WeMatch: Why We Invested
Capital markets: an overlooked area of fintech where innovation becomes mandatory
For the past couple of years, every segment of fintech has been impacted by technology, with opportunities for disruption and competitive advantage becoming far easier to leverage. Capital markets has been somewhat shielded however, with higher barriers to entry which has made disruption by new entrants and external providers less likely. As a result, innovation has lagged far behind, and the sector has overall attracted — relatively to other fintech verticals — little VC investment.
Over time however, financial institutions have come to realise that innovation is no longer an option, but an absolute imperative for them to survive and thrive in the future. In the current challenging environment, banks need to reduce their cost base and focus on freeing up capital, while maintaining service standards and competitive advantage. As a result, we see the landscape evolving rapidly as firms are seeking to accelerate the introduction of digital and automated services that will enable them to maintain pace and leadership in a competitive environment. This trend has most certainly been accelerated by Covid.
Collaboration is the way forward - the value is in the ecosystem enabling liquidity
The concept of partnerships between financial institutions and fintechs, and between financial institutions themselves has already taken off. Banks are demonstrating that they also have the collaboration gene. In capital markets (especially in the trading space), we see this as an absolute imperative to build a solid ecosystem especially as liquidity is the name of the game. Newcomers in the space that are able to drive volume (and therefore trading opportunities and liquidity) while improving trading efficiency will be tomorrow’s winners.
Announcing our investment in WeMatch, a web-based matching and negotiation tool across multiple asset classes
Enter WeMatch, who are shaking up the market, bringing various industry participants on one platform and applying robust technology to do so. WeMatch helps traders find liquidity, negotiate, trade, optimise and manage the lifecycle of their portfolios of assets and trade structures. Their platform helps financial institutions transition liquidity from a market that has traditionally been served via voice broking (ie. OTC market) to an orderly electronic service, improving productivity, de-risking the overall trading process while operating at a fraction of the costs of conventional Inter-Dealer Brokers (IDBs).
WeMatch serves 30+ of the world’s largest financial institutions on multiple asset classes, namely: interest rate swaps, securities financing and equity derivatives. They enable traders both in EMEA and the US, where they went live in late 2020.
The company has a very strong team in place, composed of seasoned industry professionals. We are delighted to be supporting Joseph Seroussi (Co-Founder & CEO), David Raccat (Co-Founder & Head of EMEA) and the wider team in their next phase of growth.
We are excited to join WeMatch’s $19.4 million Series B, led by DB1 Ventures, the corporate venture arm of Deutsche Börse, with participation of Illuminate Financial as well as existing investor JP Morgan.
Learn more about investing in fintech with Augmentum here.
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