Symphony, a secure messaging service backed and used by 14 of the biggest banks on Wall Street, is raising up to $200 million in a new round of funding with a pre-money valuation over $1 billion, TechCrunch has learned. The funding will come from existing investors, along with a new backer, the government of Singapore via its investment arm (which includes Temasek and GIC). Symphony has plans both to expand its current business serving the finance community, and it also wants to gear up for targeting other verticals, such as healthcare.
Most recently, in March 2015, Symphony had raised $100 million at a valuation that sources at the company tell us was around $700 million. Its existing investors include Google, Lakestar, Natixis, Societe Generale, UBS, and Merus Capital, as well as a consortium of 14 of the world’s largest investment banks and money mangers, including Bank of America, BlackRock, Citibank, Deutsche Bank, Goldman Sachs, HSBC, and JP Morgan. It has raised $166 million in total.
It’s not clear whether this latest round — which could range between $125 million and $200 million, a source close to the company said — has completely closed, but it seems that it came out of inbound interest in the company rather than Symphony actively seeking the extra capital.
It’s also been in play for a while, it seems. In October, the Wall Street Journal reported that Symphony was raising up to $100 million, also naming General Atlantic and the Singapore government among potential new investors, corroborating what our source told us.
Symphony itself would not comment directly about this latest infusion (which, again, we’ve heard has come from investors approaching it):
“We are not seeking new funding,” a spokesperson said. “We are well-funded for our operations and future growth.” Separately, David Gurle, the CEO and founder of the company, confirmed via the spokesperson that were there a round being raised, it would indeed be at above a $1 billion valuation.
Symphony took off as a business in 2014, when the consortium of banks that back it acquired a messaging company called Perzo with the intention of creating what some have described as a “Bloomberg killer.” This refers to the all-in terminals that Bloomberg makes and licenses to financiers that they can use for short communications, to track stocks and watch the world of business news zip by.
The issue for banks has been that they have been dissatisfied with their existing terminal product, which was seen as expensive and bloated with more data than anyone needed or used. On top of that, many of them were turning to other services like WhatsApp to exchange messages with their contacts and clients.
Symphony was built to fill in that void with a pared-down product.
Putting messaging at the core, earlier this year it added several other key features. It now also features voice and video chat; and like Slack and others, it provides a list of other apps that users can add in to expand the service to cover what they actually need. That marketplace for now is pretty small: currently only five apps: Dow Jones, Selerity for surfacing content relevant to discussions, Chart IQ, S&P market intelligence, and Fintech Studios, another bridge to more data sources.
In addition to being extremely portable (you can use it on your phone), Symphony is cheap compared to Bloomberg terminals. The latter can cost around $25,000 per terminal annually (or lower if you are buying in bulk). Symphony’s pricing is freemium, with its paid tiers costing $15/user/month.
Last but not least, key to its product is the fact that it’s been built for people to speak to others outside their own company silos, but in a way that compliant with security and regulatory policies. “If you knew how hard it is to get banks to collaborate and work together, you would understand what a big achievement Symphony has been for that alone,” one person told me.
While large tech companies like Microsoft and Facebook duke it out against startups such as Slack to be the definitive platform for workplace communications and collaboration across a wide range of verticals, Symphony is taking a very different approach to the market by being more specific.
So far, it has been created a product aimed at one primary vertical — the finance industry. But from what I’ve been told, this is not all that Symphony would like to do longer term.
The company is looking at other industries that have equally specific needs but at the heart of any productivity solution also need efficient chat services to speak with colleagues and partners. Healthcare is one area that I’ve been told the company is looking to target next but you can see how the opportunity could apply to a number of others, from government through to education and science.
Additional reporting by Ron Miller.