Quantopian, once one of the most heralded financial services technology startups in Boston, will soon cease operations, with its co-founders and some employees joining Silicon Valley-based financial app maker Robinhood Markets Inc.
Quantopian announced late last month that effective Nov. 14, it would shut down its community platform on which amateur investors could create investment algorithms that the company could license to use in a fund of its own. It gave no reasoning for the move. Some of the platform’s users lamented the suddenness of the closure.
Then late last week, the firm said that its employees would join Robinhood, the firm known for its eponymous app that allows users to trade stocks for free.
Neither a Quantopian blog post nor a Robinhood statement framed the moves as part of a Robinhood acquisition of Quantopian. Instead, the companies said Quantopian employees would join Robinhood.
Quantopian CEO John Fawcett directed questions about the moves to a Robinhood spokesperson. Asked if an acquisition had occurred, the spokesperson said that terms of the deal had not been disclosed.
The Robinhood spokesperson said “several” Quantopian employees, making up a majority of Quantopian’s headcount, would join Robinhood’s product and engineering teams later this month. They include Fawcett and his co-founder, Quantopian Chief Technology Officer Jean Bredeche. The spokesperson declined to give an exact number of employees. Some of Quantopian’s key employees, including two managing directors, left the company earlier this year, according to their LinkedIn profiles.
The moves mark the end of a fintech firm that attracted investments from some of the biggest names in venture capital. Founded in 2011, Quantopian raised $49 million from Silicon Valley firms like Andreessen Horowitz and Bessemer Venture Partners as well as Point72 Ventures, a firm funded by the hedge fund titan (and New York Mets owner) Steven Cohen. Cohen even pledged to give Quantopian up to $250 million of his own fortune to manage.
But soon after Quantopian began trading using the algorithms devised by its platform members in 2017, the Wall Street Journal reported that it was generating lackluster returns and that its chief investment officer had left the firm.
In the years that followed, the firm made a number of changes to its operating model, including by building up its offerings to other investment firms. Most recently, just before the pandemic hit the U.S., it shut down its original, market-neutral investment strategy after it underperformed for years in order to pivot to a broader set of strategies. The move necessitated the return of Cohen’s money.
Both Fawcett and the Robinhood spokesperson declined to comment on what Quantopian team members will work on in their new roles. The two firms share some financial backers, including Andreessen. Their relationship goes back years: In 2015, Quantopian become one of the first companies to offer Robinhood’s brokerage services other than Robinhood itself.
In the blog post last week, Fawcett wrote that the Quantopian team would work “to further expand access to financial information and education, and inspire greater participation in the financial markets.”
In its statement, Robinhood said it was “excited to welcome several incredible members of the Quantopian team… and (looks) forward to working together to achieve our vision of a financial system that continues to remove barriers and provide everyone with greater access to financial information.”
