From the front-office to the back-office, a crop of new capital markets tech companies are looking to digitize traditional financial services operations.

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The transformation of capital markets technology has been underway for over a decade, but adoption among incumbents has been slow. A new wave of entrants has been gaining traction with investors and set a record in 2016 with 216 deals worth approximately $1.89B. Armed with private funding, this set of companies is leveraging technology with the aim of automating, digitizing, and creating access to global capital markets.

Using CB Insights data, we identified over 145 companies in the capital markets tech space providing software and/or services for investment banks, hedge funds, investment managers, and so forth. We organized the companies into 3 main categories based on the traditional area of the business model they are attacking (front-office, middle-office, or back-office). We then categorized them across 15 different subcategories based on the software and services they offer to address pain points for financial services professionals.

We included companies in our map based on recency of funding, quality of investors, and Mosaic score — CB Insights’ proprietary algorithm that uses financial and non-financial signals to predict private company health.

Research Briefing: Capital Market Trends
Join us as we cover the crop of capital market tech companies and address the pain points they are addressing for financial services firms and more.

We define capital markets tech broadly to include software and technology companies that are augmenting or replacing established business processes for financial institutions, including securities issuance, trading, clearance & settlement, and companies creating alternative solutions leveraging newer technology including AI, machine learning, and blockchain.

This category excludes payments, lending, and credit monitoring.

Please click on the map to enlarge. The map is not meant to be exhaustive of companies in the space and more companies can be found in the Collection link below

Capital Markets Tech Market MapThe breakdown is as follows:

Front-Office

This category covers the front-office or customer-facing areas of the business including sales, trading, and research. This includes marketplaces and platforms that create access to primary and secondary markets, alternative exchanges to buy and sell assets, and general software that supports the sales and trading desk.

  • Exchange / Trading Platform: These companies offer alternative exchanges or trading platforms for institutional investors for asset classes including stocks, bonds, ETFs, foreign exchange (forex), derivatives, and more. This includes IEX, an equity trading platform owned and operated independently of a major exchange and Trumid, an electronic bond trading platform.
  • Portfolio ManagementThis is a broad subcategory of software that supports traders and investment advisors with tools that automate, digitize, and centralize portfolio and investment management workflows. This includes Opera Solutions, a company that provides investment recommendations while leveraging machine learning to conduct on-going portfolio performance updates and surveillance and Archer, a cloud-based investment management platform for institutional, retail, and private wealth managers, is also part of this subcategory.
  • Hedge Fund TechThese companies are leveraging technology to build alternative platforms for hedge fund and high-frequency trading. This subcategory includes Clearpool Group, a developer of electronic trading software that supports hedge funds.

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Middle-Office

This category covers the middle-office, or support function, and includes investment risk, research, and analytics platforms.

  • Alternative DataCompanies in this space provide investors with alternative access to data and non-traditional data sets that aim to complement or replace legacy data providers. This includes startups that are leveraging sentiment analysis like iSentium and companies that provide customer behavioral data such as Earnix.
  • Business Intelligence: This subcategory includes companies that provide investors and advisors with tools to make strategic investment decisions. Companies include Addepar, which provides software to unify investment management and aggregates clients’ investment portfolios. It also includes MX, a centralized application that draws and cleanses disparate data sets from across platforms.
  • Market Data Platforms: Companies in this subcategory collect unstructured data sets and provide investors with a platform to access market data, analytics, and conduct research. This includes AlphaSense, a platform that collects exchange rates, inflation data, and more. It also includes Xignite, a cloud-based marketplace for financial market data APIs.

Back-Office

This category covers the back-office or administrative functions and includes clearance & settlement, risk & compliance, and information technology broadly. Startups in this space help firms with post-trade clearance & settlement, regulatory compliance and risk mitigation, and general operations.

