Goldman spinoff Simon Markets raises $100 million in latest funding round

Goldman spinoff Simon Markets raises $100 million in latest funding round
The financial technology platform, which provides financial advisers with access to alternative investments, saw its valuation top $800 million with the funding round led by WestCap.
JUL 22, 2021
By  Bloomberg

Simon Markets, a financial technology platform that spun out of Goldman Sachs Group Inc., secured up to $100 million in a financing round led by growth equity firm WestCap.

The funding round will enable the New York-based firm, which counts financial advisers as users, to expand into alternatives like private equity and hedge funds, as well as digital assets such as cryptocurrency funds, Chief Executive Jason Broder said in an interview. Simon may also seek to expand into Europe and Asia, make strategic acquisitions and invest in portfolio analytics tools.

The transaction values Simon at more than $800 million, people with knowledge of the matter said. The company was developed at Goldman Sachs and was spun off in 2018.

Goldman is an investor in Simon, as are Barclays, Credit Suisse Group, HSBC Holdings, JPMorgan Chase & Co., Prudential Financial Inc. and Wells Fargo & Co. Existing investors participated in the latest round.

“We’ve experienced incredible growth since the spin-out,” Broder said, citing a tripling in volumes to $25 billion in calendar 2020 from the year prior. Simon is on track to double that figure in 2021, he added.

The company’s platform provides wealth managers across the U.S., including Raymond James Financial Inc. and Nationwide, with access to structured investments such as market-linked notes, defined outcome ETFs and registered index-linked annuities which Broder says offer a level of protection against current market volatility.

Roughly 100,000 financial professionals have access to Simon, and about 30,000 have used it so far this year. That’s a figure that Broder says the firm will seek to boost in part through education about structured products, which are known for being complex, and by bolstering offerings.

“Simon is demystifying the alternatives space,” said Kevin Marcus, a WestCap partner who is joining the company’s board. Financial advisers will have to change as technology advances and as clients demand more interaction, he said.

WestCap’s bet on Simon was partly fueled by its belief that the wealth management industry will increasingly shift toward alternatives from traditional asset classes, he added.

Latest News

SEC bars ex-broker who sold clients phony private equity fund
SEC bars ex-broker who sold clients phony private equity fund

Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.

The key to attracting and retaining the next generation of advisors? Client-focused training
The key to attracting and retaining the next generation of advisors? Client-focused training

From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.

Chuck Roberts, ex-star at Stifel, barred from the securities industry
Chuck Roberts, ex-star at Stifel, barred from the securities industry

"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.

SEC to weigh ‘innovation exception’ tied to crypto, Atkins says
SEC to weigh ‘innovation exception’ tied to crypto, Atkins says

Chair also praised the passage of stablecoin legislation this week.

Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest
Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest

Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.