Motive Insights

By Motive Partners

Motive Insights - July 2022 Industry Roundup

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July 31 · Issue #304 · View online
Motive Insights
NEWS FROM THE MONTH OF JULY
What our team of Investors, Operators and Innovators have been up to over the last month
To many, Motive has become known for our ‘edge’ – our integrated model of bringing together a powerful patchwork of investing, operating and innovating capabilities to invest in the financial technology opportunity. We believe that this enables us to provide transformational capital to our portfolio company partners that truly changes the trajectory of these companies in partnership with their management teams.
Our most recent case study of the Motive model in action was the closing of our acquisition of BetaNXT, on which we partnered with Clearlake to carve out the BETA+ assets from the London Stock Exchange Group. Our team of investors, operators and innovators have been working on this transaction for over two years as a critical piece in the execution of our wealth management thesis.
Want to know more? The piece below has been written by our team of investors, who worked on the deal. Here’s why we decided to invest in BetaNXT:
Motive Partners agrees to acquisition of BETA+ from London Stock Exchange Group
On July 1st, we completed our acquisition of the BETA+ assets (composed of BETA Post-trade Processing, Maxit, and Digital Investor) from the London Stock Exchange Group (“LSEG”). Going forward, the company will collectively operate as BetaNXT, reflecting its evolved strategic vision and its role as the next pivotal piece in Motive’s execution of its bold investment thesis in the wealth management sector.
Since 2018, Motive has been constructing a front-to-back-office wealth management ecosystem to effectively serve our portfolio companies’ customers, their advisors and end-clients. The combination of our Finantix and Tegra118 assets under the InvestCloud umbrella in 2021 (including the add-on acquisitions of RetireUp and Advicent along the way) heralded a premier front- and middle-office wealth management platform. Our investments in Wilshire and FNZ continued to leverage our firm’s deep expertise in the space, strengthening our portfolio in the industry. And finally, the acquisition of BetaNXT bolsters this platform through the addition of an infrastructure-like back-office platform allowing wealth management firms to transition to a self-clearing model.
BetaNXT’s core post-trade processing business has a loyal customer base and generates strong cash flows to support our multifaceted value creation plan (“VCP”). The BetaNXT solution set also includes cost and tax basis reporting, advisor tools, and investor portals, further supplementing our wealth ecosystem’s front office offerings. In addition, Motive and Clearlake formed a long-term strategic partnership with LSEG, through which LSEG will work hand in hand with BetaNXT and Motive and Clearlake’s wealth management portfolio companies, including InvestCloud, to provide content, data, and tools.
We believe that this transaction exemplifies Motive’s core strengths and significant value proposition. Teams from across the Motive platform – investors, innovators, and operators – came together over the last two years to bring this deal across the finish line:
Motive Create (innovators) collaborated with our Industry Partners (operators) and Investment Team (investors) to construct a comprehensive VCP detailing our strategy to transform the asset through technological modernization, M&A, functionality, and total addressable market expansion, and partnerships with the broader Motive wealth ecosystem. The Motive Create team also conducted detailed technology diligence to deliver actionable enhancements, some of which may be accelerated through the partnership with InvestCloud and are expected to deliver significant value to BetaNXT and its clients.
Our Industry Partners were actively involved in conceptualizing the value creation plan during the diligence process and standing up the business after signing. Going forward, industry legend Stephen C. Daffron (Co-Founder & Industry Partner at Motive), has stepped in as Chairman and Chief Executive Officer of BetaNXT to lead the company in the execution of the evolved vision, leveraging his vast operational and carveout experience from the turnaround of Motive portfolio company Dun & Bradstreet (exited in January 2021) and, prior to that, Interactive Data Corporation. Steve is joined by Caroline O’Connell (Industry Partner at Motive Partners) as Chief Administrative Officer, amongst other executive hires and talent deployments.
In conclusion, through attractive M&A to augment the platform and catalyze growth acceleration, technology improvements, and TAM expansion, we believe we will create value for BetaNXT’s customers and our investors. A tremendous amount of thoughtful work over the last couple of years has been the driving factor to support our conviction in this asset. But the real work is just beginning. We are confident that Steve and the BetaNXT team, supported by our Industry Partners, the Motive Create Team, the Investment Team and the BetaNXT board, will execute, and continue Motive’s transformation of the wealth management sector at a critical time for the industry. Our success will be achieved through working tirelessly to ensure the continued stability and high-performance of this storied platform while bringing in the right doses of innovation and transformation that defines the Motive approach.
This piece was authored by:
Other Motive News
Motive Partners raised $2.5 billion for Motive Capital Fund 2 and affiliated co-investment vehicles
In July, we announced the final close of Motive Capital Fund 2. This fundraise supports our mission to build a leading fully integrated private equity firm focused on technology-enabled financial and business services industries. Read our press release here and further coverage from Bloomberg News’ William Louch here.
