OpenGamma Completes Second Round of Financing

18 January 2011 By Kirk Wylie In News

Today, I'm pleased to announce that in December 2010, OpenGamma closed its second round of funding: a Series B investment led by FirstMark Capital, based in New York City.

While there's been a lot of press coming out this week, including our joint press release with FirstMark, I wanted to give a little more color into why we raised this round, what we're going to do with the additional financing, and why we're so excited to be working with FirstMark for the next phase in OpenGamma's life.

When we raised our first round of funding with Accel in August, 2009, our initial goal was to build the best, and hopefully last, platform for performing and managing the computations so key to all modern finance. Due to the sheer breadth of what we were attempting to build, we knew that this would take quite some time to get to what startup veterans are now calling the Minimum Viable Product. Hence, we went dark to build it.

When we finally launched our first real website and told the world what we were doing in July of 2010, we immediately had a flood of interest from people interested in the OpenGamma Platform and what it could do for them. We started working with the first customers in our Early Adopter Program, refined the system, expanded what it was capable of, and put it in the hands of real traders and risk managers. What these users were telling us was clear: they wanted to aggressively exploit what we had built beyond our initial expectations, and we needed to grow to support their needs.

That led to two requirements:

1. We needed additional capital to make sure that every developer and end-user of OpenGamma technologies was as successful as they could possibly be; and
2. We needed to expand our geographical footprint to satisfy the inherently global nature of our customer base.

London and New York are, while competing for the title of financial capital of the world, almost better thought of as sister cities. We speak the same language, we share similar legal and regulatory structures, and we're actually almost the same distance from each other as New York is from Los Angeles. In fact, while I never really went to New York when I lived in San Francisco, as soon as I moved to London and started working in finance I was flying over to Manhattan on an extremely regular basis. So it was pretty obvious that we would need a presence in New York before long.

But just as much as the general similarities and sympathies the two cities have (they don't call it NyLon for nothing), customers were telling us they needed us to have a presence in New York. Many large American and European banks split their senior management between the two cities; many hedge funds have desks in London (or Switzerland) and New York (or Connecticut). People were telling us they needed to make sure that OpenGamma was able to support them no matter what side of the pond their developers, traders, and risk managers were located.

So once we had decided that we needed capital, and needed to open a New York office, the next logical step was to raise that capital from a source that understood our business, and had a deep and strong connection with New York City.

We found that source in Lawrence Lenihan from FirstMark Capital.

Lawrence brings to the OpenGamma board a wealth of experience in technology investing, and a fantastic understanding of the financial services industry and how revolutionary, disruptive technology like OpenGamma can change and improve how the industry operates. His strong connection to New York City, its people and industries, can only benefit us as we expand out of our London home (which will remain our global headquarters).

We'll be putting FirstMark's (and Accel's, who continued their participation in this round) money to hard work. We're building out our commercial operations team (so that we have the capacity to actively educate the market and support customers and users), we're opening a New York City office (to make sure that we can support customers in both of the world's twin financial services capitals), we're continuing our investment in research and development (to make sure the OpenGamma Platform continues to develop into the single best system you can base your risk and analytics infrastructure on). In short, we've got our work cut out for us, but with FirstMark and Accel behind us, I'm confident we'll succeed in our mission of changing the way people deliver analytics to financial services users.

I'm extremely excited about OpenGamma turning this corner in our history, and I look forward to sharing more as we open our office, continue our Early Adopter installations, and do our first Open Source release later this year!