted in an interview with Crunchbase News that he met Awad roughly a year prior to making an investment, initially perceiving the startup strictly as a KYB provider.

“The business did not feel like a business of the future,” he admitted. “It just felt like he was solving a KYB banking verification problem.”

That perspective shifted as broader interest grew around AI-driven payments and Baselayer applied its merchant data repository to the domain.

“Every agent ultimately is going to have to be tied to something real, and they understand the real world,” Alomar said.

Alomar believes Baselayer’s existing institution relationships, data stores, and identity network provide a strong competitive edge over greenfield competitors.

“AI agents are rapidly becoming economic actors, but the identity infrastructure underneath commerce was never designed for software that can open accounts, make purchases, move money or enter into transactions on someone else’s behalf,” Alomar added. “That creates an enormous new trust problem, and we believe identity will become one of the foundational infrastructure layers of the agentic economy.”

No dominant protocol currently governs the space, meaning Baselayer must actively convince merchants, payment providers, financial institutions, and agent builders to support its credentials.

Such adoption requires patience. Awad noted that bank integrations typically span 12 to 18 months, whereas enterprise merchant partnerships can extend up to 24 months, though established reseller pathways may accelerate integration timelines for certain groups.

Beyond traditional payments, the startup anticipates future applications in smart contracts or cryptocurrency transactions.

“This is not just a fintech business — it’s a security business,” Alomar concluded. “It begins with payments, but ultimately that technology applies directly to anywhere that an agent is making a decision that you need to verify it is permitted to make.”

?Frequently Asked Questions

01What is Baselayer?

Baselayer is an AI-powered startup that provides identity verification, fraud risk assessment, and Know Your Business (KYB) solutions to financial institutions and fintech companies.

02What is the new Agentic Identity Suite?

The Agentic Identity Suite is Baselayer’s new offering designed to verify whether an AI agent is authorized to act on behalf of a specific person or business, introducing a “Know Your Agent” (KYA) verification process.

03Who funded Baselayer’s Series A round?

The $35 million Series A funding round was led by M13, with contributions from Picus Capital, Torch Capital, Afore Capital, and Socure’s Matt Thompson.

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Illustration: Dom Guzman