Exclusive: LeapXpert mints $180M round, adds sports compliance customers

Exclusive: LeapXpert mints $180M round, adds sports compliance customers

LeapXpert, a startup for companies to monitor external messaging apps, raised $180 million led by Riverwood Capital, it tells Axios exclusively.

Why it matters: The startup, which originally provided tools for compliance to financial companies, has since added sports franchises as customers amid worries of insider trading on prediction markets.

Context: Driven by client preference, bankers and wealth managers increasingly communicated via WhatsApp, WeChat, and text message rather than email.

  • But that runs afoul of SEC and CFTC rules, which require that brokerages monitor employee communications for violations of investor protections.
  • LeapXpert sits among the companies closing that gap, allowing companies to monitor these channels.

    • Zoom in: Somewhat similarly, prediction markets have created a "crisis" of integrity in sports, as several professional players have been accused of disclosing information or rigging pitches to sway bets.

  • Collusions to sway prediction market results "happens on all different communication channels," says CEO Dima Gutzeit. "We see that different teams and sports industry bodies are starting to think about governance."
  • Gutzeit would not disclose how much of the funding was secondary.

    • State of play: Responding to the rising regulatiory scrutiny in the area, some sports franchises have proactively begun sharing data with regulators.

  • In March, the MLB and CFTC agreed to "share information with each regarding the integrity of professional baseball" in a announcement with Polymarket.
  • The NHL has signed a similar agreement.
  • Gutzeit declined to say which sports organizations were now customers, noting that financial services and government remain its largest customers.

    • Between the lines: LeapXpert can't follow a bad actor onto their own personal apps — but it does ensure that a company covers its legal bases.

    The big picture: LeapXpert plans to use the new capital and expand into more industries, including life sciences and manufacturing. Gutzeit say its sports customer base was a happy accident.

  • Its bigger pitch, beyond compliance, is around unifying data, and making it actionable.
  • If LeapXpert can combine data from these siloed sources, customers could use the data to automatically update their customer's profiles, track a deal across channels, and maintain up-to-date information if an employee were to leave.
  • Agents could also be used on top of that previously unaccessed data.
  • "They are in a pole position to take all that data, mine it, and deliver it to the customers," says Riverwood managing partner Jeff Parks.