CloudMargin raises $15 million in Series B funding round

By Robin Amlot

UK-based CloudMargin, creator of the world’s first collateral and margin management solution native to the cloud, has closed its largest funding round to date, bringing in $15 million in a Series B capital raise. Primary investors included Deutsche Börse along with Tier-1 global investment banks and current CloudMargin clients Deutsche Bank and Citi.

CloudMargin CEO Stuart Connolly said: “We’re delighted to enjoy the confidence of these premier global institutions and to give them an important voice on our Board of Directors as we continue on our exciting growth trajectory. During this unprecedented period of global turmoil and market volatility, it speaks volumes for the CloudMargin business model, achievements and strategy that we were able to successfully close this meaningful investment round with such high calibre partners as Deutsche Bank, Deutsche Börse and Citi. For financial services institutions, the impact of COVID-19 has further reinforced our value proposition by highlighting many challenges the industry has faced for a prolonged period and acting as a catalyst to drive transformational change; firms are placing a strategic priority on adopting modern, Software-as-a-Service based cloud technologies that provide agility as well as operational and cost efficiencies.”

Connolly said the funds will be used to develop the platform and technological capability to deliver an enhanced product and service for clients and partners. In addition, the firm intends to expand its sales and client service capabilities in the US and Asia to meet greater demand.

Tilman Fechter, Head of Banking, Funding & Financing at Clearstream, part of Deutsche Börse Group, said: “CloudMargin is a perfect investment opportunity for Deutsche Börse and its post-trading services provider Clearstream. Its innovative and agile technology brings crucial momentum to all players in the collateral management industry, from the largest investment banks to small and medium-sized buy-side institutions. Joining forces between established trusted players and a flexible start-up like CloudMargin is essential to future-proof the business for all market participants.”

Jefferies LLC served as CloudMargin’s financial advisor on the transaction. Since the company’s inception in 2014, CloudMargin has raised $35 million through equity issuance, with investors including IHS Markit, Jefferies and Illuminate Financial.

CloudMargin’s Software-as-a-Service (SaaS) model is helping sell-side and buy-side financial institutions globally – including brokerage firms, banks, asset management firms, pension funds and insurance companies – as well as outsourcers and other technology firms meet time-critical regulatory deadlines and reduce costs associated with collateral requirements that are growing dramatically.

With more than 20 integration partnerships, CloudMargin was the first collateral management solution provider to be a member of the SWIFT network, facilitating straight-through processing through settlement.