  • AML / KYC: This includes companies that address anti-money laundering (AML) requirements, which prevent banks from being used, intentionally or unintentionally, by criminal elements for money laundering activities. Know Your Customer (KYC) tools help verify the identity of clients or personnel and are relied on by firms to conduct continuous monitoring and due diligence. Companies in this subcategory include Digital Reasoning Systems and Fenergo.
  • Cap table managementThis subcategory of companies is replacing a core administrative function of the back office — recordkeeping. This includes startups like eShares, which is creating and managing digital stock certificates, a historically manual process.
  • Chatbots / Virtual assistantsCompanies in this subcategory are leveraging AI to expedite or replace customer help desks, which includes the use of chat bots and personal assistant applications. Personetics Technologies, a personal assistant that uses predictive interaction to help financial services firms personalize the customer experience, is a notable company in the space.
  • Clearance & Settlement: These companies are leveraging technology to disrupt existing clearance firms and innovate on the established settlement process. This includes ClearBank, a digital-first clearing bank, and Finxact, an enterprise software provider that provides core infrastructure built on the cloud. This also includes companies developing computational computing technologies, which have known applications in financial services, but have not yet been widely adopted. D-Wave Systems, a quantum computing developer, is a company in this subcategory.
  • Clearance & Settlement-Blockchain: These companies are providing clearance & settlement for digital currencies and/or leveraging blockchain technologies to enhance core clearance & settlement including Digital Asset Holdings.
  • Communication tools: This set of companies helps financial firms communicate securely both internally and externally with other firms. Notable startups include Symphony Communication Services Holdings and Cloud9 Technologies.
  • Financial Services Software: This is a broad subcategory of companies that provide software for financial services firms to enhance existing products or introduce new ones. Startups include Plaid Technologies, a software intermediary that helps banks adopt a mobile strategy as well as InvestCloud, a cloud application developer that builds and deploys applications for asset managers, fund of funds, and investment advisors.
  • Monitoring: This subcategory includes companies providing software that monitors employees, analyzes customer interactions, and/or identifies actionable anomalies for financial institutions. Droit Fintech, an over-the-counter (OTC) derivative trading platform that facilitates compliance with applicable global regulations and Bigstream Solutions, a data analytics platform that leverages machine learning to analyze user behaviors to proactively identify misconduct, are two companies in the space.
  • Risk & Compliance: These companies are providing software that identifies and mitigates broader risk management and helps firms meet compliance requirements. This includes Riskalyze, software that aids advisors in measuring client risk tolerance thresholds and nCino, a bank operating software that provides a suite of portfolio risk management services.

See the full list of startups below:

