In these days of lean research budgets, it’s hard to find a brokerage chief willing, much less eager, to expand his firm’s analyst ranks. Lee Olesky, the London-based president of TradeWeb, is a conspicuous exception. In fact, one of the primary reasons that his electronic bond-trading platform recently sold out to Canada’s Thomson Corp. for $385 million was so it could hire fixed-income researchers and capitalize on the big media and database company’s analytics and news services.
“We have 1,500 institutional investors signed and more than 13,000 sets of eyes looking at our screens,” boasts Olesky, 42, a former CSFB and BrokerTec executive. “That is an incredible customer base. Execution is fundamental.” But, Jersey City, New Jersey-based TradeWeb “can do a lot more,” he contends, by adding research services that generate trading interest.
Olesky has seen the drawing power of bond data: Bloomberg relied on its news, analytics and research operation to help sell its bond-pricing system. TradeWeb, which handles more than $85 billion in bond trades a day, plans to use its augmented research capabilities to tighten its hold on existing customers, bring in new ones and peddle its other services.
Olesky takes pains, however, to explain that he doesn’t trust research by itself to lure customers out of the blue. “One place I would not want to be strategically is sitting with a huge research cost base at an integrated investment bank and not knowing what to do with it,” he observes.
