JPMorgan Chase buys information platform for startups in push to serve enterprise capital buyers
Signage outdoors a Chase financial institution department in San Francisco, California, on Monday, July 12, 2021.
David Paul Morris | Bloomberg | Getty Pictures
JPMorgan Chase is buying a knowledge analytics supplier for startup buyers referred to as Aumni, CNBC is first to report.
The most important U.S. financial institution by property is shopping for the 5-year-old Utah-based firm as a part of a broader push to deepen relationships with enterprise capital buyers and their corporations, in keeping with Michael Elanjian, who leads JPMorgan’s digital personal markets efforts.
associated investing information
Whereas phrases of the deal weren’t disclosed, JPMorgan is paying roughly what the startup was valued for at its final fundraising in 2021, in keeping with a supply. Aumni was value $232 million after that spherical, in keeping with Pitchbook.
The deal is the most recent in a string of fintech acquisitions made beneath CEO Jamie Dimon. Since 2020, JPMorgan has purchased a half-dozen startups to bolster its capabilities in areas from funds to ESG investing. The corporate’s expertise investments have come beneath scrutiny not too long ago amid the financial institution’s rising bills and an acrimonious legal dispute over a 2021 acquisition.
Disrupting Excel
JPMorgan determined to purchase Aumni after main its 2021 funding spherical, mentioned Elanjian. Based in 2018 by Tony Lewis, a former company lawyer, Aumni is a knowledge platform that helps customers analyze and perceive their holdings through a easy dashboard.
Many of the VC trade nonetheless makes use of Microsoft Excel or related merchandise to trace investments in portfolio corporations, which may make gleaning insights into their holdings tough, mentioned Lewis. That is as a result of contracts underpinning a single fairness spherical can exceed 600 pages of dense authorized writing, he mentioned.
“The second you need to begin performing any kind of knowledge science inquiries into your present funding exercise, it turns into a very giant endeavor to trace down that info precisely, put it into Excel and carry out the work,” Lewis instructed CNBC over Zoom.
“It is a drawback for anybody investing in any personal different asset; it’s based mostly on a non-public contract, that is the place your economics and authorized rights reside,” he added.
SVB collapse
Buyers leaned on Aumni in latest weeks after the collapse of Silicon Valley Bank despatched shock waves by way of the startup group, in keeping with Lewis. Because of worries over uninsured deposits at midsized banks, VCs out of the blue needed to know the place their portfolio corporations banked, and whether or not they had authorized rights to examine their monetary books, he mentioned.
In different cases, VC buyers can use Aumni to keep away from errors tied to lacking key particulars buried in authorized paperwork.
The startup has information on virtually 18,000 portfolio corporations valued at $3.6 trillion, Lewis mentioned. It fees an annual subscription price based mostly on property beneath administration and the variety of corporations tracked, he mentioned.
The service will likely be built-in with JPMorgan’s personal markets platform, Capital Connect, which got here out of stealth mode final yr, mentioned Elanjian. It additionally enhances the financial institution’s acquisition last year of International Shares, a software program supplier for managing worker inventory plans.
The broader aim is to grow to be the digital vacation spot for VCs, startup founders and different buyers to boost cash, community and faucet loans, he mentioned. Capital Join now has 200 staff and about 850 shoppers, he mentioned.
“We need to be the end-to-end ecosystem supplier to the enterprise group and the personal markets,” mentioned Elanjian.
