Calculus Capital invests £2.5m in Essentia Analytics

Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) specialist Calculus Capital has invested £2.5m in fintech company Essentia Analytics, a leading provider of behavioural data analytics and consulting for professional investors. The investment by Calculus will be used to further develop Essentia’s services as it scales its client base of investment management institutions around the world.

The firm’s Essentia Insight service – which is used by clients including active fund managers, chief investment officers, asset allocators and wealth managers – provides a continuous data-driven feedback loop, similar to those used by athletes.

To date, Essentia has helped clients managing more than £30 billion in aggregate assets uncover an average of 94 basis points per annum of extra “behavioural alpha” through its proprietary process and technology.

The technology, which has a significant machine learning component, looks at all of an investor’s past trading decisions and rapidly identifies statistically-significant patterns of behaviour that have impacted performance in the past. Essentia then helps the investor realise that additional performance through a combination of regular face-to-face sessions with one of Essentia’s team of Insight Partners, all of whom are former portfolio managers, and automated, tailored ‘nudge’ notifications.

With offices in London and New York, Essentia was founded by CEO Clare Flynn Levy, who formerly ran pension funds for Deutsche Asset Management and founded a hedge fund business.

Flynn Levy said: “We are delighted to have Calculus on board. Their investment and expertise come at a hugely important time for us. Asset managers face increasing pressure to prove their alpha-generating skill and improve performance, which provides a significant opportunity for us to continue growing and developing our service. We are very much looking forward to working closely with Calculus to achieve our mission of helping human investors make measurably better decisions.”

Alexandra Lindsay, investment director at Calculus Capital, who has been appointed to Essentia’s Board of Directors, said: “The team at Essentia have a wealth of experience in the worlds of investment, technology and behavioural science and that knowledge is reflected in the quality of their service.

“Their combination of innovative behavioural analytics, automated ‘nudges’ and face-to-face consulting helps asset managers to make measurably better investment decisions.

“That’s an attractive proposition and we believe that Essentia is a company with very strong growth potential.”

Essentia Analytics was advised by PwC and White Horse Capital and was part of their first Series A Raise accelerator programme.