Author: Clausematch– clausematch.com
Corlytics has signed an investment from specialist growth investor Verdane for a majority equity stake in the company. This partnership will enable the company to cement global category leadership, accelerating organic growth and M&A, building on the strong client base which includes 40% of the top 30 Systemically Important Financial Institutions (SIFI).
Corlytics and Verdane have partnered to support the RegTech company’s continued growth. Verdane will leverage more than 20 years of experience partnering with European software businesses and extensive expertise in RegTech to support Corlytics. The transaction was managed by investment bank Baird in a competitive process that saw significant market interest.
The deal is a cornerstone investment from Verdane’s newly raised €1.1 billion Edda III Fund, which recognises Corlytics as a category leader and RegTech industry consolidator.
Driven by increasingly demanding regulatory requirements, financial services firms spent ~€163 billion on their risk and compliance functions in 2023 across GRC, financial risk and capital management, cyber and IT security and financial crime.
Corlytics enables customers to stay ahead of regulatory demands and is the only solution with a fully integrated end-to-end offering, from regulatory horizon scanning to policy management and through to attestation. As well leveraging generative AI throughout workflows, Corlytics is plugged directly into international regulators, delivering an industry-leading end-to-end compliance platform. Corlytics’s precision FIUI regulatory technology, is building intelligence into the regulatory content itself.
Leading GRC and RegTech analyst and commentator Michael Rasmussen said: “I’ve observed firsthand the myriad challenges organizations face in managing regulatory change and keeping their policies and controls current. With regulatory landscapes evolving unprecedentedly, traditional methods are increasingly inadequate. This is where the transformative power of AI and RegTech becomes evident in GRC. Corlytics, with this investment, is positioned to continue its leadership in this revolution. By leveraging AI, they’re not just streamlining compliance processes but reinventing them, delivering unparalleled value in efficiency, effectiveness, resilience, and agility. Verdane’s investment in nurturing tech-enabled growth is a testament to Corlytics’ potential to redefine regulatory compliance processes. It propels Corlytics to be a partner of choice for organizations grappling with the complexities of modern regulatory demands. This partnership marks a significant milestone in the journey towards a more resilient and agile regulatory compliance landscape.”
Since 2020, Corlytics has grown 60% per annum, predominantly driven by its core regulatory compliance products. The number of Corlytics customers has roughly doubled during this period. 2023 also saw Corlytics make two significant acquisitions – ING SparQ in January and Clausematch in June – creating an unparalleled platform that manages the entire regulatory risk value chain on a global scale, elevating Corlytics’ extensive offer for Tier 1 organisations including ING, BNY Mellon, ScotiaBank and SwissRe.
The company continues to be an industry pacesetter, from its work developing intelligent regulations and taxonomies with regulators such as the FCA, to its acquisitions of key policy management technologies of ING’s SPARQ and Clausematch last year. The company is the regulatory technology partner of choice for the world’s largest financial services firms enabling them to simply comply and implement ever changing regulations.
(from left) Sebastian Wintgens, Principal Verdane, John Byrne, CEO Corlytics Ltd and Simon Russell, Chair Corlytics Ltd
John Byrne, Corlytics’ founder and CEO, commented, “Corlytics has successfully progressed in developing new products to further improve our value proposition to Tier 1 clients globally. This investment from Verdane ensures the continued growing market leadership for Corlytics. We look forward to partnering with the Verdane team and with their experience and expertise, we expect to accelerate organic growth and augment that with M&A activity. As well as investing significantly in our ‘intelligent content’ offering, combining data, software and AI, we will continue to lead the RegTech sector consolidation with more complementary acquisitions, following our recent transactions with Clausematch and ING SparQ.”
Nils Vold, Partner at Verdane, commented, “Verdane is delighted to back John and his impressive team at Corlytics. This is a centrepiece majority investment from our newly raised €1.1 billion Edda III Fund and we are thrilled that John and Corlytics chose to partner with Verdane against very strong market interest in the business. We are an active and experienced investor in the RegTech sector and we identified Corlytics as the global category leader in its field, helping banks and financial services companies manage their compliance obligations in a complex and fast-changing environment.”
Sebastian Wintgens, Principal at Verdane, added, “We are excited to partner with Corlytics and look forward to leveraging our expertise in helping European software leaders to grow, both organically and through strategic acquisitions, as well as bringing our international industry networks to help Corlytics continue to thrive and succeed as it expands globally.”
As part of the Verdane investment and partnership, Corlytics is pleased to announce an expansion of its board of directors, adding further expertise to support the company’s growth plans.
As a result of the deal, Simon Russell joins Corlytics as Chair. He has almost 30 years of software advisory expertise. Over the last 15 years, Simon led technology investment banking at firms including Nomura and Dresdner Kleinwort and he served on banking management committees. He now works as a Chair and Non-Executive Director at various international software companies.
Simon Russell, new Chair at Corlytics, said, “I have long admired Corlytics as a real RegTech industry leader. I am delighted to be partnering with John and Verdane to create value through an active acquisition agenda, plus providing Corlytics with wider support on delivering its ambitious growth plans.”
Trintech founder Cyril McGuire will continue to serve on the Corlytics board as a Non-Executive Director and his Infinity Capital Fund has also invested for a minority equity stake in the company.
The terms of the transaction have not been disclosed.
ADVISORS
For Corlytics: Baird (financial advisor), Dentons (legal counsel), Liberty (management advice), BDO (financial and tax DD)
For Verdane: Trinity Square (strategic advisor), Burness Paull (legal counsel), McKinsey (commercial due diligence), Deloitte (financial and tax due diligence), PwC (structuring)