Capital Markets Tech Market Map
Company Category Select Investors
Front-Office
Artivest Holdings Exchange / Trading Platform 500 Startups, Deep Fork Capital, FinTech Collective, Red Swan Ventures, RRE Ventures
AX Trading Group Exchange / Trading Platform Undisclosed Investors
Global Liquid Markets Exchange / Trading Platform Otter Capital, Sutter Hill Ventures
Halo Investing  Exchange / Trading Platform Undisclosed Investors
IEX Group Exchange / Trading Platform Bain Capital Ventures, Franklin Templeton Investments, MassMutual Ventures, Spark Capital, Sapphire Ventures
Kantox Exchange / Trading Platform Cabiedes & Partners, Carlos Blanco, Francois Derbaix, Fxstreet, IDInvest Partners, Juan Margenat, Lanzame Capital
Mercatus Exchange / Trading Platform Augment Ventures, TPG Alternative & Renewable Technologies, Traverse Venture Partners, Trepp, Vision Ridge Partners
OpenDoor Trading Exchange / Trading Platform Hartfield, Titus & Donnelly, John Brynjolfsson
Orchard Platform Exchange / Trading Platform Spark Capital, Thrive Capital, Canaan Partners, Conversion Capital, Nyca Partners, QED Investors, Thomvest Ventures, Victory Park Capital
Spark Systems Exchange / Trading Platform Undisclosed Investors
TradAir Exchange / Trading Platform Carmel Ventures, Genesis Partners, Long Ridge Equity Partners
Trumid Exchange / Trading Platform CreditEase, SenaHill Partners, Shumway Capital, Soros Fund Management, Thiel Capital
Alphaclone Hedge Fund Technology Operative Capital
Potamus Trading Hedge Fund Technology Undisclosed Investors
Clearpool Group Hedge Fund Technology Edison Partners
Omega Point Hedge Fund Technology Liberty City Ventures
55 Capital Portfolio Management Calibrate Partners, Point72 Ventures, Tectonic Ventures
Additiv Portfolio Management BZ Bank Aktiengesellschaft
Archer Portfolio Management NewSpring Holdings
Bridge Financial Technology Portfolio Management SixThirty
CAIS Portfolio Management Square Peg Capital
Confluent Portfolio Management Benchmark, Data Collective, Index Ventures, LinkedIn, Sequoia Capital
Enfusion Portfolio Management FTV Capital
InvestEdge Portfolio Management Innovation Works, Vistara Capital Partners
Jacobi Portfolio Management Undisclosed Investors
METIS Portfolio Management Undisclosed Investors
Nirvana Financial Solutions Portfolio Management Mosaix Ventures
Opera Solutions Portfolio Management Accel-KKR, Enlightenment Capital, Invus Group, JGE Capital Management, Silver Lake Partners, Tola Capital, Wipro
Quovo Portfolio Management Continuity Capital, F-Prime Capital, FinTech Collective, Long Light Capital
Wealth Access Portfolio Management Cultivation Capital, SixThirty
Zichan360 Portfolio Management SIG Asia Investments, Source Code Capital
Middle-Office
7Park Data Alternative Data Mueller Ventures, NYU Future Labs
Accern Alternative Data 26 Ventures, Affinity Investment Group, Belmont Capital, Gurtin Ventures, Rostra Capital
Airex Alternative Data SenaHill Partners
Alpaca Alternative Data Archetype Ventures, Bip Systems, D4V, Mitsubishi UFJ Capital, Monex Ventures, NEC Capital Solutions, SMBC Venture Capital
BISON Alternative Data Accomplice,  GrandBanks Capital and Hamilton Lane Advisors
Dataminr Alternative Data Goldman Sachs, Credit Suisse NEXT Investors, Fidelity Investments, Glynn Capital Management, Institutional Venture Partners, Venrock, Wellington Management, WorldQuant Ventures, Deep Fork Capital, GSV Capital
Eagle Alpha Alternative Data Enterprise Ireland, Quay Investments, Roberto Hoornweg, Rosland Kilduff
Earnest Research  Alternative Data ff Venture Capital, Greycroft Partners, Osage Venture Partners, Rincon Venture Partners
Earnix Alternative Data Formula Ventures, Israel Growth Partners, Jerusalem Venture Partners, Plenus Venture Lending, Vintage Investment Partners
