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iCapital Network builds out alternative investments with Axio acquisition

Wednesday, September 22, 2021
Opalesque Industry Update - iCapital Network, the global financial technology platform driving access and efficiency in alternative investing for the asset and wealth management industries, and Axio Financial LLC (Axio), an end-to-end service provider to the U.S. structured notes market, announced they have entered into a definitive agreement under which iCapital will acquire Axio.

The acquisition will expand iCapital's menu of alternative investment strategies, technology stack, educational offerings, and support services for financial advisors. It will also enhance iCapital's distribution capabilities to support fund managers. Today, iCapital services more than $86 billion in global client assets across more than 790 funds.

Founded in 2010, Axio provides financial advisors with support in the evaluation, selection, and purchase of structured notes to complement the investment portfolios of their clients. Axio's full-service solution is integrated with the industry's leading domestic and international bank issuers of structured notes and various ecosystem providers. Axio leverages real-time data, analytics, and reporting interfaces to meet the diverse requirements related to the full structured note lifecycle. In addition, Axio serves both issuers and financial advisors with customized and knowledgeable distribution support fueled by state-of-the-art CRM technology.

In the US, more than $72 billion in structured notes were issued in 2020, an increase of 36% as compared to the prior year, with 2021 issuances expected to reach $86 billion. Axio is expected to exceed $9 billion in issuances in 2021.

"iCapital is committed to being the single, comprehensive source for financial advisors seeking alternative investment opportunities to optimize portfolio performance. Advisors considering structured notes for their high-net-worth clients need best-in-class access, education, consultative support and enabling technology such as iCapital provides for other alternative offerings. Axio's position as a leader in this market makes them an ideal enhancement to our already robust platform and product offerings," said Lawrence Calcano, Chairman and Chief Executive Officer of iCapital Network. "We are thrilled to welcome the talented Axio team to iCapital."

Under the agreement, Marc Paley, CEO, and the entire Axio team will join iCapital. As Managing Director, Head of Distribution, Marc will report to Mr. Calcano, and maintain his responsibilities as leader of the Axio team, providing advisors with comprehensive support in their consideration of structured notes as well as iCapital's full menu of alternative investments.

Similar to other alternative investments, structured notes require thorough advisor education and support alongside technology that eases access, which iCapital will continue to provide and enhance within the framework of its end-to-end alternatives platform.

"The Axio team is excited about the intuitive synergies and the common purpose driving both Axio and iCapital, and we're thrilled to combine our efforts to serve financial advisors and their clients," said Marc Paley, CEO of Axio. "I look forward to working together to integrate and continue to achieve our objectives."

iCapital's purchase of Axio is the most recent step in the firm's commitment to expand the scope of strategies and product types available on its alternative investment platform and enhance platform technology to serve wealth advisors and their clients. This month, iCapital announced that financial advisors would have access to digital currencies on the iCapital platform through a partnership with Grayscale Investments. Earlier this year, iCapital completed its acquisition of AI Insight to bolster its Alternative Investments education and compliance offerings for financial advisors.

In February, it also announced a partnership with the Chartered Alternative Investment Analyst (CAIA) Association, to launch AltsEdge, a comprehensive education initiative designed to help advisors better understand alternative investments and how they can leverage these products via a series of guided modules. iCapital continues to look for opportunities and resources to help advisors expand their mastery of complex products and offer tools to help integrate them into client portfolios.

The transaction is expected to close in Q4 2021 after receipt of necessary regulatory approvals. Terms of the agreement were not disclosed.

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