by MGV Team
Nivaura poised for growth following $20m strategic seed investment round
Investors include Allen & Overy, Linklaters, London Stock Exchange Group, MiddleGame Ventures, Santander InnoVentures and Transamerica Ventures (a wholly owned Aegon subsidiary)
LONDON, UK – Feb 27, 2019 – Nivaura, a regulated FinTech company focused on automating the issuance and administration processes for financial instruments, has closed a strategic funding round, raising $20m in seed and seed extension capital from a number of prominent partners.
Founded three years ago, Nivaura’s focus is on the deployment of digital investment banking platforms for banks, exchanges and other financial institutions, to connect and automate fragmented and manual processes involved in the issuance and administration of instruments such as any form of bonds, loans, equity, and structured products. For certain transaction types, this can reduce time to market by as much as 60-80 per cent, cutting cost by orders of magnitude, and ensuring consistent compliance.
This $20m investment, led by London Stock Exchange Group, will allow Nivaura to rapidly expand its leadership, business development and technical teams in order to accelerate growth. Technical market professional hires will enable Nivaura to move faster to complete product development and to ramp up expertise across machine learning and natural language processing, in line with clients’ increasingly complex automation needs. The company also plans to enter new jurisdictions and to cover new asset classes.
As an early example of the senior hires to be joining Nivaura, Richard Cohen, a senior Debt Capital Markets lawyer, is moving from Allen & Overy as Nivaura’s General Counsel and Head of Strategy. Nivaura also welcomes two new board members. The first is investment banking veteran Spencer Lake, formerly Head of Global Markets and Vice Chairman of HSBC’s Banking and Markets Division, who is also joining as an investor and commercial advisor on business development to the team. The second is Nikhil Rathi, CEO of London Stock Exchange plc and Director of International Development, London Stock Exchange Group, which is also partnering with Nivaura to drive innovation across capital markets.
Nivaura has already successfully proven the platform for structuring, distributing, executing and settling financial instruments both traditionally by enabling settlement through existing clearing infrastructure, and as tokenized instruments that are registered and settled on public blockchains. One such success was the world’s first automated cryptocurrency denominated bond issuance supported by leading capital markets law firm Allen & Overy.
Nivaura’s CEO, Dr. Avtar Sehra, commented: “Our focus for 2019 is on conducting a series of high profile, large-scale projects with high calibre partners to demonstrate our platform as a valuable solution across the full spectrum of capital markets primary issuance activities. Working with such partners with their wealth of experience will underpin our next phase of growth.”
By working with major law firms such as Allen & Overy and Linklaters, in addition to participating in all of the first four FCA regulatory sandboxes, where it gained its MiFID and CASS regulatory approvals, Nivaura has made regulatory and legal rigour core to the platform. This compliance mindset is further reinforced by Linklaters and Orrick becoming investors in the latest seed round extension and Allen & Overy continuing with its support.
Dr. Sehra added: “We’re seeing growing appetite from major financial institutions for practical innovation that goes beyond buzzwords and conceptual PoCs in ‘digital investment banking’. Boards are saying: go forth and innovate. But doing so in the highly regulated and complex world of capital markets is immensely difficult. With our now proven approach and compliance credentials, we are able to finally help our industry take practical steps to innovate and improve their economics.”
List of key investors includes:
● Allen & Overy
● Digital Currency Group
● London Stock Exchange Group
● MiddleGame Ventures
● Santander InnoVentures
● Spencer Lake
● Transamerica Ventures (a wholly owned Aegon subsidiary)
Additional quotes – for select distribution
Spencer Lake, Board Member and former Vice Chairman of HSBC’s global capital markets business:
“Digitizing investment banking products and processes is seen by many as something on the horizon, but Nivaura is helping firms to make it a reality today without the need for large scale change programmes and disruption to existing businesses.”
Nikhil Rathi, CEO of London Stock Exchange plc and Head of International Development, LSEG:
“We are delighted to be taking a minority stake in Nivaura. The investment strengthens our existing relationship with Nivaura and underlines the Group’s partnership approach in innovating to support our clients in accessing global investment pools. We look forward to working with Nivaura to drive further innovation along the capital markets value chain to benefit both companies, their advisors and investors.”
Manuel Silva Martínez, Managing Partner and Head of Investments at Santander InnoVentures:
"Nivaura has proven its ability to deliver substantial cost reduction and open up new markets for clients that up to now remained unserved. It also has the potential to be the backbone of totally new offerings in the investment banking space, drastically changing the industry status quo through the lens of modern technologies and amazing institutional partners. We are happy to join Avtar and the team in building this vision together."
Alan Morgan, Nivaura Chairman and former Senior Partner at McKinsey and Head of Financial Services:
“We’re seeing a lot of generalised workflow and process automation startups, but little or no firms focused on capital markets, and even less narrowing in on primary issuance. This level of industry focus and commitment, combined with a compliance and commercial mindset, makes Nivaura an enabler for low cost and fast transformative change within investment banking.”
Patrick Pinschmidt, General Partner at Middlegame Ventures:
“Nivaura is on the right side of key secular trends in the market, given the preference of regulators to lower costs, expand access, and create more efficient and transparent new issuance markets. While Nivaura has validated its product offering through an assortment of low-profile market tests and partnerships and has made impressive inroads in attracting a cross-section of valuable partners, the company is now seeking to commercialize its technology on a global basis. Moreover, the company’s blockchain-based smart contract technologies provide an innovative and promising avenue to achieve key reform and efficiencies for issuers, investors and intermediaries across the capital markets.”
Richard Levy, Capital Markets partner at Linklaters:
“We are excited about the prospects for Nivaura and our collaboration with them. Nivaura’s vision is to enable end-to-end automated issuance of financial instruments and it is putting the legal documentation that underpins capital markets transactions at the heart of what they do. Its work has the potential to fundamentally change the way in which deals are executed and administered and we are looking forward to helping Nivaura shape the future of the capital markets.”
Nivaura is a workflow management and process automation platform focused on the primary issuance processes in capital markets. Its product offering consists of modular technology services enabling automated and compliant operation of the full lifecycle for issuance and administration of financial instruments, such as bonds, loans, equity and structured products. Founded in London in 2016, Nivaura has participated in all of the first four FCA regulatory sandboxes, during which it gained its MiFID and CASS regulatory approvals. Nivaura combines technological innovation with legal and regulatory rigour to act as a true utility. Capital markets firms can access the platform through a cloud or an on-premises deployment, and quickly and efficiently start offering digital investment banking services to their clients. They can also leverage the platform and start building proprietary issuer and investor focused advisory applications to offer additional value for their client’s investment banking needs. In this way firms can focus on what gives them the competitive advantage, client focus, while tapping into low cost and compliant commoditized operational and workflow infrastructure as the foundation.
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