The data explosion has opened the door to market entrants that are disrupting whole industries. Start-ups like Propellant.digital that, with the support of Deloitte Legal, is breaking new ground in fintech.
Financial services relies on good data. A vast amount of money is spent on providing it, licensing it and using it. And, historically, much of that has been concentrated with a handful of major players.
Reforms like the EU’s revision of the Markets in Financial Instruments Directive have been designed to make data less opaque. Known as MiFID II, it legislates that trading venues must make data publicly available free-of-charge with fifteen minutes delay.
In reality, however, this data can be disorganised, inconsistent between trading venues, and, as a result, difficult to analyse.
Meanwhile, data from vendors is costly and buyers only get a limited view of the market.
Propellant.digital has come up with an answer and its unique tech solution is now assisting its customers to make data more transparent, more accessible and far more comprehendible.
Analytics and insights
Both sell-side and buy-side clients are using the cloud-based SaaS solution to clean up public data, de-dupe it, synchronise it between trading venues. This then enables advanced analytics and high quality insights.
“We don’t collect or sell data, we’re purely a technology provider,” says founder and CEO Vincent Grandjean. After long careers in fintech and capital markets, he and co-founder Allan Horgan had experienced the data issues up close.
“I could see what was available and knew that we could provide something that was much more efficient,” he adds.
The solution generates the kind of insights that can help a client manage their trading activity and risk profile. For example, when you trade, you win and you lose. You know at which price you won, but this can show clients at what price they lost, so they can adapt next time.
Dealers and venues can understand their market share across Europe, so can see where they’re trading well and if they’re trading on the right platform. From a buy-side perspective, it can provide historical data such as the last 10 trades on a product.
“The diversity of our clients is really interesting,” comments Dan Marcus, Propellant.digital’s strategic advisor. “We knew the banks would be interested but we’ve got venues, trading platforms, exchanges, trade associations – what Vincent’s produced is not just a solution for market participants, it’s for trade associations and regulators that want to get a better understanding of the data. It’s also being used by universities for research.”
Aligned on the journey
With our in-depth knowledge of data licensing and regulated financial services, Deloitte Legal has been on the journey from the beginning. Led by our technology partner Rich Folsom, our lawyers have been helping the new company to navigate the EU legislation, define its business model and manage the client onboarding process.
“They’re really shaking up some long-standing industry problems,” says Rich, “and for us, that’s an exciting thing to be part of. It’s also a chance to show how committed Deloitte Legal is to supporting new business models and innovation in financial services.”
Eighteen months in and the company has already signed 27 clients and earned award nominations and honours.
Currently focused on the EU and UK markets, it has set its sights on expansion into the US as the appetite for greater transparency grows. There are also opportunities in exploring alternative data.
“Engaging good lawyers has made a difference to us,” says Vincent. “For a start-up to be successful you need to have the right people alongside you and the stars have to be aligned from day one. I think Deloitte has been one of our stars.”