LoopFX Taps Funding from Augmentum Fintech
Posted by Colin Lambert. Last updated: June 26, 2024
With The Full FX View
FX dark pool matching platform LoopFX has secured further funding as it develops its business, tapping GBP 2.6 million from the UK’s only publicly-listed investment company specialising in the fintech sector, Augmentum Fintech.
LoopFX launched in late 2022 as a venue that matches off large interest, both between buy side firms and the major dealers – the peer-to-peer-to-bank model – and has connected to Portware and FX Connect since.
Augmentum’s founder and CEO Tim Levene will join the board of LoopFX, which is chaired by John Sievwright and includes experienced financial services entrepreneurs Martin Gilbert, Michael Soutar and Ivan Ritossa.
The Full FX View
In the big scheme of things, just over GBP 2.5 million will not make waves in the FX industry, but attracting outside investment is an important step for LoopFX as it not only provides capital for expansion, it also delivers a public statement of support for the firm’s model.
There are plenty of platforms in the FX industry, some who barely survive, some who thrive, but it is a crowded space, and that means any challenger has to have both a slightly different take on the business, and is able to exploit a relatively narrow window of opportunity.
I have written previously of that window of opportunity, and suggested that Loop is in that period wherein it attracts interest and goodwill – both of which it needs to turn into business – and funding and an expression of support helps extend that window. The firm is able to add bodies if it needs, but perhaps more importantly, it can sit opposite prospective partners – and partnering with other vendors/platforms is very much part of the model – with the knowledge that the people around the table also know it has backing.
Too many great ideas in our industry run out of time and money, publicly projecting that is not the case with a particular business is critical to it both succeeding, and, more importantly, getting the time to succeed. There are still sceptics around the peer-to-peer model in FX – I remain in that camp – but while there are sceptics over the dark pool model, I do not sit there, and nor, apparently, to Augmentum Fintech.
Investment is nothing without the right business model and pipeline of clients, but equally too many ideas are nothing without investment – this should ensure LoopFX maintains momentum. It remains to be seen whether Loop can bring the FX industry with it, but one thing is for sure, it is being given every opportunity.
“Augmentum’s experience and network will be strategically vital for LoopFX as we move towards launch,” says Blair Hawthorne, founder and CEO of LoopFX. “Their investment will allow us to build our team and accelerate our capability to meet the needs of our customers. As our first institutional investor, Augmentum will join the ranks of other world-class collaborators, including our first partner State Street FX Connect, as well as FactSet’s Portware.”
Levene, adds, “We are increasingly focusing on the opportunity in the capital markets space where we see a trend of incumbents opting to collaborate and partner with innovative early-stage companies. We believe LoopFX offers a text-book example of a fintech operating in the capital markets in partnership with blue chip financial institutions. LoopFX brings efficiencies in trading and price discovery to the FX market which in turn will help participants comply with MiFID II’s best execution trading regime.”