Estimize Alternative Data Agilic Capital, Contour Venture Partners, Frank Sica, Longworth Venture Partners, and WorldQuant Ventures
InvestiQuant Alternative Data Undisclosed Investors
iSentium Alternative Data Angel Investors
Predata Alternative Data Chicago Ventures, Conversion Capital, Edison Partners
Quandl Alternative Data August Capital, Nexus Venture Partners
Selerity Alternative Data Citi Growth Ventures & Innovation Group, and Angel Investors
SmartKarma Alternative Data  Jungle Ventures and Wavemaker Partners
StockTwits Alternative Data Foundry Group, Social Leverage, True Ventures, Betaworks
Street Contxt Alternative Data Formation 8, iNovia Capital, Joe Lonsdale, Palm Drive Capital, Point72 Ventures, Portag3 Ventures, Social Leverage
Thinknum Alternative Data 500 Startups, 645 Ventures, Green Visor Capital, Pear, Signature Capital
Second Measure Alternative Data Bessemer Venture Partners, FundersClub, Norwest Venture Partners, Shasta Ventures
TrackInsight Alternative Data Aviva France Impact Investing, NewAlpha
Yipitdata Alternative Data  Gotham Ventures, Highland Capital Partners, IA Ventures, RRE Ventures
Addepar Business Intelligence 8VC, Anduin Ventures, Blumberg Capital, ff Venture Capital, Sway Ventures, Valor Equity Partners
Alight Business Intelligence Undisclosed Investors
Canalyst Business Intelligence Vanedge Capital
ChartIQ Business Intelligence FinTech Innovation Lab, Illuminate Financial Management, Social Leverage, Tribeca Angels, ValueStream
Dingfudata Business Intelligence Lingfeng Capital
EidoSearch Business Intelligence FinTech Innovation Lab
FI Navigator  Business Intelligence Undisclosed Investors
Lucena Research Business Intelligence Flashpoint
MX Business Intelligence Commerce Ventures, DG Incubation, Fraser Bullock, Greg Warnock, Josh James, Nobutaka Mutaguchi, North Hill Ventures, Peak Ventures
Q4 Business Intelligence Accomplice, Emerillon Capital, HarbourVest Partners, Information Venture Partners, Kensington Capital Partners, OpenText Enterprise Apps Fund, Plaza Ventures, Silicon Valley Bank
Random Forest Capital Business Intelligence Undisclosed Investors
RavenPack Business Intelligence Draper Esprit
Visible Alpha Business Intelligence Bank of America Merril Lynch, Citigroup, Jefferies & Company, Morgan Stanley, UBS
AlphaSense Market Data Platform First Fellow Partners, Quantum Strategic Partners, Soros Fund Management, Tom Glocer, Triangle Peak Partners, Tribeca Venture Partners, Vendep Startup Fund
AltX Market Data Platform Cowen Group, Addepar, Wells Fargo & Company
Kensho Technologies Market Data Platform Accel Partners,  New Enterprise Associates, Work-Bench, General Catalyst, Bank of America Merril Lynch, Breyer Capital, Citigroup, F-Prime Capital, Goldman Sachs, Google Ventures, J.P. Morgan Chase & Co., Morgan Stanley, NBCUniversal, Promus Ventures, S&P Global, Wells Fargo & Company
Powerlytics Market Data Platform CME Ventures, Delaware Crossing Investment Group
Xignite Market Data Platform Altos Ventures, Startup Capital Ventures, StarVest Partners
Zirra Market Data Platform AOL Ventures and Angel Investors
Back-Office
Cognito AML/KYC Battery Ventures, Digital Currency Group, Khosla Ventures, Lightspeed Venture Partners, New Atlantic Ventures
ComplyAdvantage AML/KYC Balderton Capital
Contego Fraud Solutions AML/KYC FinTech Innovation Lab and Angel Investors
Digital Reasoning Systems AML/KYC Credit Suisse NEXT Investors, FinTech Innovation Lab, Goldman Sachs, Health Evolution Partners, Health Insight Capital, In-Q-Tel, Lemhi Ventures, NASDAQ, Nashville Capital Network, Silver Lake Partners
Encompass AML/KYC Adcock Private Equity, Scottish Investment Bank
Enigma Technologies AML/KYC New Enterprise Associates, American Express Ventures, Comcast Ventures, Crosslink Capital, Two Sigma Ventures
Fenergo AML/KYC Insight Venture Partners, Investec Ventures, Aquiline Capital Partners
