This content is from: Corner Office
This Carlyle- and Blackstone-Backed Fintech Firm Wants to Replace ‘Antiquated’ Alternative Investing Technology
“In many cases, people have no technology solution for what Canoe solves today,” said Eric Hanno, managing director at AlpInvest Partners.
Canoe Intelligence, a financial technology firm that started within a private investment firm in 2013, on Thursday announced its completion of its extended Series A round of financing. The financing round was led by major alternative investment management firms (and Canoe clients) Carlyle Group and Blackstone Innovations Investments.
The original Series A round included investments from Nasdaq Ventures and Hamilton Lane, among other alternative investment firms. Canoe said the influx of funding will allow it to further develop its current platform and expand its suite of products, which work toward the greater automation of investment workflows.
For its clients, including major institutions like Carlyle, Blackstone, and, most recently, State Street, the successful fundraise means the promise of improved products and, as a result, a competitive edge against other firms with more antiquated data processors.
“The existing technology suite within alternatives is in general antiquated,” said Eric Hanno, managing director at AlpInvest Partners, a private equity manager within Carlyle. “In our effort to be an industry leader in technology, we want to adopt these emerging technologies, and we also want to invest in and become a strategic partner to them. By investing in tech businesses we are able to both help fund their growth and help set future product development initiatives.”
According to Thursday’s announcement, both Carlyle and Blackstone have improved the efficiency of internal processes like data collection and extraction since becoming Canoe clients. As a result, both firms felt it was mutually beneficial to form strategic partnerships with the fintech company.
“By being an investor with a board seat or as a board observer, we believe we will be in a better position to help shape product development,” Hanno told Institutional Investor. “And ultimately, as a large global private equity investor, we look forward to using our expertise to help shape a better solution for the broader alternatives industry.”
As the alternative investment space continues to grow, Hanno said there is still plenty of opportunity for product development in fintech. For example, Hanno said Carlyle still has manual processes for tasks like filing tax forms and working through quarterly financial statements.
“In many cases, people have no technology solution for what Canoe solves today,” he said. “And there are many use cases where we hope technology solutions can replace manual processes and we are excited to explore this further.”