About a-team Marketing Services
The knowledge platform for the financial technology industry
The knowledge platform for the financial technology industry

A-Team Insight Blogs

Talking Reference Data with Andrew Delaney – The Curse of Approved Supplier

Subscribe to our newsletter

We were saddened to learn earlier in the summer of the demise of Hyper Rig, a pioneer in the area of risk aggregation. To us, Hyper Rig’s commercial offering seemed as close as one could get to meeting practitioners’ stated requirement for a means of deriving risk measurement/management information from the broad range of relevant data from across the enterprise.

The offering seemed to match what practitioners are describing to us as the Holy Grail: the ability to collect and integrate pertinent risk, position and market information into a single point of contact for risk management.

So what went wrong?

The Report to Creditors and Members issued May 30 makes for interesting reading.

Hyper Rig was in fact the marketing vehicle for CKlear, owned by Hyper Rig CEO Michael Coleman, which held the intellectual property for the risk aggregation platform. The company began trading in 2009 and managed to generate profit of £150,000 on revenues of more than £800,000 for fiscal 2010.

Despite the termination of a contract with Barclays Capital in late 2010, the firm secured paid-for trials at Credit Suisse, Deutsche Bank and Royal Bank of Canada, among others, with the prospect of some £2.5 million of revenue.

Based on this interest, the company embarked on a fund raising exercise in 2011, with commitments of between £1 million and £2 million, contingent on closure of a platform sale to one of the these prospects. According to the report, due to the ongoing problems in the Eurozone, budgets among triallists were frozen until February 2012 at the earliest.

Having struggled through 2011, the firm managed to gain interest from Royal Bank of Canada, which at the beginning of this year looked set to commit to a £800,000 contract. Moreover, an investor had also announced plans to deploy the system along with two of its customers.

Things were looking rosy, but a dispute among the shareholders – a minority shareholder sought to liquidate his holding – led to a statutory demand being served on the company in April. Funding and client interest unravelled from there.

That a shareholder dispute could lead to the downfall of a provider of a mission-critical function like risk aggregation speaks to the broader issue of scale. Financial institutions – today more cautious than ever – are nervous of buying from smaller players, no matter how visionary.

No-one got fired for buying IBM, as they say, and the curse of the ‘approved supplier’ list hits smaller, innovative companies everywhere. Hyper Rig seems to have paid the ultimate price.

Subscribe to our newsletter

Related content

WEBINAR

Recorded Webinar: How to leverage data lineage for actionable business insights

Data lineage is a must-have for financial institutions, but is it being used to its greatest extent, and is it delivering actionable business insights that inform product development and support competitive advantage? This webinar will address these questions, looking first at the status quo of data lineage across capital markets, and moving on to discuss...

BLOG

SmartSearch Sets Growth Plans Following Investment from Triple Private Equity

SmartSearch, a UK provider of digital compliance and anti-money laundering (AML) software, has received a large investment from Triple Private Equity. The private equity firm will gain a majority share in SmartSearch and work with the company to support its core markets and continued expansion following the release of its latest technology platform last year....

EVENT

AI in Capital Markets Summit London

The AI in Capital Markets Summit will explore current and emerging trends in AI, the potential of Generative AI and LLMs and how AI can be applied for efficiencies and business value across a number of use cases, in the front and back office of financial institutions. The agenda will explore the risks and challenges of adopting AI and the foundational technologies and data management capabilities that underpin successful deployment.

GUIDE

Regulatory Data Handbook 2023 – Eleventh Edition

Welcome to the eleventh edition of A-Team Group’s Regulatory Data Handbook, a popular publication that covers new regulations in capital markets, tracks regulatory change, and provides advice on the data, data management and implementation requirements of more than 30 regulations across UK, European, US and Asia-Pacific capital markets. This edition of the handbook includes new...