Collections fintech Akuvo gets funding for agentic AI

• Key Insight: Agentic AI could automate consumer hardship handling in collections.
• Expert Quote: Akuvo CEO Jay Mossman says AI can help the company scale without increasing headcount.
• Supporting Data: Only 13% of calls get answered, while 90% of customers respond to texts.
  Source: Bullets generated by AI with editorial review.

Several years ago, banks upgraded and digitized their debt collection infrastructure to comply with the CFPB's debt collection rule. Now, agentic AI is going to power collections technology for one fintech that works with banks and credit unions across the U.S.

Akuvo, a fintech specializing in collections and credit risk management, announced a "strategic investment" from global technology investment firm Vista Equity Partners on Thursday.

Akuvo CEO Jay Mossman told American Banker that a "strategic investment" meant Akuvo is gaining the necessary resources to focus on growing in the enterprise software market, specifically with banks and credit unions, and expanding its credit and collection risk products.

Akuvo is also looking to incorporate an assortment of agentic AI tools for its various departments, according to Mossman, so the company can grow in scale and efficiency without increasing its overall size.

"Because of what we're doing with Vista, we are adding some operational efficiencies that we think we can probably triple the company and not add anybody in our support areas," he said. "One of the challenges that companies have is, can they hire enough people to handle the growth? When you're a quickly growing company, your constraints, your bottlenecks, are usually in talent. If you can get AI to take over that talent, it takes that out of the equation and allows you to grow quickly."

One example of where Akuvo wants to incorporate agentic AI is in its consumer-facing virtual collector, which currently sends automated text message reminders in lieu of phone calls for overdue debts.

Several other fintechs that operate as digital-first debt collections agencies, including TrueAccord, January and InDebted, also currently use data-driven models to fine-tune their outreach to delinquent borrowers based on the way they engage with texts and emails. 

Proponents of these methods, including Mossman, say they are more convenient than speaking to a human on the phone and point out that digital messages or chatbot responses can be scripted to strike the right tone of encouragement.

"We've gathered anonymized data across all of our customers, and only 13% of all phone calls get answered but 90% of customers respond to text," he said. "When people go delinquent, they're embarrassed, right? So they're more likely to deal with a non-human, especially if it shows empathy to them."

By incorporating AI into the virtual collector tool, Mossman wants it to replicate a "human-like" experience with delinquent consumers and guide them into repayment more actively. For example, the virtual collector could ask a delinquent consumer how they lost their income and respond, based on policies the institution has put in on the back end, with options and programs that can help the consumer with repayment.

"The reason why we wanted to go after Vista's investment is we now want the AI to take over and actually work through that hardship with the person, including going back and maybe re-underwriting and modifying the loan and all those things in the future," he continued.

Akuvo will be using a combination of internally built AI tools and external agents from third-party partnerships, including through Vista's Agentic AI Factory initiative as part of the firm's investment, according to Mossman. A Vista spokesperson confirmed with American Banker that Vista portfolio companies are provided with prioritized access to expert teams from Microsoft through the Agentic Factory.

Akuvo currently provides collections technology to over 150 financial institutions such as Pennsylvania State Employees Credit Union, Prosperity Bank in Texas and California-based Beneficial State Bank. 

The investment from Vista has also earned support from existing Akuvo investors, including the $8.2 billion-asset Michigan State University Federal Credit Union.

"We're pleased to see Akuvo taking such a bold and strategic step," said April Clobes, president and CEO of MSUFCU. "They've proven they understand the needs of financial institutions, and this investment ensures they can deliver innovation at scale. Their AI vision isn't theoretical; it's a tactical strategy to make real, measurable improvements in how we serve our members and manage risk."

Vista Equity Partners specializes in enterprise B2B software companies for its investments. The firm's portfolio encompasses 90 software companies and around $100 billion in assets under management.

"Akuvo is tackling a critical pain point for credit unions and banks with purpose-built software that combines automation, analytics and compliance functionality in a highly intuitive solution," said Rachel Arnold, co-head of Vista's Endeavor Fund, which invests in small market cap companies with at at least $10 million in annual revenue.

The deal closed on Sept. 11. Neither company disclosed the financial details of the investment.