Banking

Wells Fargo is looking to hire a lead investor focused on trading-tech startups to keep pace with a surging market

  • Wells Fargo Strategic Capital adding a lead investor to run a team focused on trading tech.
  • The role will sit within the principal technology investing group in Wells Fargo Strategic Capital.
  • Thomas Richardson, an MD at Wells Fargo Strategic Capital, told Insider about the hiring plans.

Wells Fargo Strategic Capital is on the lookout for a new lead investor. 

An influx of investments made by the group in startups underpinning capital markets — from back-end trading to data analytics — is prompting Thomas Richardson, a managing director at Wells Fargo Strategic Capital, to build out his ranks.

Capital markets is the busiest investment vertical for Richardson’s principal technology investing (PTI) group in terms of deal activity and investments under review, he told Insider, with three of them currently live. 

In a shift from earlier this year, activity in the sector is outpacing PTI’s other two tech-focused arms: fintech (which includes payments,

digital banking
, treasury management, AI, and machine learning, and infosec) and proptech (which includes tech relating to real estate, insurance, logistics, and business process automation).

“We’ve put a decent amount of capital into the other two sectors, and right now capital markets is where we are seeing the most active deal flow,” Richardson said.

Wells Fargo Strategic Capital launched in 2018 with the goal of standardizing and deepening the sort of tech and industry investments the bank had been making since the late 1990s, Richardson said. With Strategic Capital came Richardson’s technology focused team, PTI.

“If there’s going to be an investment in a technology company made by Wells Fargo, it’s going to come through PTI,” he added. 

While no official job posting has yet been listed, adding a capital markets investment lead would solidify the group’s executive structure. Richardson currently heads both PTI and capital markets investing. The role would join the other two heads overseeing the fintech and proptech arms and report to Richardson. 

Strategic Capital has added talent in “most of our sectors,” according to Richardson, and the group plans on hiring across verticals throughout this year.

PTI has made 35 investments across fintech, proptech and capital markets

Richardson’s background prepared him well for these sort of investments. He previously spent 12 years at Citi, ultimately managing a team of about 50 equities traders and heading up market structure, and two years as president of the Boston Stock Exchange until its acquisition by Nasdaq. 

PTI is invested in about 35 names with an average check size of roughly $10 million. Richardson said that’s set to grow as the group matures.

Investments also often lead to commercial deals with the bank, and vice versa, he added. 

Wells Fargo Strategic Capital recently co-led Vestwell’s $70 million Series C fundraising round alongside Fin VC, a deal that also saw participation from other banks like Morgan Stanley and Goldman Sachs.

In May, Wells participated in a $150 million round in Forge, a stock market for private tech companies, where Richardson also joined the board. And in 2020 it participated in a $65 million round for startup stock exchange MEMX.

Richardson said he’s seen this type of industry activity before, and it’s underpinning the group’s investment focus area. 

“There’s the private market space that’s very active and that looks to me very similar to what I went through when I first started doing this way back at Citigroup,” he said. A good amount of capital was flowing into privately held electronic communication networks and alternative trading systems that eventually became exchanges, he added.

“The same thing is sort of true today where companies, for a variety of reasons, are staying private longer,” he said, and it’s created a need for investors, LPs, and insiders to have a vehicle to sell their stock, and those companies are out looking for capital.

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