Note: This article was translated from Japanese by Alpaca. Read the original interview by NewsPicks.
Alpaca, a financial startup founded in the US by Japanese entrepreneurs, became a unicorn after raising $150 million USD in its Series D round in January 2026. The round valued the company at $1.15 billion USD and brought its total funding to more than $320 million USD.
Alpaca operates in the field of securities infrastructure APIs. Its platform supports financial institutions and fintech companies behind the scenes, helping them build brokerage and investment products through API-based infrastructure.
Today, Alpaca supports over 10 million brokerage accounts through more than 300 fintech companies and financial institutions across more than 40 countries.
Co-Founder and CEO Yoshi Yokokawa describes Alpaca’s ambition as building the “AWS of finance.” The goal is to provide securities trading functions as infrastructure, enabling companies around the world to build financial services on top of Alpaca’s platform.
So, what exactly is Alpaca? How has it grown through its business model, and how far does it intend to reshape the structure of finance?
NewsPicks spoke with Yokokawa to hear the full scope of his vision.
Raised $150 million from global investors
In this $150 million funding round, the lead investor was US-based Drive Capital. The investor lineup also shows the depth of Alpaca’s strategic network.
Participants included Mitsubishi UFJ Innovation Partners, under Mitsubishi UFJ Financial Group (MUFG); Citadel Securities, one of the largest market makers in the United States; and Opera Tech Ventures, affiliated with France’s BNP Paribas. The round brought together investors across traditional finance, trading and technology. In addition, Keisuke Honda’s X&KSK, major US cryptocurrency exchange Kraken, and the co-founders of UK-based Revolut and Sweden’s Klarna also participated.
Endeavor, one of the world’s largest entrepreneur support networks based in the US, is also among the investors. This round is not only about raising capital. It also expanded Alpaca’s global strategic network.
Existing investors such as Canada’s Portage Ventures and Hong Kong-based Horizons Ventures also continued their support.
Another notable aspect of this round is the $40 million USD credit line secured alongside the fundraising. This is different from the typical equity financing of a technology company. It reflects Alpaca’s business model.
NewsPicks: What is the significance of the $40 million credit line secured alongside the fundraising?
Yoshi: “Securing this credit line is deeply tied to our business model. While we are a technology company that provides APIs, we are also, in practice, a fully licensed brokerage firm that holds and moves client assets. To continue scaling while fulfilling the functions of a brokerage, strengthening our balance sheet was essential.”
“We are similar to a trust bank”
NewsPicks: So, what exactly is Alpaca?
Yoshi: “In a nutshell, we are a brokerage firm specialized in API connectivity. If I had to compare it, we’re like the AWS of finance. We provide all the functions of a brokerage firm responsible for clearing and settlement entirely through APIs.
By thoroughly building and automating our back office and middle office in-house, we scale while continuously lowering costs, just like AWS. That’s how we operate.”
The functions of a brokerage firm can broadly be divided into three parts: (1) the front office, such as interfaces and apps that investors directly interact with, and (2) the middle office and (3) the back office, which handle trade management, clearing, and settlement.
Alpaca focuses on the latter two. In other words, it focuses on the core of the securities business.
Yoshi: “What we do is operate a brokerage focused specifically on the middle office and back office. We rigorously build out APIs and focus on how easily financial institutions that interact with end users can implement securities functionality.”
In industry terms, Alpaca’s position is that of a clearing broker, a brokerage firm responsible for post-trade clearing, settlement, and custody.
Yoshi: “At our core, we are a brokerage that handles the trust and custody of money and securities. In Japanese terms, you could say we are close to a trust bank. In essence, we are like a wholesaler of securities, a company that provides the underlying securities infrastructure itself.”
Alpaca does not provide a specific app or brand of its own. Instead, it operates behind various fintech companies and banks, functioning as the core of securities trading. Alpaca is committed to staying behind the scenes.
That makes Alpaca’s business somewhat difficult to understand at first glance. That’s precisely why Yoshi chose a friendly animal, Alpaca, as the company name.
Yoshi: “Even in the age of AI, ultimate accountability lies with humans. It is engineers who design system architecture, and it is not AI but brokerage employees that bear responsibility to regulators. That is precisely why we must build an organization that gathers top talent from around the world, regardless of location, where individuals can take ownership and act autonomously.”
