Published May 18, 2026

What is your moat?

Building a ledger is famously hard to get right. AML and transaction monitoring, to comply with fraud regulations, is tedious. Building your own rewards engine that manages transfers and balances for your customers is complicated. These are all foundational problems that any company moving money will face. Naturally, software companies are popping up at a dizzying rate to solve them at scale. Interestingly, this reminds me of Fiserv, and a time when banks in the US couldn’t fathom a financial institution owning and maintaining their own ledger.

I’ve been thinking a lot about plumbers vs handymen. While a plumber focuses on pipes, a handyman is more general; sometimes they work on cables, other times they may hang up a curtain rod, once in a while, they look at pipes. Sardine, for AML compliance, can see all the flavors that bad and good transactions can come in. The more they see, the faster they become at detecting them, creating a flywheel that makes them really good at understanding the “pipes” of AML.

It seems that many software companies in this ecosystem are now becoming plumbers. Everybody is building original financial infrastructure that power parts of the stack, and making that their moat. It is easy to argue why this is a good thing; software for these purposes need to be written well. The more customers that use the software, the better the product becomes. But, it is also useful to ask: is your moat vendor management? If nothing in your stack belongs to you, what becomes your advantage?