Browser-based algorithmic trading platform Quantopian announced this morning it has raised $6.7 million in Series A funding. The round was led by West Coast venture capital firm Khosla Ventures and existing investor in Boston, Spark Capital. With a new flood of financing in the bank, Quantopian plans to continue to enhance its cloud platform, empower company growth and bring more users or "quants" into its e-trading community.
"Quants," as BostInno explained at the company's launch in January 2013, are the "the math geeks turned lords of finance that have become one of Wall Street's most valuable commodities," precisely because they are typically the ones crafting the elaborate trading algorithms that drive the market. However, only 10,000 quants make it to the Big Leagues on Wall Street – a number Quantopian believes is limited by extremely high barriers to entry, i.e. hedge fund backing and/or a bio full of years spent securing data and programming a custom solution to back-test algorithms.
The company hopes to break down the barriers for quants and make them investors by giving them access to Quantopian's platform for creating algorithms, along with unrestricted access to trading data for back-testing algorithms and a connection to market execution.
"We’re lucky to be in Boston where we have both an active quant community and a vibrant and supportive start-up ecosystem. The funding we’ve received sets us on a path of continued expansion – in terms of the features, data and asset classes we support and our ability to package quantitative strategies in new ways to allow more and more people to access and benefit from them," John 'Fawce' Fawcett, founder and CEO of Quantopian, told BostInno.
In May, Quantopian launched its live trading in beta, and has since hit 10,000 users. Additionally, the startup brought on former Thomson Reuters executive Jessica Stauth as VP of Quant strategy.
"Quantopian is building a strong community of smart people, and it takes a robust technology platform to do so. Quantopian is changing the structure of the quantitative finance by connecting individual investors with unprecedented access to data and the infrastructure to put it to use," Andrew Parker, principal at Spark Capital, said in the release.
Quantopian raised around $2.1 million in seed back in January; this round brings the company's total funding to $8.8 million, according to the company's statement. The Quantopian team includes a number of veterans from local content marketing leader HubSpot, including Dan Dunn, VP of product and community, and CTO and cofounder Jean Bredeche.
