480: The FinTech Startup Using Machine Learning Disrupt Asset Management
Pagaya is a fintech company using machine learning and data analytics to reshape the asset management space. Armed with a unique technology platform — Pagaya Pulse, it runs on a suite of artificial intelligence technologies and state-of-the-art algorithms to deliver a consistently high and scalable performance edge. The company appeared on my radar after announcing its launch in the U.S. with $75MM in debt financing from Citi. The funding will be used to create a new leveraged fund suite called the Opportunity Fund.
Backed by Viola Ventures and the Viola Group private equity firm, Pagaya has built the first comprehensive loan level database utilizing a hybrid of machine learning and financial technologies to source alpha to its short duration, high yield portfolio strategies. Our maiden fund has raised capital to date from Israel’s largest bank, Bank Leumi, Israel’s largest asset manager Meitav Dash, and Excellence, a leading Israeli pension fund, among others.
Financial technology has come a long way to improve the experience of individual investors, but there has been little progress made at the institutional level. After learning that the company also secured a 20-year BlackRock veteran as chief investment officer, I wanted to find out more about how the FinTech startup is working with the largest lending marketplaces to retool the backend and deliver better returns for institutions.
Founded in Tel Aviv in 2016, Pagaya has raised $200MM in capital to date, mainly from institutional investors. Utilizing state-of-the-art, machine learning algorithms, Pagaya also serves the institutional markets with a focus on independent, alternative asset management.
Being highly data-driven and fragmented in nature, scaling up investments in alternative credit, including consumer credit, demands a new approach–one in which traditional tools & investment strategies become increasingly irrelevant. Pagaya CEO, Gal Krubiner shares his FinTech StartUp story and how he specializes in innovative & sophisticated credit structure products (ABS structures).