The Rise of Financial Infrastructure as a Service: Why Alpaca's $1.15B Valuation Signals a Market-Defining Opportunity

is projected to reach $190.32 billion in 2025, growing at a compound annual growth rate (CAGR) of 20.8% through 2032. Within this, the FIaaS sector is emerging as a high-growth subset, driven by the need for scalable, modular, and cost-efficient solutions to support digital payments, real-time settlements, and cross-border transactions. According to a report by Precedence Research, the broader IaaS market is expected to expand from $155.03 billion in 2024 to $175.0 billion in 2025, while Statista forecasts a 18.14% annual growth rate through 2030. These figures underscore a market in hypergrowth, with FIaaS players like Shift4, ACI Worldwide, and Remitly leading the charge in payments and remittances.

However, the FIaaS sector is not a monolith. While companies like Binance and Circle are capitalizing on digital assets and stablecoins, Alpaca has carved out a niche in brokerage infrastructure-a space where the convergence of traditional finance and blockchain technology is unlocking unprecedented value.

Alpaca: The Brokerage Infrastructure Standard

Alpaca's $1.15 billion valuation, achieved after a $150 million Series D funding round, led by Drive Capital, reflects its dominance in the Brokerage Infrastructure as a Service (Brokerage IaaS) segment. The company's platform empowers over 300 organizations across 40+ countries to offer access to stocks, ETFs, options, crypto, and fixed-income products. This global reach is underpinned by a suite of scalable APIs and self-clearing custody solutions, which eliminate the need for partners to build proprietary infrastructure from scratch.

What sets Alpaca apart is its ability to bridge traditional and digital finance. In 2025, the company launched the , a blockchain-based solution that integrates traditional brokerage systems with tokenized assets. This innovation not only accelerates settlement times but also opens new avenues for fractional ownership and programmable finance. Meanwhile, tools like MCP Server-which embeds AI interfaces into trading workflows-and OmniSub, a sub-accounting platform that streamlines back-office operations, further cement Alpaca's position as a one-stop infrastructure provider for modern financial institutions.

Valuation Drivers: A B2B2C Flywheel in Motion

Alpaca's valuation is not a speculative bet but a reflection of its robust unit economics and diversified revenue streams. The company generates income through payment for order flow, commission fees, margin interest, and API usage fees creating a multi-pronged monetization model. Its B2B2C business model is particularly compelling: enterprise clients pay annual and per-transaction fees, while Alpaca also earns revenue from the activities of end users. This dual-income structure creates a flywheel effect, where growth in partners directly translates to user acquisition and transaction volume.

A critical enabler of this model is Alpaca's self-clearing infrastructure, which vertically integrates clearing and custody functions. By eliminating intermediaries, Alpaca improves margins while offering partners competitive pricing. This vertical integration also enhances data visibility and operational efficiency, critical advantages in a sector where speed and reliability are paramount.

Strategic Implications: A New Era for Capital Markets

Alpaca's rise signals a broader trend: the decentralization of financial infrastructure. Traditional capital markets, long dominated by legacy custodians and clearinghouses, are being disrupted by platforms that democratize access to trading, custody, and settlement. Alpaca's multi-leg options trading and fixed-income access capabilities are already challenging the status quo, enabling smaller institutions to offer sophisticated products without the overhead of legacy systems.