ENSO Financial Analytics: Alpha Through Optimized Counterparty Relationships

Aug 31 2015 | 10:53pm ET

The folks at ENSO Financial Analytics understand that prime brokers can be a source of alpha-generating value above and beyond the traditional financing and treasury functions, so they’ve developed a suite of tools that help hedge funds develop comprehensive views of all their relationships across multiple prime brokers and counterparties. The firm has more than $750 billion in AuA and provides alpha-generating analytics to many of the world’s top hedge funds.

Company name: ENSO Financial Analytics

Location: New York and London

Website: www.ensofinancial.com

Fintech Sector: Financial Analytics 

Elevator Pitch: ENSO is revolutionizing the way that hedge funds and prime brokers communicate, enhance relationships and derive value. We do this by providing hedge fund managers with everything they need to optimize counterparty relationships. The result is data-driven informational alpha that empowers both buy- and sell-side firms to extract more value in a complicated regulatory environment with multi-dimensional constraints.

Year formed: 2011  

No. of Employees: 70 

Stage: In revenue 

Notable Investors: ICAP

Tell us a bit about your company and what it does. 

Our team of prime brokerage, asset management, technology and data specialists deliver identifiable and measurable operational benefits to fund managers every day. We achieve this in two ways. First, by providing a suite of powerful analytics and tools that vest our hedge fund clients with a macro view of all their counterparty relationships through a fully hosted platform. At the same time, all of these counterparties can connect and directly engage with our hedge fund clients.

How is ENSO different than other companies in the same space?

We deliver data and insight on counterparty credit risk, collateral management, portfolio financing and treasury. We understand that prime brokers are valuable sources of information alpha above and beyond financing and treasury functions, so we give our clients tools to cultivate these relationships. 

We’re also backed by industry leaders, including ICAP, the world’s largest interdealer broker and a leading post-trade market data provider.

What is your revenue model? How will the company make money? 

ENSO offers data analytics and service solutions for clients ranging from basic products (ENSO Core) to fully customized and integrated deployments. The ability to tier our pricing model to cater to clients’ needs allows managers from a wide range of AUM to benefit from our technology and analytics.  

As our clients grow, we continue to introduce new value-added services for both hedge funds and prime brokers that address the unmet needs of both of these client groups.

Who is your target market? How big is the opportunity? 

We have historically targeted large asset managers, specifically hedge funds, as well as large broker dealers. It’s a very competitive space and represents a huge potential market. There are some $3 trillion in global hedge fund assets and at least two-dozen significant broker dealers that function as counterparties for hedge funds. We believe each and every one of these firms could benefit from using ENSO technology. 

ENSO has recognized the same need within the smaller hedge fund community, and plans to expand our offering to assist managers with the same high quality operational insights and alpha-generating analytics.

Why are you and your team capable of succeeding? 

Our background is in designing technology platforms and proprietary algorithms for some of the world’s largest banks, including Barclays and UBS. We’ve been able to leverage this experience to better communicate with hedge funds and their counterparties and address their needs head-on. 

What’s your next target/milestone? 

We’re continuing to roll out several new services for the both the asset management and prime broker communities. We currently have over 80 clients, including 6 major broker-dealers. Our hedge fund clients collectively manage more than $750 billion in assets. Over the next year, we will continue expanding our client base both in terms of AUA as well as broker-dealer participation on the platform. 

What is one unusual fact about your company?  

The name ENSO derives from the Japanese word for circle, reflecting our vision and our purpose – to create a virtuous circle of value through transparency and communication between hedge funds and the dealer community.


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