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The terms of the agreement were not revealed, but it was disclosed that this is the first transaction in a multi-stage acquisition towards full ownership of FairXchange.
November 23, 2021 - United Fintech has acquired a 25% stake in London-based FX data and analytics service provider FairXchange for an undisclosed amount, in a transaction integrating the Company, its products and employees onto United Fintech's digital platform. According to the official announcement, this is the first transaction in a multi-stage acquisition towards full ownership of FairXchange by United Fintech.
Trading firms and venues use FairXchange’s analytical tools to facilitate data-driven dialogue with their counterparties and clients, bringing clarity and transparency to execution performance through the provision of independent data.
FairXchange, founded in 2016, has managed to acquire some trophy clients. Sucden Financial adopted FairXchange's Horizon platform in 2018, OANDA partnered with company last year for independent FX execution analytics. More recently, trading venues [Deutsche Börse’s 360TGTX] (https://liquidityfinder.com/news/360T-Selects-FairXchange-Horizon-for-Independent-FX-Execution-Analytics?id=ckvupqn3cati50c04oxod29n3) and Dmitry Galinov's 24 Exchange also selected FairXchange's Horizon platform for FX analytics.
According to United Fintech CEO Christian Frahm, FairXchange fits 'hand-in-glove' with United Fintech’s strategy of acquiring state-of-the-art Capital Markets software products ready for scaling and global roll-out on United Fintech’s platform: “FairXchange’s business critical, data-driven product, Horizon, is already being used by an extensive client base including a number of global financial institutions, and with the onboarding to United Fintech’s platform, we look forward to enabling FairXchange to continue its growth journey and scale with us. As United Fintech will onboard the Company’s clients and FairXchange will get an opportunity to grow within our clientele, this is a mutual win for both parties - and a milestone for United Fintech, completing its third transaction in just one year.”
Christian Frahm also noted that the acquisition won’t have any impact on everyday business for FairXchange’s clients or employees, adding that ahead of the transaction, United Fintech showed Horizon to six major global banks, aligning it with their product roadmaps.
The official announcement also stated "Over the next few years, it is United Fintech’s ambition to complete multiple strategic acquisitions of ready-to-scale fintechs with proven Capital Markets products, positive cash flow and growth potential; to build a fintech “one-stop-shop” that global banks can benefit from - and become market leader in this niche. The ambition is to help big banks and financial institutions accelerate the implementation of innovative digital technology, and according to FairXchange’s Founder and CEO, former Morgan Stanley executive Guy Hopkins, United Fintech’s platform is the market’s most suitable candidate to fulfil that exact mission."
Guy Hopkins, FairXchange Founder and CEO, commented, ”FairXchange has seen rapid, exciting growth in recent years; however we are still a small team and as we scale up we recognise the importance of choosing the right partner to help us accelerate that growth. From the first conversation, we knew United Fintech was the perfect fit; a compelling vision, an innovative business model and a very impressive management team with deep expertise in financial markets. We’re looking forward to joining the United Fintech platform, increasing our own reach while also contributing to the wider success of the group."
Guy Hopkins will continue to lead the Company as the designated Trading Analytics product on United Fintech’s platform.
United Fintech launched just over a year ago in November 2020, in the middle of the Coronavirus crisis. The firm now has more than 100 employees in Copenhagen, London, New York, Berlin and Romania and has completed three acquisitions already.
United Fintech CEO Christian Frahm sold his first fintech firm CFH Group to British-listed Playtech Plc in 2016. Although the discreet deal made Frahm a familiar face in fintech, it didn’t fulfil the native Dane’s ambition to “save big banks from Big Tech” - a phrase which has become the informal mission slogan of United Fintech. And according to Christian Frahm, fintech is what all of the financial industry is currently scrambling to get ahead of; to compete with the emerging threats from startups and scaleups like Stripe, Revolut etc. as well as Big Tech and Silicon Valley.
"The City and Wall Street will see bigger disruption in the next 10 years than they have seen in the past 100 years. The whole industry desperately needs to access the most innovative minds and products globally, but the onboarding at all bigger institutions is killing any chance of new products actually getting into the banks in the first place. We are born as a partner for banks to help them transition quickly from slow motion into this lightspeed world. The next 10 years is all about speed for the banks. And they no longer have the luxury to do it by themselves. Banks need partners. United FIntech unites founders of the most innovative fintech businesses globally and brings them to the big banks under one central umbrella - an innovation platform where banks feel comfortable taking risk on new products; so that they can faster and more seamlessly onboard new technology. And the acquisition of FairXchange is a great example of doing exactly that,'' concludes Christian Frahm.
In addition to FairXchange, United Fintech acquisitions to date include NetDania, which provides market data, APIs, market terminals, charting components and full white-labels, and TTM Zero, which develops fully digitised RegTech and Capital Markets Tech solutions.
