YCharts Nabs Another $6 Million
Featured on Crain’s Chicago Business
Chicago-based YCharts, a financial data startup, raised another round of venture capital this month, attracting $6 million from a group led by its larger peer in the industry, Morningstar.
Chicago-based Morningstar, which built its financial information company around mutual fund research, invested previously in YCharts and is its biggest outside backer with a 20 percent stake. In conjunction with this fourth round of financing, YCharts also said in a statement that Morningstar’s representative on its board, Jeremy Diamond, became the startup’s chief revenue officer this month.
The latest infusion of capital brings the outside investment to $14.5 million in commitments and coincides with an acceleration of the company’s growth plan,said CEO Shawn Carpenter. The company has increasingly targeted registered investment advisers and other professional financial advisers as it has expanded the information and tools available on its site, focusing less on the retail investors, and mass emails to them, that were a big part of its initial rollout.
“YCharts has ambitious plans,” Morningstar CEO Joe Mansueto said in a statement. “We’re pleased to make an additional investment in the business and think Jeremy will add tremendous value to the firm.”
The company targets its stock, mutual fund and economic data product at registered investment advisers and other professional money managers. Carpenter estimates that annual revenue will triple this year over last year, but he declined to provide the figures. YCharts recently expanded its Chicago office and has 41 employees across the company, including in its New York office, he said. The company was co-founded in 2010 by Carpenter and Ara Anjargolian, who is chief technology officer.
EMAIL ELIMINATED
Registered YCharts users who had signed up for daily YCharts emails may have noticed they stopped arriving last November. Carpenter said YCharts eliminated the email, and the costs to produce it, because the company was able to partner with websites such as Motley Fool, the Street.com and Time that offer similar content that showcase YChart charts and information. That saved YCharts tens of thousands of dollars a month it was spending to have freelancers produce the content, he said.
The company’s pricing structure also has changed. Its least-expensive package today costs $480 annually, with a mid-tier price-point of $1,200 and the most expensive product at $3,600. That’s a lot lower than the approximately $24,000 per year that rival Bloomberg charges, but still pricier at the top end than the previous $199 per month option that amounted to just under $2,400 per year. Users now have only an annual contract option, not a monthly one.
“We knew that the product would take time to be built out for the professional,” Carpenter said. The approach now is different than when the company got started, but was always in the plan, Carpenter said. YCharts started with information on U.S. equities and expanded to Canadian stocks, exchanged-traded funds, economic indicators and international company stocks.
INVESTORS IN ROUND
Information provider Reed Elsevier, which also invested previously in YCharts, joined in the latest round, as did Amicus Capital Partners, Hyde Park Angels and a number of other local angel investors including Brian Hand, Wrapports Chairman Michael Ferro, Fieldglass CEO Jai Shekhawat and Orbitz CEO Barney Harford.
Hand said YCharts provides a big-data solution for managers sifting through reams of financial data. “YCharts has built a platform that provides an unparalleled way to go through that information,” he said.