Direct Institution Trading Platform

Ken describes creating an electronic marketplace for corporate bond trading that enables large institutions to trade directly with each other, bypassing traditional investment bank intermediaries.

Key Points:

• Core Innovation:

  • Built electronic platform for direct institution-to-institution corporate bond trading
  • Allowed major players like Fidelity and Pimco to trade directly
  • Eliminated need for traditional investment bank middlemen

• Traditional Model Being Disrupted:

  • Required calling Goldman/Morgan Stanley to broker trades
  • Banks would either:
    • Find matching buyers/sellers
    • Buy bonds themselves and resell at markup

• Business Context:

  • Launched as fintech startup called Electronify in 2015
  • Focused on corporate bond market
  • Eventually sold to competitor

• Market Positioning:

  • Targeted major institutional investors
  • Covered West Coast market from LA base
  • Aimed to increase trading efficiency and reduce costs

The platform represented a shift from relationship-based phone trading to direct electronic matching between large institutions, though ultimately the startup was acquired rather than succeeding independently.