UBS invests in regtech expanding into wealth management
Droit helps traders decide in milliseconds if deals comply with the ever-changing rules and aims to do the same for wealth managers.
It is a tough time for fintechs seeking to raise new money, as institutional investors in growth and late-stage venture capital brace to deliver much lower marks to their limited partners than when they last bought into the supposed winners in payments, remittances, sub-prime credit and other markets.
But it can still be done. And one corner of the financial markets that remains in permanent growth mode is compliance with ever-increasing regulations.
On Tuesday, Droit, a 10-year-old regtech company founded by former traders and whose technology can decide in milli-seconds how any trade a bank wants to put on in any jurisdiction with a given counterparty fits against the ever-expanding mesh of regulations, closed a $23 million investment in its latest series-B funding round.
UBS is the anchor investor in a round that will provide Droit with funds to recruit technologists, product managers and knowledge engineers to expand a business originally designed to serve wholesale capital markets into wealth management.
Brock Arnason, founder and chief executive of Droit and a former banker at Morgan Stanley and UBS, tells Euromoney: “We get a lot of inbound queries from institutional investors, but they tend to want larger ticket sizes and to set specific rules for how they want a firm to grow.