JPMorgan Chase buys fintech Aumni in push to earn venture capital

JPMorgan Chase is buying a provider of data analytics for startup investors called Aumni, CNBC is the first to report.

The largest U.S. bank by assets is buying the five-year-old Utah-based company as part of a broader push to deepen relationships with venture capital investors and their companies, according to Michael Elanjian, who heads JPMorgan’s digital private markets initiative.

Although terms of the deal were not disclosed, JPMorgan is paying roughly what the startup was valued at at its last fundraising in 2021, according to a source. Aumni was worth $232 million after that round, according to Pitchbook.

The deal is the latest in a series of fintech acquisitions made under CEO Jamie Dimon. Since 2020, JPMorgan has acquired half a dozen startups to bolster its capabilities in areas from payments to ESG investing. The company’s technology investments have recently come under scrutiny amid the bank’s rising expenses and a fierce legal dispute over a 2021 acquisition.

JPMorgan decided to buy Aumni after leading its investment round in 2021, Elanjian said. Founded in 2018 by Tony Lewis, a former corporate lawyer, Aumni is a data platform that helps users analyze and understand their holdings via a single dashboard.

Most of the VC industry still uses Microsoft Excel or similar products to track investments in portfolio companies, which can make it difficult to gain insight into their holdings, Lewis said. That’s because contracts underpinning a single equity round can exceed 600 pages of dense legal writing, he said.

“The moment you want to start doing any kind of data science inquiry into your existing investment activity, it becomes a really big task to accurately track down that information, put it into Excel and do the work,” Lewis told CNBC over Zoom.

“This is a problem for anyone investing in any private alternative asset; it’s based on a private contract, that’s where your financial and legal rights lie,” he added.

Investors piled on Aumni in recent weeks after the collapse of Silicon Valley Bank sent shockwaves through the startup community, according to Lewis. Because of concerns over uninsured deposits in mid-sized banks, VCs suddenly wanted to know where their portfolio companies banked and whether they had legal rights to inspect their financial books, he said.

In other cases, VC investors can use Aumni to avoid errors related to missing key details buried in legal documents.

The startup has data on nearly 18,000 portfolio companies valued at $3.6 trillion, Lewis said. It charges an annual subscription fee based on assets under management and the number of companies tracked, he said.

The service will be integrated with JPMorgan’s private markets platform Capital Connect, which came out of stealth mode last year, Elanjian said. It also complements the bank’s acquisition last year of Global Shares, a software provider for managing employee share plans.

The broader goal is to become the digital destination for VCs, startup founders and other investors to raise money, network and tap loans, he said. Capital Connect now has 200 employees and around 850 customers, he said.

“We want to be the end-to-end ecosystem provider to the venture community and the private markets,” Elanjian said.