Originally published in Fintech Times
Firms spanning the financial sector, including banks, broker-dealers, trading entities, and exchanges, grapple with intricate regulatory frameworks and compliance demands while striving to uphold operational transparency and integrity.
Within this challenging landscape, Austin-based Eventus provides financial risk applications to equip organisations in risk mitigation, cost reduction and regulatory adherence. The company was founded by CEO Travis Schwab, who has served in chief executive, compliance, sales and financial technology roles across the front, middle and back offices at a diverse set of organisations for more than 25 years. Before founding Eventus, he was the CEO and chief compliance officer of RGM Securities, the broker-dealer subsidiary of one of the largest proprietary trading firms in the US before its 2017 acquisition by DRW.
In this week’s In Profile, Eventus CEO Schwab discusses the company’s mission, recent achievements, journey into fintech, and the challenges and opportunities in the financial industry.
Tell us more about your company and its purpose
We at Eventus offer our clients state-of-the-art, at-scale financial risk applications like trade surveillance, market risk and algo monitoring so they can keep pace with evolving markets and regulations, mitigate risk quicker, and lower the total cost of running their surveillance program.
Our clients include banks, broker-dealers, futures commission merchants (FCMs), proprietary trading groups, exchanges, market venues, energy and commodity trading firms, and crypto platforms. The need for prudent risk management crosses asset classes, so we cover equities, options, futures, commodities, and new markets like crypto, and even products like health insurance claims and music derivatives.
We provide our clients with a reliable, flexible platform, coupled with collaborative customer support and product development, so that they can overcome their most pressing trade surveillance and regulatory challenges. Compliance teams face regulatory scrutiny, fines, and personal liability if they get it wrong. Validus, our platform, is designed by practitioners and shaped by our clients.
What are some of your recent achievements you’d like to highlight?
We recently introduced our new user interface (UI) for Validus, which provides clients a more streamlined and efficient experience, along with enhanced investigation tools, visualisations, and workflow management. This new UI, combined with our existing features like customisable automations, offers powerful capabilities.
I’m particularly proud of this rollout because it was designed by our market, regulatory, and tech experts, as well as shaped by our clients’ feedback and experiences. This was a true team effort and an example of our commitment to empowering our clients and providing them with the flexibility needed to make their trade surveillance tech work for them. So far, we’re hearing that the new UI is easy, intuitive and that it adds value to our clients’ daily use of Validus.
And we are not stopping there. Our team is now hard at work developing new architecture that will take us to our next phase of scaling capabilities. We envision being able to handle hundreds of billions of messages a day in real-time. Further, our agile process will allow us to quickly deploy new features like cross-product surveillance, artificial intelligence and the bespoke capabilities our clients continue to demand.
Lastly, we’re also proud of our global growth and continued attention on supporting our clients as they expand. We have more than 100 client companies across the finance industry now, with nearly 40% of our revenue last year coming from outside the U.S. This is a testament to our team’s dedication and deep expertise across the global trade surveillance, compliance and regulatory spectrums.
How did you get into the fintech industry?
Before Eventus, I had a variety of roles across the industry including a couple of stints as a chief compliance officer with almost three decades now of experience in the capital markets. I saw firsthand the need to overhaul legacy approaches to managing the risks that accompany trading. There just wasn’t anything on the market that was robust enough to process the frequency, volume and breadth of products we were trading. And there wasn’t anything that identified risk across various axes. So, we started Eventus.
We went live in 2015 based on the many conversations we had with early clients. They were the driving force behind our innovation then, and our clients continue to help influence our evolution today.
What’s the best thing about working in the fintech industry?
Building financial technology gives entrepreneurs and industry veterans like myself an opportunity to innovate legacy processes consistent with the needs of a highly regulated industry. For me, I identified something that wasn’t working, and assembled a team of engineers and practitioners to solve the complex challenges that accompany trade surveillance. The opportunities to innovate and improve compliance processes really are endless – from regtech to insurtech to paytech, the list goes on.
What frustrates you most about the fintech industry?
We would like to see compliance culture become a larger part of corporate culture, and not simply viewed as a checklist item or a hindrance to business growth. We see that compliance and robust finrisk management can be an enabler and a core part of a firm’s everyday workflow.
Adopting the right technology and making sure it’s implemented correctly is a key part of this. What frustrated me when I was CCO was that legacy systems and internal builds became quickly outdated. The true TCO – total cost of ownership – of those systems grew over time. Now we have more flexible alternatives that are updated regularly with industry best practices.
How have your previous roles influenced your career?
Our origin as practitioners has been a key to our success. The experience we had as compliance officers gives us first-hand experience with what our clients are facing, and we empathise with them. We have felt that pain personally.
The idea for Eventus’ Validus product came out of necessity. I was looking at a new clearing firm for our proprietary trading business 10 years ago, and no bulge bracket was willing to clear us without going through their execution layer, citing too much ‘risk’. I was also looking for a way to audit the various risk tools we were using internally. As mentioned, there wasn’t anything on the market at that time that could handle the frequency, volume and broad scope of products we were trading that also examined the various risks that accompany any company supporting or trading itself. We started Eventus to create that capability.
Our experience on both sides of the client/provider divide has shown us that enterprise financial risk management, especially trade surveillance software, must be adaptable and allow compliance teams to have significant input in how their technology works. Our business is heavily informed by our experiences and our many conversations with clients.
What’s the best mistake you’ve ever made?
Half jokingly, the best mistake I made was launching a startup. Looking back, I was established in my career, had a range of options, and I knew that starting a company is never the easy path. But our team had great confidence in our vision and knew this was something that our industry needed.
Starting Eventus, while risky like any startup is, was also a continuation of the work we were doing in our previous roles. Others may have seen it as a ‘mistake” or a career ‘risk’, but I’m happy we pushed ahead.
What has the future got in store for your company?
We see increasing demand and growing partnerships in the Asia-Pacific region, as well as Europe, the Middle East and Africa across a diverse range of firms. We continue to add clients across all regions and focus on our core areas of strength. We’re expecting this momentum to only grow as issues of compliance across asset classes and regions become more acute. Markets never get less regulated, so there is always a tailwind for our business.
We are also focused on expanding the work with existing clients, providing them options for more dedicated services and personalised development, and helping them scale their compliance program to match their business plans.
As mentioned above, we also have more exciting technology advancements in the pipeline. Our platform is already proven across complex trading environments, but data challenges across the industry are accelerating. Our engineering team is working on a new technical architecture that will enable faster scalability with our clients and allow improved features like cross-product surveillance and expanded use of artificial intelligence.
What are the next key talking points or challenges for your industry as a whole?
The financial industry is facing a more stringent regulatory environment today. This is something we take seriously because the stakes are too high to get compliance wrong. Companies, their CCOs and employees are subject to personal liability, even criminal penalties, for compliance shortfalls. At the same time, these teams are trying to monitor high volumes of data across multiple geographies and regulatory regimes. They are under enormous pressure to execute a compliance program with limited resources. That’s something our industry will deal with for the foreseeable future.
The good news is that compliance teams now have more options than they did only a short time ago. The technology has advanced. For example, we have leveraged machine learning with explainability for years but the explosion of generative AI and new LLMs introduce more ways to help clients better manage risk. The future-state of surveillance will have to combine engineering innovation and compliance expertise to each clients’ unique needs.