Fortress Risk Management  AML/KYC Axiom Venture Partners, Sorenson Capital, Advantage Capital Partners, Black Dragon Capital, State of Connecticut
Onfido AML/KYC Salesforce Ventures, Spencer Hyman, Talis Capital, Wellington Partners, IDInvest Partners
Quantexa AML/KYC Albion Ventures and HSBC Venture Capital
Trunomi AML/KYC Fenway Summer Ventures, Fintonia Group, Persistent Venture Fund, Plug and Play Accelerator, Saturn Partners, SenaHill Partners, WorldQuant Ventures
Verafin AML/KYC Information Venture Partners, Spectrum Equity Investors
Capshare Cap Table Management Draper Associates, Jeremy Andrus, Jeron Paul, Kickstart Seed Fund, Otter Rock Capital, Standish Management
eShares Cap Table Management Industry Ventures, Spark Capital, Subtraction Capital, Union Square Ventures
Global Shares Cap Table Management Angel Investors
Active.ai Chat Bot / Virtual Assistant IDG Ventures India, Kalaari Capital, Kstart, Microsoft Accelerator
Avaamo Chat Bot / Virtual Assistant Eleven Two Capital, OVO Fund, Rembrandt Venture Partners, Streamlined Ventures, WI Harper Group
Kasisto Chat Bot / Virtual Assistant AlphaPrime Ventures, Commerce Ventures, Cristobal Conde, DBS Bank.MasterCard Worldwide, Propel Venture Partners, Two Sigma Ventures
Personetics Technologies Chat Bot / Virtual Assistant Carmel Ventures, Lightspeed Venture Partners, Santander InnoVentures, Sequoia Capital Israel
Broadway Technology Clearance & Settlement Long Ridge Equity Partners
Celerix Technologies Clearance & Settlement Bitkemy Ventures
ClearBank Clearance & Settlement PPF Group and Angel Investors
Delta Data Software Clearance & Settlement Accel-KKR
D-Wave Systems Clearance & Settlement BDC Venture Capital, Draper Fisher Jurvetson, Harris & Harris Group and Vanedge Capital, Fidelity Investments, Goldman Sachs, GrowthWorks, In-Q-Tel
Finxact Clearance & Settlement Live Oak Ventures
PeerNova Clearance & Settlement Blockchain Capital, Mosaik Partners, Zhejiang Zhongnan Holdings Group
Axoni Clearance & Settlement – Blockchain Andreessen Horowitz, Citigroup, Data Collective, Digital Currency Group, Euclid Opportunities, F-Prime Capital, FinTech Collective, Goldman Sachs, J.P. Morgan Chase & Co., NEX Group, Thomson Reuters, Wells Fargo & Company
Cambridge Blockchain Clearance & Settlement – Blockchain BBVA Open Talent, Digital Currency Group, FinTech Innovation Lab, Partech Ventures, Santander InnoVentures, PSP Investments
Digital Asset Holdings Clearance & Settlement – Blockchain ABN AMRO Bank, Accenture, Australian Securities Exchange, BNP Paribas Private Equity, Broadridge Financial Solutions, Citigroup, CME Group, Deutsche Boerse, Goldman Sachs, IBM, J.P. Morgan Chase & Co., NEX Group, PNC Financial Services Group, Santander InnoVentures and The Depository Trust & Clearing Corporation
Juzhen Financials Clearance & Settlement – Blockchain StatPro
Paxos Clearance & Settlement – Blockchain RRE Ventures, Canaan Partners, Digital Currency Group, Blockchain Capital, Liberty City Ventures
Ripple Labs Clearance & Settlement – Blockchain Andreessen Horowitz, Lightspeed Venture Partners, RRE Ventures, Google Ventures, IDG Capital, AME Cloud Ventures, Blockchain Capital, CME Ventures, Venture51
SolidX Partners Clearance & Settlement – Blockchain Jim Pallotta, Liberty City Ventures, Red Sea Ventures, Red Swan Ventures, Stanley Shopkorn
Cloud9 Technologies Communication Software Barclays Bank, J.P. Morgan Chase & Co., NEX Group, Point72 Ventures
MindLink Communication Software Undisclosed Investors
Symphony Communication Services Holdings Communication Software Bank of America Merril Lynch, BlackRock, BNP Paribas, BNY Mellon, Citadel Group, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, Google, J.P. Morgan Chase & Co., Jefferies & Company, Lakestar, Maverick Capital, Merus Capital, Morgan Stanley, Natixis, Nomura Holdings, Societe Generale Group , UBS, Wells Fargo & Company