Rob Heyvaert, Founder & Managing Partner at Motive Partners, commented:
“We are deeply grateful for the support from our existing investors and are delighted to welcome a roster of new partners to the Motive family - thank you for your trust. We will continue to be laserfocused on partnering transformational capital with world-class management teams.”
Bob Brown, Founding Partner & Head of Investor Relations, commented:
“We greatly appreciate the support of such an esteemed and diverse group of investors, and we take seriously the responsibility that our investors have bestowed upon us. We continue to invest into our distinct operating capabilities, allowing us to identify attractive investment opportunities and support our portfolio companies in the next stage of their growth.”
To honour the milestone, Rob and Bob reflected on the fundraising journey and our responsibility ahead in an episode on the Motive Insights Podcast. Tune in here to hear more.
Motive Podcasts
Out on Friday on the Motive Insights Podcast, Sam Tidswell-Norrish (Managing Director, Motive Partners) spoke with Jouk Pleiter, Founder & CEO of Backbase, our most recent investment. Jouk has been building Backbase for nearly 20 years to become a market leader in engagement banking, known the world over. Nearly two decades in and having not taken investment until now, we spoke about ‘Why now’, ‘Why Motive?’ and ‘What next?’…
And to round it off, we were joined by Motive investment & innovation experts, Andrew Tarver (Founding Partner & Head of Motive Create) and Swathi Vankayalapati (Senior Associate, Investment Team) to dive a little deeper on the space at the end of the episode! Tune in here.
PORTFOLIO COMPANY NEWS
What our portfolio companies have been up to over the last month
  • CAIS was recognized as a finalist in three categories for the 2022 ThinkAdvisor LUMINARIES Awards. CAIS was named as a finalist for the Diversity, Equity, and Inclusion Firm Award along with the Thought Leadership and Education Award, in recognition of CAIS IQ, CAIS’ industry-leading learning system. In addition, CAIS’ CEO, Matt Brown, was named a finalist for the Executive Leadership Award. These awards honor individuals and firms that are taking creative steps to push the industry and clients’ best interests forward.
  • FNZ announced that it acquired Swiss private banking technology company New Access – an FNZ company. The award-winning private banking digital solutions and talent of New Access will further enhance FNZ’s ability to serve the global wealth management industry and accelerate our mission of opening up wealth.
  • GVC Gaesco and FNZ announced their partnership to support GVC Gaesco’s digital transformation strategy and to accelerate FNZ’s expansion into Spain.
  • FNZ announced its partnership with Aviva on the ESG Profiler tool, furthering their collective ambitions around sustainable investing together. The partnership and the enhancements to this first-to-market tool, powered by FNZ Impact, is the next step for both companies in facilitating sustainable and responsible investing solutions for the Financial Services market.
  • All eyes continue to be on private market valuations as new downturns provide fresh insight on current market conditions. These reductions grab headlines, but are they high-profile outliers or leading indicators of more discounts to come? Read Forge’s latest Private Market Update here to see what new data may seem to suggest for the current market!
  • How will companies encountering a closed IPO window fare in the new market realityBlythe Masters, Founding Partner of Motive Partners and CAIS Board Member, shares her insights in this Private Market Update Webinar recap.
  • Rabobank selected InvestCloud to bring digital financial planning to all their customers – from private banking to retail clients. John Wise, InvestCloud’s CEO, said “Rabobank shares our belief that everyone should have access to a financial plan, no matter their level of income. We’re thrilled to be partnering with them, helping further their bold ambitions to digitize client services and support millions in the Netherlands to better plan and invest in their futures and to achieve their life goals.”
  • LPA announced the promotion of Susan Niederhöfer to Head of Sales and the appointment of new joiner Andreas Pade as Head of Product Asset Management.  Susan joined LPA in 2017, bringing a wealth of experience from her career at Commerzbank, where she held several positions. Andrew joins LPA with an extensive 20 years of experience in the financial industry, specifically within asset management, fund administration and banking. 
  • Trumid collaborated with AWS Machine Learning Solutions Lab to develop advanced machine learning systems to personalize the credit trading experience. Read this blog featuring Mutisya N., Head of Data Strategy and AI at Trumid.
  • Wilshire held its Second Quarter Market Update webinar. Follow the link to watch the replay.
  • Wilshire was thrilled to announce that Cloudwall, a digital asset risk specialist, is integrating Wilshire’s pioneering Digital Asset Taxonomy System as part of the Cloudwall Serenity platform to help classify and group over 1,000 digital assets. Over time, Serenity will help investors understand market, liquidity, credit, operational and other risks both at the level of individual assets and whole sectors. Learn more here.
INDUSTRY NEWS
What we found interesting this month
From saving to spending: A second front emerges in the US retirement challenge
Crypto prices rise as traders dip back into digital asset market
Ant Group IPO set for further delay as Jack Ma plans to give up control
Billionaire CEO Seeks to Reset Fintech Pioneer After IPO Fiasco
Lloyds CEO Says Bank Will Look Into More Fintech Acquisitions
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