TransFICC plans to launch buy side service, ING and HSBC lead a funding round

TransFICC, fixed income and derivatives venue connectivity specialist, secured £5.75 million in a recent funding round including HSBC and ING, as the company confirmed its plans to release a buy-side version of its flagship API platform.

Albion VC, with HSBC and ING Ventures also participating as new investors, led the Series A investment round. They join existing shareholders Citi, Illuminate Financial, Commerzbank’s Main Incubator group, and The FinLab.

TransFICC founder Steve Toland pointed out that the evolving fixed income market structure leads to banks like Citi, HSBC and ING needing access more venues, which poses major challenges regarding differences in workflows. TransFICC’s clients currently include five global investment banks and one market data vendor.

Steve Toland commented:

Steve Toland

We have different workflows coming through from venues like Bloomberg and Tradeweb, whether that’s list trading or portfolio trading, but that buy-side flow is now being automated so the sell-side needs to adapt. Banks need to connect to different venues to support new trading types, and they also need to ensure their liquidity is directly accessible to some clients. The infrastructure has to be more flexible, scalable and adaptable.

TransFICC’s e-trading platform is designed to assist the sell-side with challenges regarding the increasing fragmentation of fixed income markets. Toland added each bank looks to connect with from 35 to 75 different trading venues, allowing firms to connect to venues and supports various workflows across rates and credit bonds, and more recently interest rate swaps.

The recently raised funds will be utilized in the enhancement and acceleration of TransFICC’s plans to scale up and support more trading venues. Some of the funds will also be used in launching a buy-side version of the platform, following an increase in interest for TransFICC’s connectivity services from asset managers, particularly during this year.

Toland added:

That has been driven by increased automation, portfolio trading mostly, and essentially, you need those automated trading types because they are far more efficient. But it’s also the impact of the long-term regulatory requirements for asset managers. Those on the repo side for example will be held to SFTR, so there’s a requirement to build automated electronic trading systems.

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