Signage exterior a Chase financial institution department in San Francisco, California, on Monday, July 12, 2021.
David Paul Morris | Bloomberg | Getty Photographs
JPMorgan Chase is buying an information analytics supplier for startup buyers known as Aumni, CNBC is first to report.
The most important U.S. financial institution by belongings 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 firms, in response to Michael Elanjian, who leads JPMorgan’s digital non-public markets efforts.
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 response to a supply. Aumni was price $232 million after that spherical, in response to Pitchbook.
The deal is the most recent in a string of fintech acquisitions made underneath 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 underneath scrutiny lately amid the financial institution’s rising bills and an acrimonious authorized 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 an information platform that helps customers analyze and perceive their holdings through a easy dashboard.
A lot of the VC trade nonetheless makes use of Microsoft Excel or comparable merchandise to trace investments in portfolio firms, which might 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 wish to begin performing any kind of information science inquiries into your present funding exercise, it turns into a very massive endeavor to trace down that data precisely, put it into Excel and carry out the work,” Lewis instructed CNBC over Zoom.
“This can be a downside for anybody investing in any non-public different asset; it’s primarily based 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 Financial institution despatched shock waves by means of the startup group, in response to Lewis. Resulting from worries over uninsured deposits at midsized banks, VCs immediately wished to know the place their portfolio firms 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.
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The startup has knowledge on virtually 18,000 portfolio firms valued at $3.6 trillion, Lewis mentioned. It prices an annual subscription charge primarily based on belongings underneath administration and the variety of firms tracked, he mentioned.
The service can be built-in with JPMorgan’s non-public markets platform, Capital Join, which got here out of stealth mode final 12 months, mentioned Elanjian. It additionally enhances the financial institution’s acquisition final 12 months of International Shares, a software program supplier for managing worker inventory plans.
The broader aim is to change into 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 workers and about 850 purchasers, he mentioned.
“We wish to be the end-to-end ecosystem supplier to the enterprise group and the non-public markets,” mentioned Elanjian.