Financial services AI business lands £2.5m venture capital injection
Manchester investor Praetura Ventures has injected £1.8m into London-based FeedStock as part of a £2.5m funding round led by Praetura.
FeedStock is an AI-driven SaaS business that leverages the latest natural language processing technologies to enable financial services companies to meet both their compliance requirements and commercial goals.
Praetura made its invedstment from its Praetura EIS 2019 Fund.
Existing investor Illuminate Financial and a selection of angel investors, as well as Force Over Mass, are contributing a further £700,000.
FeedStock is one of the first AI solutions to deliver value for clients on both the buy and sell-side of financial services institutions.
The system streamlines compliance requirements, cost control measures and revenue-generating activities by analysing communication streams within enterprises.
The data generated gives businesses the edge to make smarter decisions and meet stringent regulatory requirements.
Its leading product, Cortex, automatically scans emails and chat streams, as well as calendar events and research portals to ensure compliance with investment research regulations imposed by MiFID II, the landmark legislation introduced by the EU in 2018.
The recent growth in demand for FeedStock’s Cortex product is a demonstration of the buyside’s increasing efforts to adopt emerging AI technologies to streamline existing operations and unlock value in their data.
Cortex is being used by some of the largest and most successful asset managers and hedge funds globally.
Building on the success of Cortex, FeedStock released Synapse last year, a product which analyses a firm’s communications with clients in real-time to deliver insights for Next Best Action (NBA) as well as automating CRM data entry.
The software is used by tier one institutions to automate manual data entry into CRMs and to map key customer relationships.
Synapse automatically informs businesses when an account is at risk of churn, identifies opportunities within the existing client base and assists with the management of large enterprise sales teams.
FeedStock was founded in 2015 and is run by co-founders and joint managing directors Charlie Henderson, a former corporate broker, and Lucas Wurfbain, who was previously a fund manager.
The business is based in London’s Covent Garden and operates across multiple jurisdictions with clients in the US, Europe and UK.
The funding will enable FeedStock to accelerate the rollout of its products, expand the size of its team and extend into new markets.
The deal is Praetura Ventures’ 10th in the past six months, with a total of £12.6m invested in early-stage businesses since June. FeedStock is the third AI-focused business in Praetura Ventures’ portfolio, following investments in Peak and Futr.
Charlie Henderson said: “With our background in highly-regulated businesses, we are seeing enormous appetite for our proprietary technology; not only from businesses required to comply with MiFID II, but also for enterprises that are looking to leverage AI as a core component of their business for efficiency gains and revenue generation.
“Financial services firms recognise that investing in their compliance and technology is key to winning and retaining the trust of customers and investors. These businesses also understand the importance of analysing data to power smarter decisions ahead of their competitors.
“It’s clear to us that the team at Praetura Ventures understand the opportunities and challenges in our sector, and also understand the potential of where we can take the business.
“Their entrepreneurial and proactive approach resonates with our values and they will help us to successfully deliver our growth strategy. We are looking forward to working with them closely.”
As part of the deal, Mark Lyons, director at Praetura Ventures, will join the FeedStock board as a non-executive director.
Mark Lyons said: “Our support for FeedStock fits well with our strategy of investing in exciting businesses led by entrepreneurial management teams with experience in high-value sectors.
“AI is beginning to disrupt financial services in a positive way. The most forward-thinking businesses recognise that proprietary software like FeedStock’s will be at the heart of their future business models.”
He added: “We’ve been hugely impressed with the experience and vision of Charlie and Lucas and are confident that with our support, the business will deliver on its ambitious growth targets.
“They have developed a world-class product with significant momentum, and we are very excited about what the future holds for the business.”
Other high-profile businesses backed by Praetura Ventures include AI and machine learning business, Peak, and online delivery platform, Sorted.