Electronic trading consultancy Adaptive Financial Consulting has acquired Real Logic, a low-latency trading technology development firm founded by high-performance computing specialist Martin Thompson, who will be joining Adaptive’s management team as Head of Platform.
Prior to setting up Real Logic in 2011, Thompson was CTO of financial exchange LMAX, and is seen as one of the world’s top experts in low-latency and high-performance systems. Todd Montgomery also joins Adaptive as an Engineering Fellow. Earlier in his career, Montgomery was CTO of 29West, where he designed a leading low-latency messaging solution widely used in capital markets.
Real Logic’s Aeron – an open-source messaging system focused on trading systems – and Aeron Cluster – a technology that provides fault-tolerance through consensus – underpin Adaptive’s Hydra Platform, a high-level development platform which accelerates the development of trading systems. Consolidating the two teams will enhance Adaptive’s ability to deliver bespoke trading systems, according to the company.
“We’ve built a great developer acceleration framework that lets our consultancy business deliver very quickly for our clients,” says Matt Barrett, Adaptive’s CEO. “What we haven’t built is a point solution, because we don’t want to be a product vendor. Martin and Todd have a very similar perspective. It’s about having a platform that lets firms build exactly the right business solution for them, in an architectural style that is very well suited for the front office, in terms of how it’s engineered. Having the tech stack all aligned is going to be fantastic for clients and fantastic for us. And we’ll also have the added benefit of the open source community that’s been built up around Aeron and the Aeron cluster.”
Open source plays a significant part, says Thompson. “Modern open source brings a number of benefits, particularly around quality and review and reach,” he says. “When people pick up Aeron, they find a level of quality that they don’t tend to get in other products. And that’s not just credit to the team that’s worked on it, it’s down to the extent of testing and the feedback that comes with open source, where people crawl over the code and get to understand it. That really raises the level of quality. We get people testing stuff in new and interesting ways that we haven’t even thought about, and then they feed that back to us. That feedback cycle, without barriers, is hugely valuable.”
“There’s a perception that as a development consultancy, we would be against open source, because if we could get paid to re-implement things over and over again, that’s supposedly good business,” adds Barrett. “But actually, it’s bad for customer value and therefore bad business. It’s also bad for morale, and bad as an engineering approach, so there’s a lot of reasons we wouldn’t want to do that. Any time we can leverage either open source or a good ‘fit for purpose’ product to deliver differentiation and real business value for clients, we would leap at that opportunity.”
Adaptive was advised by Strata Partners on the acquisition. Matt Barrett will be delivering a keynote on ‘Technical Intensity’ at A-Team’s forthcoming TradingTech Summit in London on February 22.