As a growing number of companies jockey for position in the online investment banking space, Tony Hill is trying to differentiate his platform, Miami, Fla.-based PE-Nexus, as a social networking service with a dealflow engine built in.
Since its launch in July 2010, the PE-Nexus service has attracted 2,100 unique members from some 1,600 companies, including investment bankers, merchant bankers, private equity groups and public and private Fortune 1000 companies, Hill said. “We’re going to increase the bandwidth of the dealflow that any banker can take on,” he said. “Bankers will be able to use this platform to catalyze more efficient auctions.”
The question is which rival is likely to gain more traction with users. PE-Nexus probably competes most directly with AxialMarket in the United States and with the more European-focused MergerID, a service of MergerMarket, a unit of Financial Times Group.
These services provide networking for investing pros and venues for publicizing deals, as an alternative to printed presentations and secure online deal rooms. But other rivals are taking different approaches. SecondMarket and SharesPost, for instance, provide platforms for trading non-public securities of one type or another. Just in October, Liquidnet Holdings Inc., an operator of a “dark pool” for the institutional trading of public securities, announced plans to provide a marketplace for shareholders of venture-backed and other non-public companies.
But such efforts are at a much earlier stage than consumer e-commerce and social networking, where a few gigantic Web sites, such as Amazon.com and Facebook, dominate the landscape. And of course, doing corporate finance deals is a much more involved undertaking than downloading an e-book or album of music.
PE-Nexus released the 2.0 version of its service in November, introducing a “private process” so that a deal manager can control the list of prospective suitors getting access to a target company. The company was launched last year by Hill and Matthew Wells, both of whom had been senior associates at Cross Keys Capital, an investment banking boutique in Miami; Kevin Doyle, a Cross Keys alumnus who was most recently an associate at Miami buyout shop
While the fledgling company expects to have its hands full as it introduces the site’s new features to users, it already has its eye on its next target, Hill said. “The big goal that’s out there, the overarching disruption factor that we’re going after over the next six to 12 months is the private business owner himself.”