Baselayer raises $35 million, launches AI agent identity suite

Baselayer started in February 2023 with a focus on Know Your Business, or KYB, identity verification — the process financial institutions use to verify businesses and assess risk. Co-founders Jonathan Awad and Timothy Hyde set out to modernize that lengthy and fragmented process. The company built what Awad describes as both an identity network and a fraud consortium, recognizing when the same person or business applies at multiple institutions. That data becomes more useful as more institutions and reseller partners join.

The challenge now is that AI agents present a different problem. Unlike a business with history, an agent may spin up for a single task and disappear, leaving little for a bank to evaluate. Baselayer's proposed answer is a credential that an authorized agent presents when it attempts a purchase or interacts with another business. The startup is working with agent developers, payment processors, merchants and fraud-detection providers — including FIS, Prove and Socure — to issue and recognize it. M13 managing partner Karl Alomar said his view of the company shifted as more companies began exploring payments made by AI agents.

Whether that credential becomes widely accepted is the open question. No dominant standard exists yet, and Baselayer must persuade a broad set of parties to recognize its system. The timeline is long: financial institution relationships typically take 12 to 18 months, and large merchant partnerships up to 24 months. Baselayer may reach some institutions faster through existing reseller relationships, but the outcome hinges on whether enough payment companies and merchants adopt its credential before competing approaches emerge. For financial institutions and merchants, the stakes are whether they can safely allow automated transactions without opening the door to faster, cheaper fraud.