Sam Hocking left Wall Street to bring investors and hedge funds together with iMatchative’s AltX
7/6/2015 - Editor's Note: In the Start Me Up series, the Kellogg School spotlights members of the Kellogg community who are bringing bold entrepreneurial visions to life.
Sam Hocking ’04 (EMP-57) believes he has found the right match for you. Investment match, that is.
In October 2012 Hocking launched iMatchative, a finance company that uses science and technology to improve investor decision-making.
The San Francisco-based startup’s flagship product, AltX
(short for alternative exchange), melds algorithms, behavioral finance, social profiling and traditional analysis into one online search and monitoring engine. Creating an innovative cloud-based “meeting place” for capital allocators and hedge fund managers, AltX streamlines the process of connecting the right investor to the right funds.
In a crowded marketplace, performing due diligence can become a daunting task. AltX features more than 16,000 hedge funds on its platform. For a $30,000 licensing fee, investors can easily peruse the latest fund information — from strategy to performance to details about managers — based on the criteria they choose. Hedge funds pay half that sum to be “introduced” and seen.
“Investors go through a tremendous amount of time and effort figuring out the best match for their portfolio needs,” says Hocking. “We want to help them take a huge ocean of funds and boil it down to the potential groups that best fit them on many different levels.”
Unmatched in its uniqueness, iMatchative has found a good fit with its own investors, including Carlos Slim, who sits on The 2015 Forbes Billionaires List, Wells Fargo and TPG Capital co-founder David Bonderman. The 55-plus employee company raised $20 million in Series B financing late last year and has plans for global expansion in the coming months.
“What you can do in the digital world"
Hocking hatched the idea in 2012 while he was overseeing global sales for BNP Paribas’ Prime Brokerage Unit. No stranger to the flow of capital from investors to hedge funds, this finance industry expert wanted to transform the somewhat labor intensive and potentially hit-or-miss process—but how?
"My eyes opened to what you could possibly do in the digital world to introduce the two groups.” So Hocking kicked around the idea of an online searchable service for investors with professors of physics and engineering — neither of whom had a clue about finance but they were enthralled with Hocking’s vision.
“They were perfect,” says Hocking of his now iMatchative advisers. “When you only have domain experts, the thinking tends to be constrained rather than innovative. You don’t push yourself to come up with crazy new ideas.”
Hocking quit his job on Wall Street to pursue his big “crazy” idea. He started his company at his home base in San Francisco and nearby Silicon Valley and began by building a diverse team of scientists, engineers and business professionals with hedge fund, prime brokerage or investor experience. To further explore and expand on his iMatchative concept, Hocking liberally tapped into his Kellogg connections, including Kellogg professors who could provide expertise in game theory and pricing.
“It’s great going back to school when you’re older because you have almost a peer relationship with faculty members,” says Hocking. “You learn from them, they learn from you and we can ultimately work together to create something unbelievable.”
His first hire and chief science officer is a clinical and organizational psychologist who specializes in the behavioral dynamics of financial decision-making. And one of his earliest backers was Kellogg alumnus Jeff Ubben ’87
, founder, CEO and CIO of ValueAct Capital, an investment company headquartered in San Francisco. Before they became fellow Kellogg alumni, Ubben was formerly Hocking’s client.
Starting up... again
Hocking is no stranger to changing course, having worked as a foreign correspondent, a college journalism teacher and managing director in international finance. Though, with 25 years of working diverse jobs in locations around the globe, he admits that leaving a large company with a myriad of resources was at first overwhelming. Fortunately, his Kellogg experiences, education and network propelled him forward and make him feel less alone as an entrepreneur.
Says Hocking: “What Kellogg does exceptionally well is reinforce the importance of collaborative work and finding people who cheer you on and help you achieve your goals.”
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