One of the biggest misconceptions about the European tech scene is that it should operate exactly like the Silicon Valley tech scene. This is just plain dunderheaded. The truth – far too too seldom stated – is that as well as operating in a ‘Valley’ manner, equally European startups can come out of a sector-specific business context. Thus, music startups like Last.FM, Songkick and others have continued to emerge from London and Berlin where the music and creative scene in Europe is hugely strong. London is also becoming a center for fashion startups like Editd and Garmz. In that same vein, London is a big financial centre.
To that end today OpenGamma is a new kind of financial startup, based in London, which has an open source analytics and risk management platform for the financial services industry. Today it’s completed a $6 million Series B round of equity financing led by FirstMark Capital, a New York-based VC. Accel Partners joins the round as a return investor. OpenGamma previously had a Series A round of $6m from Accel Partners.
OpenGamma will use the extra funding to power up sales, marketing and commercial operations, open up global markets, reach out to the open-source community and build out the platform. It will also open an office in New York City to access the 500,000 financial services professionals in New York.
Lawrence D. Lenihan, founder and managing director at FirstMark Capital, who will also join the board, says the global economic crisis was in part a result of the financial system’s inability to manage real-time risk across disparate but connected asset classes and geographic regions – so having an open source platform like OpenGamma is the next phase of linking these up.
OpenGamma has an open architecture to allow financial services firms to develop analytics applications aimed at traders and risk managers. This open source approach is designed to disrupt the proprietary software platforms. To me this reminds me of the kind of things Everbread and Tradeshift are doing in travel and invoicing respectively.
Expect to see many more open source platforms and third party apps develop in this space. There is a great deal of money in this sector and London tech companies, increasingly connected to the City, are well aware of this.