JPMorgan buys investment research fintech Aumni

Dive card:

• JPMorgan Chase has agreed to buy Aumni, a Salt Lake City-based investment analytics fintech, the bank announced Wednesday.
• The deal, which is expected to close by June, marks the latest fintech acquisition for the $3.7 trillion-asset bank, which continues a acquisition party it accelerated in 2021.
• JPMorgan did not disclose the value of the deal, however Aumni was worth $232 million after its latest funding round in 2021, according to Pitchbook. It is in line with what the bank will pay, a source with knowledge of the transaction told CNBC.

Diving Insights:

JPMorgan is strengthening its investments in services aimed at early-stage private companies.

The bank last year launched Capital Connect, a platform that aims to pair startup founders with venture capital investors. JPMorgan also bought Global Shares last yeara cloud-based provider of share plan management software.

Aumni tracks and analyzes legal and financial terms underlying growth stage private market transactions.

JPMorgan first invested in the startup in 2021, and that deal helped the bank realize the two firms shared synergies to bring more transparency to private markets, Michael Elanjian, JPMorgan’s head of digital investment banking and digital private markets, said in a statement.

“Aumni’s market-leading data structuring and portfolio monitoring solutions, combined with the capital raising and cap stack management services of Capital Connect and Global Shares, further enhance the ecosystem of digital solutions that JP Morgan is building for companies and investors in both growth and later-stage private markets,” Elanjian said.

Aumni has data on nearly 18,000 portfolio companies valued at $3.6 trillion, the startup’s CEO, Tony Lewis, told CNBC. Fintech charges an annual subscription fee based on assets under management and the number of companies tracked, he said.

Wednesday’s deal follows up on a 2020 promise from JPMorgan CEO Jamie Dimon that the bank would be “much more aggressive with acquisitions across the board.”

But regulations prohibit the bank from acquiring more US-based deposit-taking institutions because it already has more than 10% of US deposits. So it has taken to investing in businesses that are bank-adjacent – or completely outside banking.

JPMorgan made more than 30 acquisitions in 2021, Reuters reported. That includes buying foreign entities such as UK digital wealth management platform Nutmeg and buying significant stakes in Greek fintech Viva Wallets and Brazilian digital bank C6.

But the bank has also bought businesses that are completely outside banking – with varying degrees of success. In September 2021, JPMorgan bought the restaurant platform The Infatuation, as owner Zagat guide book.

In the same month, it also acquired the university’s financial planning platform Frank. The bank shut down that platform in January and is embroiled in a legal battle with Frank’s founder, Charlie Javice. JPMorgan alleges that Javice greatly exaggerated Frank’s client base and created fake student accounts to back up her claims.

Javice, for her part, countersued, alleging the bank fired her to avoid paying her a $20 million bonus.