Bondcube, Ltd.

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Founded 2012, Liquidation filed July 2015
Headquarters London, UK; Boston, MA
Key People Paul Reynolds, CEO; Mark Germain, CTO
Products Trading platform for fixed income markets
LinkedIn Profile
Website http://www.bondcube.com/

Bondcube was a trade matching platform for fixed income markets. The platform was launched in April 2015 but filed for liquidation three months later.[1]


History

The company was founded in 2012 by two industry veterans, Paul Reynolds and Mark Germain, and was designed to bring an "all to all" to the fixed income market, attracting buy side and sell side participants.[2] [3]

In February 2014, Deutsche Boerse purchased a minority stake in Bondcube. Though the exact terms were not disclosed, the investment was reported to be "a low sum in the single-digit millions sterling."[4] Bondcube received a second round of funding from Deutsche Boerse later in 2014, raising its ownership stake in the startup to 30 percent.

Bondcube's platform was approved by the U.K. Financial Conduct Authority in December 2014, allowing the firm to operate in 31 European jurisdictions.[5][6]

"Sufficient Business Prospects Failed to Materialize"

In a statement following the liquidation, Deutsche Boerse said, "Although Bondcube succeeded to launch its platform, over recent months sufficient business prospects failed to materialize and as a result the long-term financial viability of the business deteriorated. In these circumstances, the shareholders decided not to provide further funding to Bondcube."


Products and Services

Bondcube allowed institutional investors and banks to search and match orders for bonds in the market via a trading screen.[7] Bondcube's platform is set up as an "all-to-all" structure, meaning both dealers and clients can provide and access the same liquidity. The rationale is that, under new regulations such as Basel III, which requires additional capital reserves at dealing banks, new sources of liquidity are needed. According to Bondcube CEO Paul Reynolds, "Bondcube would trade "anything, from government bonds, high yield and emerging market debt, to corporate bonds."[8]

Bondcube's business model included free connectivity for users, and would charge an annual license fee to sell side banks rather than charge trading fees. It would be free to institutional investors.

Key People

References

  1. Bondcube Files for Liquidation Three Months After Launching. Bloomberg.
  2. Bondcube. Bondcube.
  3. Deutsche Boerse buys minority stake in Bondcube. Financial Times.
  4. Deutsche Bourse acquires stake in fixed income platform Bondcube. Finextra.
  5. Deutsche Bourse acquires stake in fixed income platform Bondcube. Finextra.
  6. Bondcube Granted European Regulatory Approval. Press Release.
  7. Deutsche Boerse buys minority stake in Bondcube. Financial Times.
  8. Bondcube granted European regulatory approval. Automated Trader.