Derivative Path Raises $35 Million in Growth Equity Funding from FTV Capital
Derivative Path’s First Institutional Round Will Accelerate Expansion of Cloud-Based Capital Markets Technology and Services Platform
San Francisco, CA – June 24, 2020 – Derivative Path, Inc. (DPI), a leading capital markets financial technology and services company, announced today that it has secured $35 million in growth equity funding from FTV Capital, a successful investor in innovative, high-growth companies within the enterprise technology and services, financial services, and payments and transaction processing sectors. The investment is DPI’s first outside institutional round and will be used to expand its product offerings and help accelerate the company’s client-centric growth with financial institutions, end users and buy-side clients using DPI’s interest rate derivatives and foreign exchange platform.
DPI was launched in May 2013 by a founding team of capital markets sales, trading, technology, and market risk professionals that also provided the company’s initial funding. Beginning as a leading-edge trading platform for regional banks, the company has added new capabilities to its platforms, including automated hedge accounting and comprehensive interest rate derivative product coverage, and expanded into new asset classes like FX. Derivative Path’s platform has become the system-of-record for interest rate and FX hedges for many of the leading regional banks in the U.S. and this investment will help DPI enhance its offerings while continuing to provide best-in-class client service and support.
Derivative Path’s cloud-based trading technology, DerivativeEDGE®, is a state-of-the-art derivative trading platform that facilitates effortless interest rate and FX hedge activity management. The system was designed as a complete end-to-end solution where users have front-, middle-, and back-office functionality in one platform, eliminating the inefficiencies of working with disparate systems to manage various aspects of operational and pre/post-trade workflows. The platform, which has been used by over 130 banks and institutional clients, also comes complete with automated Dodd-Frank compliance, integrated real-time market data, automated swap data reporting, and cleared trade affirmation.
“Seven years ago, we were very fortunate to be able to put together a team of founding principals who were experts in their respective disciplines, had a clear vision of where our industry was going and recognized the important role technology would play to help market participants manage their trading businesses,” said Pradeep Bhatia, co-founder and co-CEO at Derivative Path. “Since then, we have continued to grow our team with professionals with deep expertise equipped to tackle and solve the problems our industry faces. Despite all we have accomplished in the last several years, this is just the beginning. This transaction with FTV Capital is validation that Derivative Path and its technology are poised to continue to grow market share and drive innovation in the industry. We look forward to partnering with FTV Capital to further support our clients and lead the market through product innovation.”
Over its 22-year history, FTV has partnered with outstanding management teams, often as the first institutional investor, to help companies scale and drive growth by leveraging FTV’s deep sector expertise and its Global Partner Network® — over 400 executives from many of the world’s leading financial services firms who deliver transformative insights and strategic networking opportunities. FTV also leverages its team of operational experts to help support its companies in executing their ambitious, strategic plans.
“Financial institutions and corporates continue to increase their adoption of interest rate and FX derivatives to more effectively manage balance sheet and operational risks,” commented Robert Anderson, partner at FTV Capital. “Through a unique combination of expertise, technology and service, the seasoned team at Derivative Path continues to democratize the usage of derivatives for operational use cases, such as back-to-back lending, balance sheet hedging, supply-chain FX exposure, and more. The company’s purpose-built technology platform combined with top-tier service has led to happy, successful customers and an impressive growth trajectory. We are proud to announce this partnership and look forward to supporting DPI’s next chapter of innovation.”
Alongside the investment, FTV Capital’s Robert Anderson and Brent Fierro will join Derivative Path’s board of directors.
About Derivative Path, Inc.
Derivative Path is a San Francisco Bay Area-based FinTech company with additional offices in New York City and Chicago. The company provides a technology-led solution to assist financial institutions, buy-side, and commercial end-users in executing and managing their over-the-counter interest rate derivative and foreign exchange transactions.
The Derivative Path team is comprised of derivative industry veterans who have held senior positions with some of the world’s largest capital markets firms, such as Wells Fargo, ABN AMRO, Société Générale, Bank of America, Barclays, AIG, and JPMorgan Chase. For more information about Derivative Path, visit www.derivativepath.com.
About FTV Capital
FTV Capital is a growth equity investment firm that has raised nearly $4 billion to invest in high-growth companies offering a range of innovative solutions in three sectors: enterprise technology and services, financial services, and payments and transaction processing. FTV’s experienced team leverages its domain expertise and proven track record in each of these sectors to help motivated management teams accelerate growth. FTV also provides companies with access to its Global Partner Network®, a group of the world’s leading enterprises and executives who have helped FTV portfolio companies for two decades. Founded in 1998, FTV Capital has invested in 115 portfolio companies, including Docupace, Edgewater, Enfusion, InvestCloud, Riskalyze, Strata Fund Solutions, Sunlight Financial, True Potential and exited companies Actimize (acquired by NICE Systems), Apex Fund Services (acquired by Genstar), EXLService (NASDAQ IPO), Financial Engines (NASDAQ IPO), Fleet One (acquired by Wright Express), Globant (NYSE IPO), HCS (acquired by Ally Financial), and WorldFirst (acquired by Ant Financial). FTV has offices in San Francisco and New York. For more information, please visit ftvcapital.com.
PROSEK PARTNERS, ON BEHALF OF FTV CAPITAL
HEAD OF BUSINESS DEVELOPMENT