Not just a systems company
Alpaca’s business model is that of a clearing broker that provides the infrastructure for securities trading via APIs. Existing financial institutions and startups do not need to build heavy systems in-house. By connecting to Alpaca’s infrastructure, they can launch advanced securities services under their own brand.
The business consists of two main pillars.
One is the Broker API for enterprises. Brokerages, digital banks, and investment apps can implement investment functions under their own brand. These functions include opening accounts for securities and crypto assets, deposits, trading, and custody.
This helps them navigate complex regulatory compliance and backend development. It also enables them to focus their resources on developing the UI and UX that directly engages customers.
The other is the Trading API for individual investors and algorithmic traders. It provides real-time data for securities and crypto assets, along with features such as paper trading environments and advanced order functions.
A key strength lies in its API-first design. Low latency, high-speed processing, and operational reliability capable of handling long trading hours have earned recognition. As a result, more than 300 financial institutions across over 40 countries now use Alpaca’s infrastructure. NewsPicks: Given how system-oriented this business is, isn’t Alpaca more of a systems integrator than a brokerage?
Yoshi: “People often have the impression that we are like a systems company, but in reality, it’s the complete opposite. We take pride in operating one of the most heavyweight businesses in finance. We are not simply selling systems. Behind the scenes, we are entrusted, under proper licenses, with managing and safeguarding vast amounts of funds and securities. In reality, we are a heavyweight brokerage firm specialized in technology.”
This statement does not seem to be an exaggeration. In its tokenization business, the company’s custodial holdings of underlying assets have surpassed $480 million. As of the end of 2025, it has achieved a 94% share of the global market. While major banks remain constrained by legacy systems, API-native Alpaca is attempting to redefine the standards of next-generation finance.
Three consecutive years of 2× growth
Its business performance is also growing. Over the past three years, revenue has increased at roughly a twofold pace each year. Alpaca’s revenue model is not based on one-time system sales. Instead, it combines stock and flow elements typical of financial businesses.
There are three main sources of revenue: interest income generated from customer cash balances, securities-related income earned from custody and management of securities, and execution revenue generated when trades occur.
NewsPicks: How does Alpaca’s revenue model work?
Yoshi: “Our business model is purely that of a clearing brokerage. Conceptually, it is closer to a bank. Banks hold customer cash and earn interest on it. In our case, in addition to that, we also hold securities in trust. So in addition to interest income from cash, we generate revenue from stock lending and margin trading interest that arise from holding securities in custody, as well as various fees that accumulate over time.”
In other words, Alpaca has a stock-based business model in which revenue accumulates as assets under custody grow. It also benefits from increased flow-based revenue when markets are active. Although it is financial infrastructure, it also has significant upside potential depending on market conditions.
Financial businesses are fundamentally a two-story structure of stock plus flow. The first floor is “stock.” As assets held in trust increase, interest income accumulates. The second floor is flow. This is the revenue generated when trades or transactions occur.
Yoshi: “Since we handle not only custody but also trade execution, we earn fees when we connect to market makers and execute trades. In the US market, there is also a mechanism called “PFOF (Payment for Order Flow*), where brokers receive compensation by routing customer orders to specific market participants. As assets under custody grow, stock-based revenue becomes more stable, and as trading activity increases, flow-based revenue expands. Structurally, it is similar to a bank, but we believe it also has the upside unique to securities.”
(*) PFOF refers to the fees received from third parties in exchange for directing customer orders to them.
The moat is the “connectivity experience”
At the core of the securities industry lies clearing, a large piece of infrastructure that has changed little since the US Securities Act of 1933. It is not easily visible to end users, yet it is one of the most critical infrastructures in the industry. In this domain, firms such as BNY Pershing and State Street have much longer histories and larger asset bases.
From the perspective of licenses and memberships, Alpaca operates in the same field as these institutions.
NewsPicks: So what sets Alpaca apart, having grown into a unicorn with a valuation of $1.15 billion?
Yoshi: “The clearing brokerage business itself is a traditional industry that has existed since 1933. In terms of licensing structure, what we do is fundamentally the same as what major financial institutions like State Street, BNY, and Goldman Sachs do. However, the biggest difference is how easy it is to connect.
If you go to one of the traditional giants and ask to add securities functionality to your service, it can take several months, sometimes even years, just to open an account. Moreover, what you receive at the connection stage is not an API, but often unclear specifications or files. In some cases, you are even asked to communicate via Excel. That has been the industry norm.”
