A fintech startup born from a decade of frustration with manual loan processing just landed $3.8 million to fix small business lending. Kaaj's AI platform automates credit risk analysis that typically takes days, shrinking it to minutes and making smaller loans economically viable for lenders. The seed round from Kindred Ventures and Better Tomorrow Ventures validates a massive market opportunity where most small businesses can't access capital simply because the economics don't work.
Kaaj just cracked the code on one of banking's most stubborn problems. The credit risk automation platform announced a $3.8 million seed round on Wednesday, promising to transform how small businesses access capital through AI-powered underwriting that cuts processing time from days to minutes.
The funding comes from Kindred Ventures and Better Tomorrow Ventures, backing founders who witnessed the lending crisis from inside major financial institutions. Co-founder Shivi Sharma spent a decade in credit risk at American Express and Varo Bank, watching teams spend equal time analyzing $100,000 and $5 million loans - making smaller loans economically unviable.
"She watched as the vast majority of small business owners couldn't access the capital they needed to grow, simply because the economics didn't work for banks," CEO Utsav Shah told TechCrunch. The married co-founders launched the company in 2024 after realizing AI could solve this decades-old inefficiency.
The numbers tell the story. Kaaj has already processed over $5 billion worth of loan applications, with clients including Amur Equipment Finance and Fundr. The platform's AI identifies, classifies, verifies, and organizes loan documents into existing Loan Origination Systems while checking for document tampering - work that traditionally requires days of manual verification.
"This allows a team processing 500 applications monthly to handle 20,000 applications with the same staff, making smaller loans economically viable," Shah explained. That 40x efficiency gain could unlock capital access for millions of small businesses currently shut out of traditional lending.
The system integrates with existing CRM platforms like Salesforce, HubSpot, and Microsoft, automatically flagging whether businesses meet lender policy criteria. It's a comprehensive approach that sets Kaaj apart from competitors like Middesk, Ocrolus, and MoneyThumb, which automate only portions of the credit analysis process.
