OneChronos raises $32 million to expand its AI-powered smart markets technology – AlleyWatch

In the rapidly evolving financial technology landscape, traditional trading mechanisms have long struggled to optimize transaction efficiency and maximize value for institutional investors. The complexity of matching transactions in real time while minimizing market friction is a persistent challenge for electronic capital markets. UnChronos transforms this paradigm by leveraging advanced auction theory and sophisticated algorithms to create intelligent markets that fundamentally reinvent trade execution. Through its innovative matching technology that uses combinatorial auctions to identify bilateral and multilateral trades, OneChronos created an Alternative Trading System (ATS) that quickly became the leading off-exchange U.S. equity trading platform. the fastest growing, facilitating on average more than $4.5 billion. in daily transaction volume. The company plans to soon bring its unprecedented speed, scale and computing complexity to the new smart markets for European equities and foreign exchange. It also plans to introduce the technology to non-financial trading markets.

AlleyWatch met the co-founder and CEO of OneChronos Kelly Little Page to learn more about the company’s inspiration, the company’s strategic plans, the latest funding round and much more…

Who were your investors and how much did you raise?

We recently announced a $32 million expansion capital investment led by Addition. This follows our $40 million Series B round in September 2023, also led by Addition.

Tell us about the product or service offered by OneChronos.

OneChronos designs and operates markets known academically as Smart Markets. These markets use mathematical optimization to find trading outcomes that maximize individual and collective profit. Matching buyers and sellers is rarely a zero-sum game, and smart markets will change the way we exchange goods and services across society, bringing huge efficiencies and a level of fairness to the global economy.

OneChronos’ first marketplace is a US equity trading platform, OneChronos ATS. We are launching additional platforms based on the same technology for European equities and foreign exchange. Beyond capital markets, we see a future in which agentic AI will play an important role in the global economy and in which intelligent markets will be the bazaar where AI agents do business. OneChronos strives to build this future and leverage advances in machine learning and artificial intelligence to design and operate intelligent marketplaces at scale.

What inspired the launch of OneChronos?

I met my co-founder, Stephen Johnsonin college, and we quickly became lifelong friends after bonding over our shared interests in math, computer science, and science. We went to college on opposite coasts but never lost touch. We found ourselves in different sectors but in similar technical fields. I started my career as a quant in e-commerce, and Steve in distributed systems and information security. We discussed how fragmented capital markets were distributed systems, but were not formally treated as such, leading to enormous technology costs and missed business opportunities. Caltech exposed me to auction theory and smart markets, and we also discussed how sophisticated bidding in markets like display advertising compared to capital markets. Unfortunately, operating smart markets at the pace and scale of capital markets was not then a technical possibility. This changed in 2015 when it became clear that the advances in AI and ML that made AlphaGo possible also applied to smart markets and that we had both a technical path forward and a a tremendous opportunity to evolve the capital markets.

How is OneChronos different?

Traditional capital markets connect buyers and sellers through a double auction that pits the more expensive buyer against the cheaper seller. We design and operate intelligent marketplaces that enable buyers and sellers to express their wants and needs in ways that identify bilateral and multilateral exchanges that can lead to better outcomes individually and collectively. The work behind the 2020 Nobel Prize in Economics, awarded to Bob Wilson and Paul Milgrom, laid the foundation for what we do. Our first product, OneChronos ATS, validated the approach in capital markets. We accumulate hundreds of thousands of data points daily on how smart markets can produce mutually better economic outcomes than limit orders, an auction format dating back to antiquity.

What market is OneChronos targeting and how big is it?

Our current market is US equities, where we currently process over $4.5 billion in daily trading volume. But that’s just our starting point. We see enormous opportunities in capital markets and beyond, including in the compute, energy and transportation markets, where traditional trading mechanisms leave significant value untapped. We have facilitated over $500 billion in institutional securities transactions since our launch in 2022.

What is your business model?

Our business model leverages smart markets powered by our combinatorial auction technology. We generate revenue by facilitating trade and optimizing institutional measures of trade quality. Our platform integrates with existing marketplace infrastructure, allowing businesses to access our enhanced execution capabilities through their current workflows.

How are you preparing for a possible economic downturn?

Economic downturns can result in less liquid and less efficient markets. In such an environment, it is even more important that markets reduce friction, facilitate trade, and produce mutually beneficial economic outcomes for participants. So we can better prepare ourselves by doing just that, which is what we already focus on every day.

How did the financing process go?

We are fortunate to have the support of fantastic financial partners like Addition, Green Visor and Y Combinator. We are also fortunate to experience explosive growth. Although we did not need capital to continue on our current path, it has become clear to everyone that there is an opportunity to grow even faster while capturing new and emerging markets, which we are excited to tell you about more next year.

What are the biggest challenges you faced when raising capital?

We are a deep technology company that has tackled a nuanced market for its first product. Each of these factors, taken individually, can constitute a difficult increase. The metrics speak for themselves these days, but our early backers had to roll up their sleeves and understand the thesis, which, given the nuance, was a big ask. We are very grateful to those who did.

What factors about your business caused your investors to write the check?

Above all, our proven execution and success in the equities space: our current average daily trading volume is 5.5 times higher than our November 2023 average. This is in addition to our unique technological advantage, as we are the only platform applying combinatorial auctions to capital markets at millisecond speeds. Finally, our potential for expansion: we have proven our model in equities and investors see that our technology can be applied to optimize transactions across multiple markets and sectors.

What steps do you plan to take over the next six months?

Over the next six months, we plan to use these funds to accelerate the growth of our core equities business, launch smart markets for new asset classes and geographies, and begin exploring opportunities across beyond traditional capital markets.

What advice can you give to New York businesses that are not benefiting from a new infusion of capital into the bank?

Fundraising is neither an automatic creator nor a byproduct of success. Focus on unit economics and build a good business that doesn’t depend on it. And if your business needs start-up capital, force yourself to start with what seems like a small amount. The thought process it takes you through is valuable in itself.

Where do you see the company evolving in the short term?

We are laying the groundwork to create new markets in sectors where there is constant demand to acquire several different assets – areas such as IT resources, energy markets and transportation. Our vision is to transform the way goods and services are exchanged in society through AI and advanced market design.

What’s your favorite fall destination in and around the city?

Prospect Park. Each season offers a different experience, but the golden leaves and cool weather make for great racing.

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