The founder of Simple is back with a new startup aimed at cutting down the time it takes for entrepreneurs to create fintech with cryptocurrency and regular money.

On Tuesday, Shamir Karkal unveiled Sila, an application programming interface platform with a developer suite that issues stablecoin on Ethereum blockchain called Sila Token.

The goal of the platform, he said, is to cut out the need for fintechs to partner with banks to develop ACH processing for their companies.

“Simple, Digit, Acorns, Stash, WinWin and a dozen other [apps] all take on different aspects of spend less, save more and automate it. For Sila, that’s a target market,” Karkal said. “I don’t see any reason why there can’t be a 1,000 more of those startups. Obviously not all of them will succeed, but we’ll get more successes, and we will have more people trying more things that I don’t see coming out of Wall Street.”

Sila offers APIs for ID verification, account linking, as well as ACH processing for issuing, redeeming and transferring Sila and transacting with regular money. While users can’t build a full-fledged bank from the platform, they don’t have to waste time finding an ACH processing partner to create their technology.

Sila makes money from transaction fees whenever somebody moves money using its APIs and also by earning a yield on the underlying assets in the reserve pool of Treasuries.



The startup has $770,000 in seed funding from the same investors who put a stake into Simple, including venture capital veteran Jerry Neumann of New York-based Neu Venture Capital; Taavet Hinrikus, co-founder of international payments platform TransferWise; and Iyinoluwa Aboyeji, co-founder and managing director of African payments platform Flutterwave.

Neumann hopes that Sila can play a part in breaking up big banks — like the conglomerates in the 1960s that were broken up when they no longer served a need.

“Functional specialists who are the best in narrower classes are emerging, interconnected with the rest of the banking system," Nuemann said. "This interconnection piece is the reverse salient holding everything else back.

“Sila is addressing this bottleneck and if they are as successful as I believe they will be, and if the banking sector evolves as I believe it will, demand over time will be enormous. As the platform, Sila can be financially successful even while they drastically lower banking costs for their customers.”

In the development of Sila, Karkal and his team have partnered with ACH processors, ID verification providers, regtech providers, banks, and capital markets custodians. Karkal hopes to save fintechs the trouble of having to do the same heavy lifting on the back end before creating a new application.

“I like to think of ourselves as the [Amazon Web Services] of finance, which doesn’t exist in the moment,” Karkal said. “The APIs are all state of the art, but the ACH is a janky 35-year-old system that has weird failure modes, and its batch takes multiple days. So you have to manage that complexity.”

For the first six months, Karkal isn’t searching for massive adoption of the platform, but for developers to give him feedback about what works and what doesn’t.

Currently, Sila has a sign-up list for developers, and the company is only letting selected developers use the platform. In the first quarter of next year, the technology will enter into a beta phase where everyone can have a sandbox in Sila and begin creating.

The trickiest part of Sila is remaining autonomous: Making sure that when the user gives Sila cash for tokens that there’s no point where Sila is holding the customers money without having issued tokens at the same time.

With the Sila token being held to the U.S. dollar, Karkal hopes to reduce the volatility of the asset and also make crypto fintechs more common.

“The only way you can achieve stability is by holding a reserve in a real world asset that closely corresponds with what you’re pegging for,” Karkal said. “Especially in the crypto world, it feels like people are trying to build complex derivatives in code, and I remember October 2008 and what happened to complex derivatives within legal contracts when everybody left the system. In good times everything works, in bad times some things work and some things don’t.”

Sila plans to go through several more rounds of funding as it scales and with it’s connection to Simple — considered a darling of the early waves of fintech — it shouldn’t have trouble finding funds, said David Mort of Propel Venture Partners.

“Shamir more than anyone recognizes the need for developers to not have to work with clunky infrastructure and to be able to leverage best in class developer tools,” he said.