Five Companies Shaping The Future Of Primary Markets
The primary markets are rich with opportunity.
Innovative companies are looking to take advantage by applying technology to deal flow. At Origin, we’re connecting issuers with dealers in order to optimise primary markets and offer a robust platform for all debt capital markets counterparties to come together.
We’re joined by several other companies, each exploiting different technologies to solve concrete problems for dealers, issuers and investors. Here’s a selection of our contemporaries who are shaping the future of the capital markets in their own way.
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In its own words: “The capital markets operating system”.
Luxembourg-based EPPF (or the European Private Placement Facility) is solving the challenges posed by the traditional fixed income model. The EPPF platform offers low-volume borrowers the same functionality, efficiency and low costs currently available to large issuers.
Their platform is transnational, doing away with cross-border documentation and settlement. By standardising and automating steps in the issue process, EPPF slashes transactional costs by up to 80%. It’s also speeding up the process, reducing completion from months to weeks.
As EPPF surmise, “The fixed income space is the last bastion of slow and manual processes and a patchwork of partial solutions.” That’s the problem we’re all trying to fix.
It’s an exciting time for EPPF. Having announced their first €1m issue in December last year, we expect big things from them as they continue to grow throughout 2018.
In its own words: “A marketplace for debt capital issuances”.
CredX offers an alternative to deals executed by banks, working as a neutral intermediary, enabling private placements of all forms of credit, from bonds, to promissory notes, to loans. Their users can initiate, negotiate and close issues and loan applications, all on one platform.
It offers an option to all debt market participants, providing access for industry, SMEs and public sector issuers seeking debt finance of all type and size. The CredX platform connects treasurers and FOs with investors and issuers, reducing inefficiencies and costs.
Only recently launched, the CredX platform has already helped Deutsche Telekom issue a €50m promissory note loan. Expect to see more.
In its own words: “An independent money and capital market platform for public-sector borrowers and institutional investors.”
Cologne-based Loanboox has quickly established itself in Switzerland and Germany and is fast looking to make a name for itself across Europe, too.
Founded in 2016, Loanboox offers a digital platform for the debt financing of public projects, connecting investors with those seeking credit. They promise to drop the tendering process time by up to 90%, with a large reduction in commission, too.
Loanboox is live in Germany and Switzerland and the volume of loans on their platform totals billions of Swiss Francs. It plans to be Europe-wide by end of 2019.
In its own words: “Powering the networks that connect capital to ideas.”
Compared to others, Ipreo is a veteran, with a history stretching back to the 1980s and products spanning all sectors of the capital markets. In DCM, Ipreo offers a platform helping dealers manage the syndication and book-building process for large public transactions. They’ve boldly gone one step further with Investor Access, opening up a portal for investors to input their orders directly.
Its HQ is in New York, but with a worldwide staff of over 1,700, Ipreo is a mighty incumbent in markets electronification, offering scale and efficiencies to those looking to raise money.
It may be private-equity backed by Blackstone and Goldman Sachs, but Ipreo behaves like a startup, remaining agile and employing tech to streamline process and reduce cost throughout the capital market deal flow.
Sure, they’ve been around a while and in a time of great change in the capital markets, incumbents may feel under threat. But given their track record for adapting and changing how we use the capital markets, expect Ipreo to be blazing a trail for years to come.
In its own words: “Making financial services invisible”.
London-based Nivaura has developed an Ethereum-based blockchain service that makes raising debt smoother, more transparent, secure and lower cost.
Right now, Nivaura offers automated bond issuance in cryptocurrencies on a public blockchain platform. Over time, their intention is to reduce the need for dealers. As a result, the costs associated with regulatory clearances will fall, too.
Nivaura was the first company invited to work in Fuse, Allen & Overy’s tech innovation sandbox, as well as being one of the companies invited to test inside the FCA’s regulatory sandbox, too.
The capital markets are still searching for how to efficiently integrate crypto and blockchain technology. Nivaura’s solution looks to be a first significant step.
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These are exciting times for those shaping the future of the capital markets. Companies Europe-wide are taking different approaches, searching for the best way to employ technology.
There is no ‘perfect’ solution. At Origin, we are developing our own approach, grounded in working with dealers in order to affect positive change to deal flow at scale. We’re connecting dealers and issuers through technology, in the belief that banks will continue to be ranked by their institutional commitment to clients. We believe that human qualities of trust, loyalty and creative thinking are central to deal origination, and we’re building our platform with that in mind.
It’s exciting to see other companies tackling the problems of inefficiency, cost and scale in a range of innovative ways. We’re excited to be part of this group. Together, the future looks bright.