InvestCloud eyes IPO to become wealth tech platform of choice.
For today’s digest, InvestCloud is considering an IPO that could value it at up to $10 billion to fulfill its goal of becoming a global platform. InvestCloud offers a comprehensive set of wealth tech services via four sub platforms. These sub platforms include wealth advisors, private bankers, financial supermarkets, and customizable financial platforms. Unsurprisingly, InvestCloud has had a record year supporting wealth managers’ digital transformation. About 85 percent of business leaders across a range of wealth management firms reported last year that partnering with third-party providers was important. As a result, InvestCloud reached a $1 billion valuation in February and now has more than $4 trillion in assets on its platform. Revenues, meanwhile, have surpassed $285 million and are projected to reach $400 million next year.
Why an IPO? While Investcloud hasn’t made a decision yet, an IPO could be its best bet to take on competitors globally. InvestCloud has made clear its plans for global domination, ramping up operations in European and Asian markets over the past year. Having that said, it faces large peers that also offer all-encompassing solutions and are backed by significant capital. For example, Enfusion went public last month priced at $1.9 billion, highlighting market appetite for such solutions. And IHS Markit, which is owned by S&P Global, just unveiled a digital onboarding solution for fund managers. Early-stage wealth tech firms are also raising record private funding, which could pose new threats to established vendors. As such, an IPO would be an effective way for InvestCloud to draw the necessary capital to expand its product suite globally and remain competitive.
