Traditional financial service providers continue to search for ways to maneuver the perilous competitive waters stirred up by fintech providers. 

The Curql Collective offers a collaborative approach that provides “swim lanes” allowing credit unions to navigate these waters. The credit union service organization’s (CUSO’s) flagship, Curql Fund I, “brings transformative technology to the credit union industry,” says Nick Evens, president/CEO of the Curql Collective. 

Members Development Co. incubated the idea and launched the collective as two independent CUSOs in 2020. The collective includes 68 limited partners made up of credit unions, CUSOs, National Cooperative Bank and a league service corporation.

While Curql Collective provides collaborative solutions that benefit both fintechs and credit unions, limited partners invested directly in Curql Fund. Evens says the arrangement makes credit unions more attractive and relevant as partners, a place where fintechs can access capital incubation and piloting opportunities.

Curql Fund I was closed to investors when it reached $252 million in capital, the CUSO announced Oct. 31. The fund, managed by Next Level Ventures, was originally slated to close to investors at $150 million, but due to strong interest the cap was raised allow for additional participation, according to Evens.

“That speaks to the digital-first mentality credit unions have today,” Evens says. “They’re truly excited to be part of the fintech ecosystem.”

Evens says return on investment is secondary among Curql’s investment goals. “Our premise is to help our credit union limited partners remain relevant and compete against fintechs that are trying to disintermediate us, and against big banks. Our primary driver is to remain relevant through fintech partnerships.”

So far, Curql has funded nine investments and is awaiting final legal approval on a 10th.

It has invested in a digital banking provider, a company that provides digital engagement platforms, a provider of cloud-based cybersecurity-related services, and other companies.

“All of our portfolio fintechs already serve credit unions,” Evens says. “They understand our market.”

Among Curql’s investors is Envisant, a subsidiary of the Illinois Credit Union League. Envisant’s $2.4 million investment in Curql included contributions from 13 Illinois credit unions and two other leagues, says Libby Calderone, president and chief operating officer.

“It’s one way we’re living out our commitment to help credit unions achieve their vision,” she says. “Fintechs are vital to advancing the competitive strength of credit unions in the financial marketplace. By combining resources we’ve leveled the playing field, giving more credit unions access to the benefits of disruptive, game-changing fintech solutions.”