2020 Outlook: Mike Cashel, OpenDoor Securities
Mike Cashel is COO at OpenDoor Securities.
What were the key themes for your business in 2019?
The major drivers for OpenDoor 2019 were derived from a great deal of feedback from clients. First and foremost, while it was important at the outset to have scheduled sessions to concentrate liquidity, as we have grown, clients have encouraged us to offer continuous crossing, so that they can search for and rest liquidity in our system when it suits them, instead of when the next scheduled auction takes place. Anticipating the volume increases that continuous crossing can bring, we’ve focused on hardening the technology stack, offering new trading protocols and creating the ability to facilitate straight-through processing of order flow. Our focus on our clients and solving for their needs provides an exciting opportunity to scale our business as we move into 2020.
What are your expectations for 2020?
We have bold plans for 2020. First, we will demonstrate that the major initiatives we focused on in 2019 were the right ones. We will measure success through client acquisition, increasing the number of resting orders, and executed trade volumes on the platform. Our goal with each execution will be to deliver measurable savings in both the implicit and explicit costs of trading. We will be undertaking a funding round early in the new year. The funding round will facilitate more rapid expansion in our key market, Off the Run Treasuries and TIPS, but will also allow us to build out our data offering, expand into new time zones, and explore new protocols in new markets where the unique attributes of our model with help institutional investors discover sizable trading opportunities while minimizing market impact. We fully expect to be cash-flow positive by the end of 2020.
What are your customer’s pain points and how have they changed from a year ago?
The conditions that led to the foundation of OpenDoor in the first place are only getting more acute. In a world of continually increasing issuance and shrinking dealer balance sheets, due to both regulation and decreasing profitability, the buy side is more and more open to becoming price makers. Therefore the importance of protecting information and data related to their trading intentions is vastly more important than it was a year ago. OpenDoor intends to be an additive technology that traders can use in their effort to improve outcomes for their clients.
Firms are accelerating the buildout of digital transformation strategies.
Expect to see several new entrants in the equity exchange landscape.
CEO sees big potential for financial innovation in digitized assets.
Capital markets will continue to integrate and globalize.
SFTR implementation and the demise of LIBOR will be key themes this year.