J P Morgan derivatives services spin-off, Cygnifi has announced the close of a $22.3 million first round of financing. In addition to the LabMorgan e-finance unit, other investors include Sybase, derivatives analytics company NumeriX Corporation, and Gamma Investors, an early to mid-stage venture capital firm. Bridge Information Systems has also signalled its intention to invest in this round.
Cygnifi intends to offer derivatives risk management capabilities using the application service provider (ASP) model, to traders, asset managers, risk managers, corporate treasurers, and other professionals. Covering both market and credit risk, Cygnifi's online tools and services for pre-trade pricing, independent portfolio valuation, counterparty credit, and collateral risk management will be rented to customers via subscription.
"Cygnifi demystifies the derivatives marketplace, offering easy access to sophisticated analytic risk management capabilities and on-demand expertise to larger financial and corporate institutions and many smaller, less sophisticated end users," says Jay Helvey, chairman and CEO of Cygnifi. "Cygnifi is the first independent company to provide simple access to high-end risk services that unlock Wall Street's proprietary analytic capabilities and expand this complex trading market to a broader range of users."
The investment will be used to build the company's technology infrastructure and staff.
Founded in February 2000, Cygnifi's management team comprises chairman and CEO Helvey, a one-time vice chair of Morgan's risk committee and global head of derivative counter-party risk; and president and COO Vlad Torgovnik, the former head of derivatives information technology at Morgan. The company is headquartered in New York City, with additional operations in London and Tokyo.