Originally published on Trading Tech Insight
Eventus, the trade surveillance and financial risk solutions vendor, is currently experiencing a strong growth phase, marked by nearly perfect customer retention rates, expansion across various asset classes and geographies, and consistently positive reviews of its platform. The company, which just reported a 25% increase in its client base over the past year, has recently onboarded several new clients, including three tier-1 banks utilising its Validus platform to achieve various compliance and regulatory objectives. With the recent signing of its first South African client, Eventus now operates across six continents, demonstrating its growing global influence.
Recent accolades for the company include being named Best Trade Surveillance Solution at A-Team Group’s TradingTech Insight USA Awards 2024, following similar recognition in the Asia-Pacific region at the 2024 RegTech Insight Awards APAC. Eventus has now accumulated six A-Team Group awards over the past five years, including two RegTech Insight Europe Awards.
In this Q&A with TradingTech Insight, Eventus CEO Travis Schwab elaborates on the factors driving the company’s continued growth and success.
TTI: Travis, congratulations on your recent award wins and your new signings. Your client base has now grown by 25% over the past year. Can you elaborate on the factors driving this growth?
TS: It’s a combination of factors, some of which are new and some are ongoing. If I could provide a high-level view, I’ve always said that markets never become less regulated; that’s just the nature of the industry. This creates a consistent tailwind for our business. While we don’t want to see our clients under constant pressure from new regulatory changes, it’s an unavoidable aspect of the industry. Regardless of the asset class or geography, the trend consistently moves towards more regulation.
Specifically, several events have driven our growth over the past year. For instance, we signed up our first South African client because the market structure there has been evolving. The exchange no longer provides surveillance to its clients in the same way it used to, prompting local clients to seek alternative solutions. We’ve seen similar activity in Brazil, where the local regulator has either stopped or is considering stopping the provision of trade surveillance services to its registrants. Consequently, these clients are looking for alternative vendors, driving our growth in these regions.
Additionally, regulatory focus on specific areas where we have historically excelled has also contributed to our growth. For example, the recent substantial fine imposed on JP Morgan for data governance issues has dominated our meetings in recent months. There’s significant concern among clients that their existing systems, whether provided by vendors or developed internally, may not have the necessary internal controls to ensure all data from their activities is captured accurately in their monitoring platforms. We’ve addressed these data integration challenges since the inception of our company. Our systems reconcile market data, trade lifecycle data (such as buys, sells, cancellations, and replacements), and reference data to ensure comprehensive coverage and identify any potential gaps. This approach, surprisingly, wasn’t always standard practice but has become crucial recently.
Moreover, changes in the fixed income market in the United States, which now require certain participants to become broker-dealers, have also generated considerable activity for us. So the continuous drumbeat of regulatory change, market structure issues, and regulatory focus on new areas – along with the continued movement to Eventus and away from inflexible legacy surveillance solution providers – have all been significant drivers of our growth.
TTI: Are there any particular areas of new functionality or enhancements that you’ve rolled out in the last year or so that have been particularly exciting for your client base?
TS: For us, there have been two significant areas of focus. Firstly, we’ve been continuously enhancing our user interface (UI) for about two years now, and we keep pushing the boundaries of what we can achieve. Part of this effort is about consistently improving the UI to enhance the workflow. The real cost of these systems isn’t just the licence fee but also the time spent on resolving alerts and conducting investigations. We spend a lot of time with our clients to understand how they interact with the system and the quality of the alerts generated. We incorporate this feedback into the user experience, constantly refining and enhancing it. This is an ongoing process for us.
Secondly, we’ve been rolling out what we call cross-product surveillance. Interestingly, while regulators often discuss cross-product surveillance, there aren’t many cases that mandate it as a requirement yet. At conferences, regulators often talk about cross-product surveillance, but practical implementation can be challenging. In many instances; regulators would need to collaborate across different asset classes, like derivatives and equities, which doesn’t always happen, or across different jurisdictions. Our clients hear about cross-product surveillance and request it, but there aren’t many specific use cases yet. However, we anticipate more cases as regulators in different parts of the world with jurisdiction across asset classes increase their focus.
Our cross-product market manipulation functionality is particularly exciting. It allows clients to compare any product in any asset class with another to detect manipulation. A good example is the Bitcoin ETFs approved in the US. With our system, you could potentially identify manipulation in the spot market versus an ETF, which operates in the equity markets. This is a prime use case demonstrating where we see demand growing.