This is similar to how the payments industry used to be. There was a time when simply implementing online payments required massive paperwork and phone negotiations. Stripe replaced that process with just a few lines of code. Yoshi says that Alpaca is aiming to do the same for securities.
Yoshi: “We are now in an era where developers hold decision-making power. In that context, traditional formats are no longer even a viable option.
When developers go looking for proper infrastructure, there is no one else. Only us. What we provide is an API-based brokerage directly connected to the back office and middle office.
With this API, there is no need to build a brokerage firm from scratch. Large enterprises can connect to it, and individuals can write their own automated trading programs. We don’t restrict how it is used."
Alpaca’s moat, or barrier to entry, is not simply its licenses. Rather, it lies in a philosophy that was missing from the traditional securities industry: trusting developers and giving them freedom.
Yoshi: “We believe that the moment you decide how an API should be used, it stops being an API. The essence is that developers can use it however they want.
In the beginning, our API had no extra features. It was essentially bare. Developers gathered around it and later created use cases themselves, including automated trading.
We believe that this developer-first philosophy is what allowed us to establish a unique position, even while always being mindful of existing players like Interactive Brokers.”
Expansion outside the US is accelerating
A key factor in Alpaca’s growth is the speed of its global expansion. Its business operations have already spread to more than 40 countries, with increasing penetration in major markets such as the Middle East, Europe, and Asia. Partnerships with players in each region are driving this expansion.
Major cryptocurrency exchange Kraken in the US, SBI Securities in Japan, Midas in Turkey, and Dime! in Thailand are financial players with a local presence. They are adopting Alpaca’s infrastructure to deliver investment experiences to users in their respective markets.
Supported by this global demand, revenue has grown at nearly a twofold pace over the past three years. The company expects to maintain a similar growth rate this year as well.
A major shift toward blockchain
Armed with the $150 million USD it has just raised, Alpaca is stepping into its next phase of growth. What lies ahead is a major shift that could reshape financial infrastructure.
Yoshi views the evolution of financial systems as a three-stage progression: paper, computers, and on-chain systems, where assets and transactions are managed on blockchain.
NewsPicks: How do you view the next phase of financial systems?
Yoshi: “Following the transition from analog to computers (DX) that began in the 1970s, we are now witnessing a once-in-50-years transformation: the shift to on-chain systems. Stablecoins and the tokenization of securities, which are currently attracting attention, are only the beginning.”
Yoshi is targeting the global custody market, estimated at $350 trillion. In this market, the four major custodians, BNY Mellon, State Street, JP Morgan, and Citi, collectively hold about $180 trillion in assets under custody (as of the end of 2025).
It is a highly concentrated market dominated by these players. However, Yoshi sees opportunity precisely in that structure.
Yoshi: “While the global securities market is worth around $350 trillion, existing giants are constrained by legacy systems and cannot easily transition to an on-chain world. While they hesitate, we aim to fully build a new API-based on-chain infrastructure and become the next generation of BNY Mellon or State Street. That is Alpaca’s goal.”
As mentioned earlier, Alpaca has already surpassed $480 million in custodial holdings of underlying assets in its tokenization business, capturing a 94% share of the global market.
Yoshi: “True demand only emerges when liquid assets are tokenized. We have already established a significant position in that space. By replacing analog financial infrastructure with on-chain systems, we aim to rewrite the balance of power in the financial industry.”
A financial startup founded in the United States by Japanese co-founders is aiming to become the AWS of finance. The challenge to transform a market structure worth hundreds of trillions of dollars is now underway.
Contact Alpaca
Alpaca and the entities mentioned in this article are not affiliated and are not responsible for the liabilities of others.
The content of this article is for general informational purposes only. All examples are for illustrative purposes only.
Alpaca Securities LLC (dba "Alpaca Clearing") and Alpaca Crypto LLC do not conduct tokenization of assets. Together, they provide technology and services that support third-party partners who perform the tokenization. For more information, please see our Tokenization Risk Disclosure.
This is not an offer, solicitation of an offer, or advice to buy or sell securities or cryptocurrencies or open a brokerage account or cryptocurrency account in any jurisdiction where Alpaca Securities or Alpaca Crypto, respectively, are not registered or licensed, as applicable.
