Mdotm, a start-up providing AI-based investment solutions for asset management firms, has announced that it has closed a $27 million funding round led by Expedition Growth Capital.
Founded in London in 2015, Mdotm has grown to become one of the leading providers of artificial intelligence for the investment sector, working with major financial institutions, including Morgan Stanley, Amundi and Zurich Bank. The company now serves over 60 financial institutions in the United States, the United Kingdom and Europe, at a time when firms are increasingly relying on artificial intelligence to manage the complexity of portfolios on a large scale, with Sphere supporting over $100 billion in assets under management.
The total investment in the company now stands at $36.5 million. As part of this funding round, new seats on the board of directors have been allocated to Steve Twomey, a partner at Expedition Growth Capital, and James Hays, chairman of IFC Advisors. Hays was previously CEO of Wells Fargo Advisors and has nearly 40 years’ experience in the sector. The new members join CEO Tommaso Migliore, chief scientist Federico Mazzorin and chief operating officer Federico Invernizzi. The investment will accelerate the global expansion of Mdotm’s Sphere artificial intelligence platform and support a significant increase in recruitment across AI research, engineering, product development, sales and client solutions, in response to growing demand for scalable AI from financial institutions.
Asset managers are having to cope simultaneously with falling fees and growing demand for personalisation, and hiring more investment professionals is not a scalable solution. At the same time, the growing number of investment opportunities and the proliferation of AI-driven insights are making portfolio management increasingly complex, requiring firms to manage a greater number of inputs, constraints and decisions across thousands of portfolios.
To help companies tackle this complexity on a large scale, Mdotm has developed Sphere, its proprietary AI-powered investment platform designed for wealth management.
Designed for human-AI collaboration, Sphere analyses market and macroeconomic data to identify market regimes and provide forward-looking insights across all asset classes, whilst enabling investment teams to incorporate their own market views and convictions. These are then translated into portfolio construction and rebalancing tools, enabling users to create, customise and manage portfolios at scale. Sphere’s generative AI capabilities further support investment teams by automatically generating personalised portfolio commentary and reports for clients.
“The result is an end-to-end investment workflow that offers operational intelligence and scalability to teams managing thousands of portfolios simultaneously. Asset managers are no longer asking whether to use AI in investment decisions, but how to implement it at scale across thousands of portfolios whilst retaining control. Sphere was created precisely for this purpose, which is why leading financial institutions are already using it in production. This investment will help us expand our team and meet the growing demand in the US and European markets,” said Tommaso Migliore, CEO of Mdotm, in a statement.
The platform is backed by a team of over 60 data scientists, engineers and finance experts, with the support of Mdotm Lab, an academic network of over 20 professors and PhD researchers conducting research at the intersection of machine learning, portfolio management, behavioural finance and AI ethics.
“Over the past ten years, financial institutions have invested in back-office and front-end software, but the work in between is still carried out on spreadsheets: rebalancing, aligning portfolios with the firm’s strategies and generating client reports. Mdotm has created the artificial intelligence infrastructure that finally enables this work to be scaled up, with the transparency and governance required by institutional investors,” says Steve Twomey, a partner at Expedition Growth Capital.
ALL RIGHTS RESERVED ©
