I had the pleasure of helping to build a venture that rode that wave of disruption (Aregon, which was acquired by Misys after a merger with Kapiti).
For 30 years after that, there was more of the same (faster, cheaper & smarter algos, but the paradigm of big trading floors run by big banks did not change).
Then came day traders powered by e-brokers. Then the day traders got whacked by High Frequency Trading (you cannot beat a machine in a speed contest). Now we are seeing an explosion of Fintech startups in what I call Low Cost Active Alpha. These are increasingly sophisticated tools that enable the inner Hedge Fund tycoon that lurks inside many people to:
- Beat the HFT machines through more sophisticated analysis
- Beat the big Funds by focussing on market areas which they serve badly (e.g small cap).
- Amplify returns by making fees from those who want to passively follow the star traders.
All of that needs fast, reliable market data. Delivering fast, reliable market data to hundreds of traders across a private LAN in a single large trading floor took some tech innovation 30 years ago. Delivering fast, reliable market data over a public WAN called the Internet, with intermittent and variable speed connection, to millions of traders in small offices on laptops and smartphone takes some tech innovation now. That is what Xignite does.
Xignite is part of the Programmable Bank space. For example, an entrepreneur or Bank might create a mashup using Xignite for market data and Yodlee for customer bank data access and Lending Club for lending assets.
HQ: Silicon Valley
Capital raised: $16.4m
CEO: Stephane Dubois
I have one question for Xignite – why is cross border investing so hard? I suspect that this is a data problem. If so, Xignite should be able to help.
Source: Bank Innovation