Laura Kornhauser was working with a team at JPMorgan Chase that had developed a new product offering quantitative investment solutions when the Dodd-Frank Act came out, just before her product launch date.
"We ran into a brick wall because we didn't have the right technology to comply with this new regulation," she said. "That really opened my eyes to the opportunities that are at the intersection of finance, technology, and regulated use cases to build better tools and technologies that help banks continue to grow and compete."
That got her thinking about starting her own financial technology company. If JPMorgan Chase has such needs, she reasoned, community and regional banks must face an even stiffer challenge dealing with the changing regulatory environment.
"That got me started on the path towards entrepreneurship," Kornhauser said.
Her parents were entrepreneurs who started a software company around the time that she was born. She worked for that business in high school and college.
"I had always had that dream [of starting a business], and this experience at JPMorgan Chase helped me realize, hey, it's the right time to chase that dream," she said.
Further inspiration came when Kornhauser was in business school. She was heavily marketed a credit card product from Chase that had a good loyalty program, but when she finally applied for it, she was rejected due to lack of current income. She called the bank, spoke to several people and got them to approve her.
"That really opened my eyes to the misses that so many lenders are having in the way they make decisions on loan applications and the great customers that they're often leaving out in the cold because they maybe have one indicator, in my case it was current income, that is not what they want to see," Kornhauser said. "But there are plenty of other indicators that prove that that borrower would be a good customer for them and they're not seeing those or not using those in the way that they should be."
She knew advanced modeling could be used to make fairer decisions and better outcomes for borrowers and lenders.
Stratyfy offers loan decision software that looks at traditional credit data, but weights variables differently and moves away from sharp cutoffs. It also has a product called Unbias that does fairness testing and offers bias mitigation strategies.
Being a mother has inspired Kornhauser throughout the multiple twists and turns of starting a company, she said. She has a 3-year-old and an 18-month-old. She closed financing rounds the day before delivering both children. When she demonstrated Stratyfy's technology at Finovate 2020, she was eight and a half months pregnant.
In July 2023, Stratyfy announced a partnership with the Beneficial State Foundation through which 20 U.S. lenders will use Stratyfy's artificial intelligence software to address racial disparities in lending.
