Octaura is an electronic trading solution created by the industry for the industry. And Octaura has reimagined the way the syndicated loan and the CLO markets trade. Pulse 2.0 interviewed Octaura co-founder and CEO Brian Bejile to learn more about the company.
Brian Bejile’s Background
What is Brian Bejile’s background? Bejile said:
“I was born in Zimbabwe and grew up there. When I was 20, I came to the US to attend Haverford College. I didn’t study finance in school, but instead focused on Computer Science and Economics. Prior to founding Octaura, I was at Citi as Managing Director and Global Head of Collateralized Loan Obligation (CLO) Issuer Management, serving CLO clients across the entire CLO lifecycle. Before that, I ran the Loan Portfolio Trading and Global CLO trading desks, where I was recognized for having the number one CLO trading desk by volume for multiple years in a row.”
“I kind of landed in the world of CLO trading by accident – on the first day of my CLO structuring job, my then manager said, ‘You’re going to be trading instead.’ My background allowed me to bring a different perspective to the business and look at problems in the CLO and loan markets in an innovative way, imagining new solutions. To be sure, loans are complex – but they are still typical fixed income instruments. If you account for the nuances, you can create solutions to key problems in the loan market. My engineering background helped me to see that.”
Core Products
What are the company’s core products and features? Bejile explained:
“Octaura is a platform for electronically trading leveraged loans and CLOs. Octaura’s technology brings together trading, real-time data and deep analytics, enabling traders to effectively access liquidity and pursue optimal execution.”
Formation Of Octaura
How did the idea for the company come together? Bejile shared:
“It developed in several ways. First, my path at Citi as a CLO trader was impactful. As a junior member of the team, my responsibility was to do a lot of manual work – preparing analysis for senior traders, data entry, etc. I would automate my work to make my life easier (and go home earlier!). It was normal for junior people to be in the office until 2 AM, but I would create these automations to my workflow that benefited me. Then as I got more senior, it was to the benefit of my team.”
“Then, an opportunity presented itself to us. The CLO market had become much larger, and I realized we had to work more just to keep up with the workflow. We needed a different way to do these things. With my team at Citi, we built a solution to automate customer bid collections on CLO Bids Wanted in Competition (BWIC) on CitiVelocity, Citi’s e-trading portal. This was a good precursor to an important life moment because up to that point, most market participants believed that CLOs would never trade electronically. We dispelled that myth, and it wasn’t a stretch for me to imagine that a multi-dealer platform could exist. I knew we would have to create an agnostic platform and Citi said, “That’s great – if you can create a platform, we will support you”. Then I called Bank of America and Project Octopus was born, which ultimately led to the formation of Octaura.”
Favorite Memory
What has been your favorite memory working for the company so far? Bejile reflected:
“We have had a lot of great memories and hit notable milestones already. I recall fondly the day we officially launched loan trading, which was very important to our business. That day showed that we’re able to accomplish what we set out to do, but also, reinforced that we’ve assembled a great team of people that can deliver. The first launch was a big deal and very validating.”
Challenges Faced
What challenges have Bejile and the team faced in building the company? Bejile acknowledged:
“Our biggest challenge is the amount of work we must do by chipping away at addressing workflow challenges that exist in the market, while being constrained by time and resources. A lot of people didn’t think it would be possible to put together a successful loan trading platform that the industry would adopt and use, but no one thinks that anymore. Now, our challenge is prioritizing asks from clients that align with what we have and where we are going. We have a lot of what we want to do but can’t do it all at once – Rome was not built in a day, but we are dedicated to addressing all the challenges.”
“Capturing 3% of trading activity in the loan market on our platform so quickly reflects our commitment to clients. Other companies have tried to create loan platforms that didn’t work because most of the key problems clients have in the loan industry weren’t addressed. We are very focused on client challenges. For example, when we first rolled out trading products, we did bilateral trading and Request for Quote (RFQ) trading one loan at a time. But our clients are trading multiple loans at a time. So, we developed a list protocol in response to this. As a result, we have seen a large pick-up in volumes through that trading protocol. People are utilizing the functionality because they asked for it and we delivered.”
Evolution Of Octaura’s Technology
How has the company’s technology evolved since launching? Bejile noted:
“We are growing fast – by the end of the first quarter of 2024, 1% of the loan market traded on Octaura – and we reached 2% only 3 months later. We most recently hit 3% of the market.”
“I am also very proud of the fact we’ve been able to get the most important participants on the platform. From April 2023 to September 2024, Octaura has grown its loan trading platform from three dealers to 21 and from 34 buy-side firms to 131.”
Funding
When asking Bejile about the company’s funding, he revealed:
“Octaura launched with the backing of Citi, Bank of America, Credit Suisse, Goldman Sachs, J.P. Morgan, Morgan Stanley, Wells Fargo and Moody’s Analytics in 2022.”
Future Goals
What are some of the future goals for the company? Bejile concluded:
“We are excited to be launching a few new products in the coming months, including a data and analytics service that is a byproduct of the trading solution we’re building. We noticed a massive need in the market, as there are currently disparate and unreliable market data sets. We have a unique vantage point to compile data that supports trading decisions and provides insights for ongoing activity.”
“We’re also focused on a second asset class – CLOs. Trading CLOs has long been hampered by manual and time-consuming processes involving phone calls, spreadsheets, etc. We recognized these challenges and are developing a solution that combines electronic execution, advanced data, deep analytics and a full suite of connectivity for sell-side and buy-side participants in the CLO market. Loans are the Ls in CLOs, so having both on the same platform is very complementary.”