DealCloud Financial Services Software Cultivation Capital, Falfurrias Capital Partners, Hamilton Lane Advisors, Holekamp Ventures, Holton Capital
InvestCloud Financial Services Software Altos Ventures, FTV Capital, J.P. Morgan Chase & Co., Polaris Capital Management
Meniga Financial Services Software Crealogix, Frumtak Ventures, Industrifonden, Kjolfesta, Velocity Capital Private Equity
OpenFin Financial Services Software  Bain Capital Ventures, DRW Venture Partners, Euclid Opportunities, J.P. Morgan Chase & Co., Nyca Partners, Pivot Investment Partners
Plaid Technologies Financial Services Software New Enterprise Associates, Spark Capital, Goldman Sachs, Google Ventures, Homebrew, American Express Ventures, Citi Ventures
Starburst Labs Financial Services Software Bel45 Capital Partners
Tradier Financial Services Software F-Prime Capital
UiPath Financial Services Software Accel Partners, Credo Ventures, Earlybird Venture Capital
Ascent Technologies Monitoring Undisclosed Investors
Bigstream Solutions Monitoring Cota Capital, Oriza Ventures, Streamlined Ventures
Chainalysis Monitoring Converge Venture Partners, Digital Currency Group, FundersClub, Point Nine Capital, Techstars Ventures
Coinfirm Monitoring Luma Investment, SEI Codify, Startup Collider by PwC
Compliance Science Monitoring Edison Partners
Droit Fintech Monitoring DRW Trading Group, Goldman Sachs, Illuminate Financial Management, Pivot Investment Partners, Wells Fargo & Company
Elliptic Monitoring Digital Currency Group, KRW Schindler Private Ventures, Octopus Ventures, Paladin Capital Group, Santander InnoVentures
Neurensic Monitoring Plug and Play Accelerator
OpenGamma Monitoring  Accel Partners, Cristobal Conde, Euclid Opportunities, FirstMark Capital, Illuminate Financial Management, Japan Exchange Group, NEX Group
Qumram Monitoring Alma Mundi Ventures, Zirkonia
Solovis Monitoring Cultivation Capital, Edison Partners, Jeremie Bacon, MissionOG, Northwestern University, OCA Ventures, Timberline Venture Partners
AQMetrics Risk & Compliance Bluff Point Associates, Enterprise Ireland, Frontline Ventures
Argos Risk Risk & Compliance Undisclosed Investors
Ayasdi Risk & Compliance Floodgate, Institutional Venture Partners, Khosla Ventures, Kleiner Perkins Caufield & Byers, Apogee Venture Group, Centerview Capital, Citi Ventures, GE Ventures
Capital Confirmation Risk & Compliance Great Hill Partners
Certent Risk & Compliance Bridge Capital Holdings, K1 Capital
Corlytics Risk & Compliance Infinity Capital, Kernel Capital
Credit Benchmark Risk & Compliance Balderton Capital, Index Ventures
CreditPoint Software Risk & Compliance i2E
FINCAD Risk & Compliance Wellington Financial
Finomial Risk & Compliance Bridgescale Partners
Governance.io Risk & Compliance Banque Internationale a Luxembourg, European Investment Bank
INTIX Risk & Compliance Michel Akkermans
Kyriba Risk & Compliance  Upfront Ventures, BRED Banque Populaire, Mitsubishi UFJ Capital, American Express, HSBC Venture Capital
Limina Risk & Compliance Mats Berglund, Pontus Braunerhjelm
LMRKTS Risk & Compliance FinTech Innovation Lab, Motive Partners
Merlon Intelligence Risk & Compliance Data Collective, Fenway Summer Ventures, Nyca Partners, Promus Ventures, Temerity Capital, Work-Bench
nCino Risk & Compliance Insight Venture Partners, Salesforce Ventures, Wellington Management, and Angel Investors
NetGuardians  Risk & Compliance Freemont Management, Swisscom Ventures
Plia Systems Risk & Compliance Undisclosed Investors
Regnosys Risk & Compliance Undisclosed Investors
Riskalyze Risk & Compliance FTV Capital
Rsam Risk & Compliance JMI Equity
Token Risk & Compliance Digital Currency Group, EQT Ventures, Octopus Ventures, OP Financial Group

 

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