Listen to the Article: Invast Is Now 26 Degrees, and This Is Why They Renamed Themselves

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As we reported last week here at Fazzaco, Invast Global, a leading multi-asset broker based in Sydney, has rebranded its prime brokerage business as 26 Degrees Global Markets​ (or 26 Degrees), aiming to significantly increase its market share in the $20 billion prime brokerage services industry over the next five years. Today, we will explore the story behind Invast Global's rebranding to 26 Degrees.

They Are Entering the Prime Brokerage to Fill up A Gap After Large Banks' Exodus

When you visit Invast Global's website and click on Institutional Clients, you will be redirected to the brand new 26 Degrees page. The company introduces itself as follows: "On its ten-year anniversary in June 2023, prime broker Invast Global rebranded to 26 Degrees Global Markets…26 Degrees is exclusively focused on servicing broker dealers, emerging hedge funds and family offices affected by the continued tightening of access to Tier 1 Prime services and support." 

There is a key point here, which is also the reason why Invast Global chose to enter the prime brokerage market as a challenger service provider: the "tightening of access to Tier 1 Prime services". To put it more clearly, it was the aftermath of the global banking crisis in 2023 that created a gap in this market.

As Fazzaco previously reported, a wave of bank failures occurred in the global banking industry starting from March 2023. First, in March, US banks Silvergate Bank, Silicon Valley Bank and Signature Bank collapsed one after another​, triggering a sharp drop in stock prices; then, Credit Suisse, which was mired in crisis, was acquired by its rival UBS​ under the mediation of the Swiss government. Then in May, First Republic Bank failed and was subsequently acquired by JPMorgan Chase​.

Precise Target Positioning - They Are Serving Institutional Clients Who Lost Tier 1 Access

As they state on their website, 26 Degrees entered the prime brokerage market with the purpose of providing services specifically for those institutional clients who were affected by the banking crisis. Specifically, these include hedge funds with assets under management below $150 million, family offices and so on. These institutions were the ones most affected by the exit of Tier 1 investment banks. And the remaining banks chose to avoid providing services for hedge funds and other clients with assets under management below $2 million. This is exactly what 26 Degrees saw as an opportunity.

Currently, more than 90% of 26 Degrees' revenue comes from overseas, mainly from long/short funds in Europe and Asia. According to the financial report submitted by 26 Degrees before its rebranding as Invast Global to regulators, the company's revenue in fiscal year 2022 was $35 million. At the same time, 26 Degrees also faces competition from companies such as Saxo Bank, TD Cowen and StoneX.

The Development and Future of Invast and 26 Degrees

Although 26 Degrees is a new face in the industry, its predecessor Invast Global was founded in 2013 by Gavin White from former Citigroup Investment Bank and James Alexander from MF Global. Invast has been focusing on orderly business growth and building internal infrastructure for the past ten years. Fazzaco has reported several times on Invast's senior personnel changes, as well as its partnership with oneZero​ and its acquisition of GMO-Z.com Trade UK​ to expand its global business scale in 2022.

After rebranding its prime brokerage business to 26 Degrees, the Invast team plans to take over customers who were abandoned by Tier 1 investment banks such as Morgan Stanley and NatWest. They said that this niche market accounts for 15.8% of the entire prime brokerage market, about $3.2 billion. Therefore, it is expected that 26 Degrees will start fundraising soon to gradually carry out capital-intensive prime brokerage business. We will also bring you the latest funding news of 26 Degrees as soon as possible.