Symphony sets profit goal as it pushes its communication tool as alternative to Bloomberg
Symphony Communications Services, a provider of secure communication technology seeking to break the dominance of Bloomberg’s communication platform used by investment executives, has set a goal to turn a profit within 18 months.
The Silicon Valley, California-based company has also set a target to more than double its user base to 500,000 by the end of next year and redouble it to one million a year after that, according to its founder and chief executive David Gurle.
“What the market wants is a utility to which they can transform the way they can conduct their business,” he said on the sidelines of the Forbes Global CEO conference on Wednesday.
Symphony has 230,000 users and 200 corporate clients, up from 220,000 users and 190 firms last month.
Unlike Bloomberg, which sells financial market data, news and a communications tool to financial sector executives as a bundled offer through its terminals, Symphony focuses on providing a platform for them to communicate and share content.
To better compete with Bloomberg, Gurle said Symphony has joined with its rival Thomson Reuters which provides news and data, as well as data and analytics provider FactSet, to combine their offerings at a lower price than Bloomberg to meet the same customer needs.
A Bloomberg spokeswoman in Singapore declined to comment on its sales and pricing strategy.
Information sharing is important to financial asset traders and fund managers allocating clients’ funds, since the speed at which they make trading decisions in reaction to market information has huge implications for profits and losses.
Gurle said his vision is to “transform” the way people work to make them more efficient through greater collaboration – and sharing information in a secured manner is the key.
“Work is becoming more social, electronic, automated and distributed,” he said. “You need stronger collaboration with your colleagues whether inside or outside the organisation.”
He noted that Bloomberg’s around 320,000 users represent only 16 per cent of the estimated 2 million workers in the global capital markets, with the remaining majority primarily using emails to conduct work related communication.
“So for us, being compared to Bloomberg is really as if our ambition is so small,” he said, adding that Symphony’s business which he set up five years ago and sold to Goldman Sachs and other financial institutions three years ago, will expand to non financial sectors early next year.
The main industries it will target include accounting, insurance, legal, government and health care.
Asked how Symphony is different from other sharing platforms such as Global Relay and ICE Chat for businesses, and WhatsApp and WeChat for individuals, Gurle said it lies in its “end to end encryption” of content where each customer has control over a unique “key” to decode it.
“It is like the key to your house. [The difference is whether] the building [managers] own the key or you own the key,” he said. “[In the former case], it is as if your house is secured by them and not by you.”
Gurle said Symphony expects to sign up another Asia based client – the Hong Kong operation of a major Chinese investment bank – before year end, after it clinched a deal last month to deploy its platform at CLSA which has 1,900 employees in the region.
Symphony plans to enter the mainland China market when its platform is approved by regulators, adding that if the Chinese government wants access to certain data for regulatory reasons, it would be the responsibility of its potential clients to meet the request.
Gurle rejected concerns the company may have to offer its platform at a low price to compete with Bloomberg, adding that it expects to be profitable by the fourth quarter of next year or the first quarter of 2019.
Asked if it plans to go public, he said Symphony will “prepare for” a potential initial public offering, but has no concrete plan for one.
The company has raised three rounds of funding totalling US$229 million from 21 shareholders, the latest of which was completed in May this year.