Additionally, we’ve developed a feature called trader profiles. This helps us monitor how individual traders operate over time, including the names they trade, when they trade, and how they trade. If a trader deviates from their usual patterns, the system flags it for the client. This form of anomaly detection shows when someone is doing something different—not necessarily bad, but just different. We’re in the early stages of this, but it’s another exciting area we’re developing to assist our clients.
TTI: One of the things I’d be interested to get your insight on is the “buy to build” approach, which is something you’ve spoken about previously. Can you elaborate on this?
TS: Certainly. Alongside data governance and integrity, the “buy to build” approach is a major area of focus, particularly for tier-one clients. Instead of simply offering software as a pre-defined solution, we provide a more platform-oriented approach. This means we supply the essential data integration capabilities—covering the three main data sources—but allow clients to customise their experience based on their specific needs.
Clients can determine whether they require all the visualisations, just the workflow, or merely the procedure logic. This flexibility enables them to pick and choose the components they interact with. We’re still in the early stages, but larger institutions, which often have substantial resources, might not want our UI. Instead, they might prefer the data stream integrated into their own platform, or they might just want the feeds or results of procedures to feed into their system.
To support this, we have well-defined APIs that allow data to flow in and out of our system, enabling alerts to be sent to different systems or visualisations to be customised for specific results. While this trend is currently more prevalent among the largest institutions, we anticipate it will gradually extend to smaller entities as well.
Many of these clients have already invested significantly in their existing infrastructure and are reluctant to discard it. Instead, they prefer to fill in the gaps they perceive or leverage our expertise in specific areas. This approach is about combining the best components to deliver an optimal solution moving forward.
TTI: What do you see as the emerging trends and challenges in the trade surveillance and financial risk solutions industry?
TS: A general trend in the industry is developing a robust data platform—whether that’s a data lake or other data infrastructure—and then leveraging that platform. However, data infrastructure remains a challenge for many clients and the industry as a whole, given the need to normalise and analyse data across asset classes, communication protocols, and geographies.
“Componentisation” and the use of open APIs are trends that will continue to grow. We have always aimed to move at the speed of our customers. The more we can build into the platform to make it self-servicing and self-supporting, the better. This includes better data normalisation tools and workflow tools that clients can integrate with their existing infrastructure, whether that’s centralised infrastructure, alerting systems, workflow tools, or other investments they’ve already made. Every one of our clients has existing technology, and whether we’re replacing a legacy provider or just the trade surveillance engine, we aim to integrate smoothly with what they already have.
This trend of integration will only grow, especially as clients invest in modern tech stacks. They don’t want to discard these investments, and we certainly don’t want to force them to. We approach all our clients by working with their existing data, not forcing them to conform to a specific standard. We ask if the data answers the questions they want answered, contains all required timestamps, and is as detailed as they need. If it meets these criteria, we work with it as it is.
Data is increasingly valuable, and everyone is trying to monetise their internal data. We frequently discuss with our clients how we can work with their existing infrastructure. This trend is evident across all financial risk platforms, which are becoming more generalised analytics platforms. However, it’s crucial to remain specialised in certain areas because trade surveillance is a complex problem.
Being proficient with data is not enough; we also need to understand and adapt to new rules and regulations. Part of the value we provide is our expertise in financial risk, particularly in trade surveillance and algo monitoring. We strive to balance being both a versatile data platform and experts in financial risk. Achieving both is what makes us attractive to our clients and prospects.
TTI: Finally, Eventus was recently named the best trade surveillance solution at the TradingTech Insight USA Awards. You’ve won several similar awards in the past. What do recognitions like these mean to you and your team?
TS: We greatly appreciate these awards and the process behind them. They provide our clients with validation that they are choosing a top-notch vendor and partner. When we first started almost 10 years ago, we focused on these awards because, as a young vendor, they offered important validation for our clients. Now, with about 40 awards under our belt, they continue to affirm our expertise and capabilities.
These recognitions serve as external validation from the industry, demonstrating that we excel in what we do. They also assist our clients in building their case, whether they are replacing a legacy system or integrating a new vendor. Awards like these offer valuable supporting materials, reinforcing the decision to work with us. We sincerely appreciate the efforts behind these awards and the recognition they bring.