- JPMorgan Chase is acquiring a provider of data analytics for start-up investors called Aumni, and CNBC is first to report.
- The largest US bank by assets is acquiring a five-year-old Utah-based company as part of a broader drive to deepen relationships with venture capital investors and their firms.
- While terms of the deal were not disclosed, JPMorgan is paying roughly what the startup was assessed at its last fundraiser in 2021, according to a source. Aumni is worth $232 million after that tour, according to Pitchbook.
Signs outside a Chase Bank branch in San Francisco, California, on Monday, July 12, 2021.
David Paul Morris | bloomberg | Getty Images
JPMorgan Chase acquires a provider of data analytics for start-up investors called Omani, CNBC is the first to report.
The largest US bank by assets is buying a five-year-old Utah-based company as part of a broader drive to deepen relationships with venture capital investors and their companies, according to Michael Elangianwho leads JPMorgan’s private digital markets efforts.
While terms of the deal were not disclosed, JPMorgan is paying roughly what the startup was assessed at its last fundraiser in 2021, according to a source. Aumni is worth $232 million after that tour, according to Pitchbook.
The deal is the latest in a series of fintech acquisitions made under CEO Jamie Dimon. Since 2020, JPMorgan has bought six startups to boost its capabilities in areas from payments to investing in ESG. The company’s investments in technology have come under scrutiny recently amid the bank’s soaring expenses and an intense legal dispute over a 2021 acquisition.
Elanjian said JPMorgan decided to buy Aumni after leading its 2021 investment round. Founded in 2018 by Tony Lewis, a former corporate attorney, Aumni is a data platform that helps users analyze and understand their holdings via a simple dashboard.
Most of the venture capital industry still uses Microsoft Excel or similar products to track investments in portfolio companies, Lewis said, which can make it difficult to get insights into their holdings. This is because the contracts underlying a single equity round can exceed 600 pages of thick legal writing, he said.
“The minute you want to start making any kind of data science query into your current investment business, it becomes a really big job to precisely track that information and put it into Excel and do the work,” Lewis told CNBC via Zoom.
He added, “This is an issue for anyone investing in any private alternative assets; it is based on a private contract, which is where your economic and legal rights lie.”
Investors have relied on Aumni in recent weeks after the Silicon Valley bank collapse sent shock waves through the startup community, according to Lewis. He said that because of concerns about uninsured deposits in mid-sized banks, VCs suddenly wanted to know where their bank portfolio companies were operating, and whether they had legal rights to examine their books.
In other cases, venture capital investors can use Aumni to avoid mistakes associated with missing key details buried in legal documents.
Lewis said the startup has data on nearly 18,000 portfolio companies worth $3.6 trillion. He said it charges an annual subscription fee based on the assets under management and the number of companies being tracked.
The service will be integrated with JPMorgan’s private markets platform Capital Connectwhich came out of stealth mode last year, Elangian said. It also completes the acquisition of the bank last year From Global Equity, a software provider for managing employee stock plans.
The broader goal, he said, is to become the digital destination for venture capitalists, startup founders, and other investors to raise funds, network, and leverage loans. He said Capital Connect now has 200 employees and about 850 clients.
“We want to be the end-to-end ecosystem provider for the private enterprise community and markets,” said Elanjian.