By Marc Andrusko, Partner, Oak HC/FT
I grew up professionally on the Goldman Sachs trading floor.
I joined in 2013, fresh enough to believe that the systems powering the world’s most important financial markets were, by definition, world-class. They weren’t. The reality was a patchwork of legacy tools, internal builds, brittle workflows, and an institutional bias toward “we’ll just build it ourselves.”
During my time there, Goldman somewhat infamously built its own CRM for the Securities Division and its own email client. Both were massive, expensive undertakings. Both were defended as strategic necessities. And both are decisions that would almost certainly never get approved today, when you can buy something like Salesforce Financial Services Cloud and a best-in-class email client off the shelf.
Fast forward a little more than a decade, and something fundamental has changed. Capital markets – long considered hostile terrain for startups – are suddenly flashing the Bat Signal. The talent is there, the buyers are primed, and the workflows and data sets are quite insulated from the very formidable AI labs.
This is an optimal moment to build capital markets technology companies.
What Changed
1. The Talent Pool Looks Different Now
Historically, founders building for capital markets tended to look a certain way: already-wealthy former traders or bankers, semi-retired, scratching an “act two” itch after a lucrative act one.
They brought deep domain expertise and existing networks. What they often lacked was a Silicon Valley-caliber technologist to complement them, and, perhaps more importantly, the sense of urgency and do-or-die mentality typical of young founders for whom the stakes couldn’t be higher. The downside mattered less. The upside, while intellectually satisfying, wasn’t existential.
Today’s founders in this arena look very different. Increasingly, they’re younger, technical, and ambitious operators who choose capital markets not as a convenience, but as the hardest (and potentially most valuable) problem set available. These teams are ambitious, well-balanced and high velocity. For every Wall Street quant they bring onboard, they also add a Ramp engineer, a former McKinsey consultant, or a designer from big tech. They are neither myopically New York finance nor Silicon Valley startup, but rather a magical blend that captures the most compelling elements of both.
2. Financial Institutions Have an Existential Imperative to Buy
The cultural shift inside financial institutions has been profound.
For decades, elite banks had a strong on-prem, build-it-yourself bias. Third-party software was tolerated at the margins, not embraced at the core. Security, control, and pride all reinforced the same conclusion: external vendors were risky, and internal builds were “safer.”
That mindset has cracked.
Cloud adoption is no longer controversial. Best-in-class vendors are not just acceptable—they’re often preferred. The opportunity cost of internal builds is now well understood. Time-to-market matters. Maintenance burden matters. Talent allocation matters.
Bank CIOs are getting bombarded on this topic from all angles. McKinsey’s 2025 Global Banking Annual Review suggests that AI is expected to drive up to 20% in net cost reductions for banks as the technology is implemented across the industry. The same report contemplates an opportunity for “AI pioneers” to increase their return on tangible equity–a key financial metric in any bank earnings report–by up to four percentage points. Simultaneously, Forrester forecasts that the financial services sector will spend $495B on technology in 2026, with 40% of that going to software. That proportion is higher than the US average across industries.
The net effect is simple: it is meaningfully easier to sell into these institutions than it was a decade ago. What once felt like pushing water uphill now feels like an open door. AI has only fueled this fire further; financial institution management teams are taking very sharp pencils to their middle- and back-office budgets to ensure they are being as efficient as possible on matters of OpEx. Perhaps even more importantly, they are eager to apply this technology to realize maximum efficiency on their balance sheet – the ultimate scorecard where capital markets decisions show up.
Why Capital Markets Are So Compelling
Even without these changes, capital markets have always had structural characteristics that investors should love.
Enormous TAMs
The numbers are almost absurd. Roughly $150T in fixed income outstanding globally. ~$125T in equities market capitalization. Trillions of dollars moving from point A to point B every single day.
If you can capture even fractions of basis points on that movement – through software, data, workflow, or venue – you can build a massive business. Few sectors offer that kind of scale without requiring consumer adoption or brand magic.
Defensibility from the Labs
If you’re like me, you’ve spent a lot of time with AI apps founders whose businesses rest upon integrations with common systems of record – CRMs, document repositories, communication hubs, and the like. In an era in which every investor is wondering “well can’t the model companies just do this themselves?”, no one expects the forward deployed teams of OpenAI or Anthropic to go hook into homegrown Order Management Systems (OMS), risk monitoring tools or trade blotters.
Consider a single bond trade. From order origination to settlement, it may pass through an OMS, a risk engine, a compliance pre-trade check, a venue router, a post-trade affirmation system, a custodian interface, and a regulatory reporting layer – each often from a different vendor, a different data schema, and in some cases a different decade. The idea that a general-purpose AI company would elect to integrate across that entire stack to serve a single vertical while there is much lower hanging fruit prevalent throughout almost every enterprise (legal, coding, customer support, enterprise search, etc.) is highly unlikely. Workflows in this ecosystem stitch together dozens of systems that are decades old and highly bespoke, requiring true dedication to financial services at the expense of serving others.
Winner-Take-Most Dynamics
Capital markets reward concentration.
Liquidity begets liquidity. Venues develop network effects. Data platforms entrench. Switching costs rise quietly, then suddenly.
You can see this clearly in public market comps. Exchanges, trading platforms, and market infrastructure companies consistently command some of the most attractive multiples in fintech. The market understands what founders sometimes forget: once you win in capital markets, you tend to really win.
The historical record bears this out. Over the past decade, CME Group has materially outperformed the S&P 500, delivering strong total returns while consistently sustaining premium EV/EBITDA multiples, generally in the high-teens to low-20s, across multiple market cycles – including rate shocks, a global pandemic, and the unwind of crypto excess. Intercontinental Exchange shows a similar pattern, with valuation multiples typically anchored in the mid-to-high teens and demonstrating relative resilience through periods of volatility. This consistency isn’t driven by narrative alone: exchange-like businesses benefit from deep liquidity moats, embedded network effects, and recurring revenue streams that support durable premium valuations. Tradeweb and MarketAxess exhibit many of the same characteristics in electronic fixed income, though with somewhat more sensitivity to market conditions. The result is a sector where valuation premiums have proven persistent, reflecting the structural strength of the underlying business models rather than temporary market enthusiasm.
What We’re Seeing on the Ground
I’ve been fortunate to work closely with several companies that sit squarely at the frontier of this shift. In almost all cases, the founders of these businesses are finding ways to sell sticky, recurring, high margin software contracts and earn the right to monetize GMV down the road. Every fintech investors’ favorite combo – the Toast or Shopify playbook – is coming to fruition in this market. Except rather than taking some percentage of interchange on a takeout order, it’s basis points on extremely large capital flows (often in the tens of millions).
The Signal
For a long time, capital markets felt like a graveyard for venture-scale outcomes: too slow, too regulated, too insular.
That narrative is outdated.
The buyers are ready. The talent is mobilizing. The economics have always been there. And the public markets are telling you – quite clearly – what they value.
If you’re a founder looking for a hard problem with real stakes, this is your bat signal.
We’re actively looking to partner with more people building in capital markets. If that’s you, we’d love to talk.
