As new European regulations disrupt the corporate access landscape, two former Credit Suisse corporate access professionals launched an independent corporate access vendor offering banks an outsourced solution to an increasing unprofitable business.
London-based InterAxS Global’s initial focus is on generating events around pending IPOs, an under-served area by banks. The firm is hosting a webinar on Slack this week and one on WeWork next month. “The bank-associated corporate access model limited the scope of what we could cover,” co-founder Lucy Richardson said in an interview. “As an independent we can delve into innovative areas where investors have a real need for insight.”
At same time InterAxS Global is offering banks outsourced corporate access as post-MiFID II fees for corporate access have withered. “We give banks the opportunity to remove fixed costs while keeping client service levels intact,” said co-founder Cathy Norbury. The firm says it has already received commitments from at least two investment banks.
The new venture was formed in February 2019 after the pair, who led Credit Suisse’s European corporate access efforts, left the bank to go independent. The initial priority has been introducing the InterAxS IPO Series, which sources experts associated with pending IPOs. For example, the Slack webinar this week will feature Slack’s former advisory CMO and former Microsoft executives who managed products competing with Slack.
The firm is also organizing a London seminar with executives from sports tech and eSports companies, with panels moderated by London merchant bank UFP Aquilor Capital which funds and advises sports and entertainment companies. Other pending events, located in both New York and London, focus on 5G, FinTech and AI in the Retail Sector.
The business model for the new venture will rely on attendance fees for events and payments from banks for organizing events on their behalf. In addition to the two principals, the firm has brought on former MergerMarket editor Reuben Miller to help launch its website and moderate the first few panels.
The European corporate access market has been thrown into disarray, first by UK regulators banning the use of client commissions to pay for vanilla corporate access and then by MiFID II’s requirements to pay cash for research. European payments for bank-facilitated one-on-one corporate access are often in the $100-$200 range, amounts which might barely cover the costs of organizing events. In contrast, our latest research pricing survey indicates that median fees for events outside Europe range between $2,500 and $5,000.
InterAxS Global is betting that in the current European environment it can offer more cost-effective and nimble corporate access services as an outsourced service rather than as an in-house capability. As an independent, it may have latitude to charge more normal market rates for events, while at the same time receiving payments from banks seeking to outsource an increasingly unprofitable business line. The turmoil surrounding MiFID II creates risks for the new venture but also, as the co-founders have recognized, significant opportunities as pressures on banks accelerate.