youDevise, of London, has agreed to buy Boston-based First Coverage. Financial terms were not announced. The companies provide online services that allow institutional investors to receive short- and long-term trade ideas from their brokerage firms. Commonwealth Capital Ventures of Boston, GrandBanks Capital of Boston, and JLA Ventures of Toronto were original investors of First Coverage.
The leading providers of alpha capture networks for financial markets – youDevise Ltd. of London and First Coverage of Boston – today announced they have merged into a single entity, forming the first comprehensive global network for institutional investors and brokerages.
youDevise and First Coverage market online services that enable institutional investors to receive short- and long-term trade ideas from their brokerage firms, making it easier for money managers to identify ideas with real value. Trade ideas are time sensitive, client specific long/short recommendations, based on all information likely to affect a stock’s price near term.
The combined company, which will operate under the youDevise name, serves more than 150 institutional investors, including major hedge funds, traditional money managers, and specialist alpha capture funds, and more than 560 sell side firms, from the largest bulge brackets to smaller boutiques. Together, the two platforms transmit more than 2,000 ideas a day, up 60% from a year ago, on stocks primarily traded on markets in the US, UK, Europe and Asia.
youDevise launched its Trade Idea Monitor (the TIM) in 2005 and First Coverage debuted its eponymous service in 2006. Integration of the platforms is expected to be completed in 2011, with the best features of First Coverage becoming part of the TIM. Until then, users will have continuous access to their service of choice and will be updated when new enhancements are released.
Investors in the merger include a syndicate of venture capital firms comprised of Commonwealth Capital Ventures of Boston, GrandBanks Capital of Boston, and JLA Ventures of Toronto. All three were original investors in First Coverage.
The merger will give money mangers access to brokers with specialties in all developed and emerging markets. The merger will eliminate the need for brokers to use multiple systems and help reach a greater number of clients. For both, the merger will increase 24/7 sales and support through youDevise offices in London, New York, Boston, Toronto, and Hong Kong.
“youDevise is pleased to join forces with the First Coverage team because we are both passionate about the future of trade ideas,” said Colin Berthoud, Founding Partner of youDevise. “The merger makes tremendous sense for our clients who can use the combined network to access knowledgeable counterparts on any scale of stock, in any sector, anywhere in the world, while providing brokers with new ways to monetize their intellectual property.”
“Our shared ‘customer first’ commitment, to help the buy and sell side create value from trade ideas, will be significantly enhanced,” said Roland Beaulieu, CEO of First Coverage. “Given the alignment of our visions, technologies and strategies, the combination of youDevise and First Coverage creates the premier alpha capture platform in the world.”
“The continued financial support from institutional investors underscores their confidence in the rapidly growing alpha capture market,” said Jeff Hurst, a General Partner and Co-founder of Commonwealth Capital Ventures. “Its strengthened position enhances youDevise’s ability to meet the increasing global market demand for what has become a highly dynamic new front in institutional investing.”
The combined company is headed by Rich Koppel and Colin Berthoud, founding partners of youDevise. First Coverage’s Roland Beaulieu and Commonwealth Capital Ventures’ Jeff Hurst have joined the youDevise Board of Directors.
In addition to the TIM, youDevise markets the Hedge Fund Information Provider (HIP), the leading online platform used by Funds of Hedge Funds directly or through large administrators, such as Northern Trust (NASDAQ: NTRS), for front, middle and back office management information and decision making.
More information can be found at www.youDevise.com and www.firstcoverage.com.