InvestLab Secures Funding from Citi and VantagePoint, Plans Financial App Community [INTERVIEW]

InvestLab

InvestLab is a Hong Kong-based financial tech startup that hasn’t been around long but has been making big waves in Asia. Recently, we learned that InvestLab had secured investment from Citi Ventures and VantagePoint Capital, so we got in touch with the company’s founder, Mark Munoz, to learn more about the investment and InvestLab itself.

So give us the basic rundown: what is InvestLab and what are Tradepop and Mix?

InvestLab is a financial technology provider, so our goal was really to help empower people to discover new markets. We do this through Tradepop; that’s a social investing site that has this really unique, real-time sentiment platform. And then Mix is single-dealer online trading technology for retail brokerage firms. So Tradepop is a consumer-driven product; anyone can go to Tradepop. But Mix is really behind the scenes, and we work with a number of brokerage firms to give them Mix, which they then private-label, and Mix actually includes Tradepop as well.

How did InvestLab get started? It’s fairly new, right?

Yeah, it’s really new. I had started up a company in Hong Kong called Penson, Penson Asia. Penson’s actually a listed US firm, and I’d started up their Asia business going on almost five and a half years ago. So I was meeting with a bunch of retail brokerage firms, whether they were in Hong Kong or Taiwan or Japan or Singapore where I am right now, and they all had the same problem. I kept hearing from each of these firms that, ‘Ah, my client base, they’re trading in Singapore (for example) but they really want to reach the US market. I don’t have the technology that allows them to place trades into that market. I don’t have the market data and frankly I don’t have the expertise to make sure that I can comply with all my regulatory and compliance needs in my local market.’

So after hearing this story for about three years, I realized that there’s a real demand for global trading technology for retail investors. The institutional market, the big trading desks that you see in the big firms like Goldman and so forth, they have plenty of technology, but the retail guy, the individual, somebody like myself doesn’t. And so that’s where I decided to go ahead and… Penson was in great shape, so I left Penson and started InvestLab.

That was October of 2010. I spent the first six months, basically, just putting together the plans for InvestLab and starting to work on different technologies and prototypes, because we have a really unique way that we deliver it, using different cloud services and how we scale and so forth. That took quite a bit of time. Plus, we’re dealing with financial information, so we have to be very careful and we’re very sensitive to how the data’s stored and making sure that we comply with not only our clients’ needs but also the local regulatory needs. So that also took some time to figure out.

So you have an office in Hong Kong, and also one in San Francisco now?

Yes, and Singapore! Yeah, that’s not a typical startup way to go! Hong Kong is our home. Hong Kong is where I founded the company, it’s where we started everything, it’s where we had our initial developers, it’s where all of Tradepop is being built out of. What ended up happening was the San Francisco office came about simply because we had a group of engineers and some really smart people that I’d worked with in the past — because I’d started up another company in the Bay Area — and so, I wanted to make sure that we all continued to work together.

But one thing that I think, particularly for a startup like ours, because we’re in an enterprise space — we’re dealing with brokerage firms and there’s a level of sophistication, to be frank, that has to go into our platform — we needed folks with really good domain knowledge who understood building very complex financial transaction systems and how we were delivering it. The talent for that, unfortunately, wasn’t in Hong Kong. It’s actually in Singapore. So our office in Singapore developed because of just, frankly, the need to find the right people.

So how much of a challenge has it been building a qualified team with so many different markets and regulatory issues in Asia?

It has been [a challenge] to some degree. Luckily what happened to InvestLab early on was running into somebody like our COO Miguel Perez, who has got fifteen years at Citibank behind him, or Nate Emerson, who used to be the former CEO for ABN or Deutsche Bank, I think it was, on the equity side. So these guys have a ton of experience along with me, so we’ve dealt with all of these cross-broder issues in Asia prior [to starting InvestLab]. The challenge for a company like us though, has been just finding the right developers, finding the right engineers that could implement it in this unique way that we’re going about. In a typical Bay Area startup or in a typical startup you might have somebody that has, maybe, a couple years worth of development experience. Our team here has, on average, about ten years of development experience. It wasn’t so much the business side was a challenge, it was more of the software development side.