How Market Data APIs Allow Banks to Innovate At The Speed of Fintech. Presented at the Singapore Fintech Festival 2017

1. xignite@sdubois@sdubois
THE
CLOUDIFICATION OF
CAPITAL MARKETS
How Market Data
APIs Allow Banks to
Innovate At The
Speed of Fintech

2. xignite@sdubois
MARKET DATA
IS THE LIFEBLOOD
OF FINTECH
xignite@sdubois

3. xignite@sdubois
MARKET DATA INDUSTRY
 175 Years Old
 $27.5 Billion
 +1.7% 5 Year CAGR
xigniteSource: Burton-Taylor@sdubois

4. xignite@sdubois
UBS TRADING FLOOR
STAMFORD, CT
2007

5. xignite@sdubois xignite@sdubois
UBS TRADING FLOOR
STAMFORD, CT
2015

6. xignite@sdubois Source: Bloomberg xignite@sdubois

7. xignite@sdubois
MARKET DATA INNOVATION
CLOUD APIS
Fintech Apps
TERMINALS
Front-Office
FEEDS
Mid-Office
FILES
Back Office

8. xignite@sdubois xignite@sdubois
1910’s-60’s
TICKER TAPE
1990’s
CLIENT SERVER
2000’s
WEB
2010’s
1970’s
MAINFRAME
quotron
Vehicles
Terminals
Displays
Mobile Wearables
IoT
Robo-Advisors
Trading
1,000s OF BROKERS 10,000s OF TRADERS 100,000s OF ANALYSTS MILLIONS OF USERS BILLIONS OF DEVICES xignite
EXPLOSION OF END POINTS

9. xignite@sdubois
2020 CONNECTED DEVICES
21 BILLION
Source: Gartner

10. xignite@sdubois
HOW DO YOU SERVE 20B DEVICES?
CLOUD APIS

11. xignite@sdubois
WHAT’S A CLOUD API?
• Simple To Use
• Standard Based
• Unlimited Power
www.xignite.com – San Mateo, California – Copyright © 2016. All Rights Reserved

12. xignite@sdubois
API GENERATIONS
Program
Library
Program
Program
Program
Server
Program
Cloud
Pre-History
External Libraries
(60’s)
1st Generation APIs
RPCs
(70’s-80’s)
Network
2rd Generation APIs
Web APIs
(90’s-00’s)
3h Generation APIs
Cloud APIs
(00’s-10’s)
 Local
 Not Sharable
 Complex
 Not Scalable
 Remote
 Sharable
 Complex
 Not Scalable
 Internet
 Shared
 Simpler
 Scalable
 Internet
 Mutualized
 Simple
 Zero-Footprint
Internet Internet

13. xignite@sdubois
APIS ARE 17 YEARS OLD
HTML
W3C
Standard
IMG Tag
First pointer to
resources on
external servers
JavaScript
First smart
client
capabilities
IFRAME Tag
Complex resource
embedding
1996 Flash
Complex resource
embedding
XMLHttpRequest
First Web API
Implementation
AJAX
First smart
client logic
First API
(Maps)
JSONP
Call a server
without a server
REST
Roy Fielding
publishes his
dissertation
on REST
CORBA
First
standard
RPC
First API
First API
First API
JSON
First Spec
XML
W3C
Standard
xignite
First Commercial API
First API First API
First API
S3 EC2
HTML5
First Spec
SOAP
W3C
Standard
xignite
First Cloud API
First API
1990 1991
1993
1995 1996
1999 Feb-00
2000 2001
Jul-02Nov-00 Jun-05
Feb-05 Dec-05
1996 Aug-03 Jul-04 Aug-06 Sep-06Mar-06
Sep-121998
Oct-10Oct-08 Nov-13
FINTECH
WAVE
First API
Oct-08
Jun-07 Jun-08
App Store
iPhone 1
First API
Oct-02
Jeff Bezos
API Memo

14. The Enabler
Roy Fielding’ 2000
dissertation is what
gave birth to the
world of APIs as
we know it.
It laid the foundation for the REST
protocol which is used for the majority
of APIs today.
https://www.ics.uci.edu/~fielding/pubs/
dissertation/fielding_dissertation.pdf

15. The Catalyst
Jeff Bezos’ famed internal Amazon
memo from 2002 set the internal
standard for API discipline.
This internal discipline enabled Amazon
to launch S3 in March 2006.
In 2017, AWS is a $15B business
growing 42% annually.

16. xignite@sdubois
ANDY RACHLEFF
CHAIRMAN & FOUNDER
“WEALTHFRONT
WAS ENABLED BY 3
TECHNOLOGIES:
ETFs, TRADING APIs,
AND MARKET DATA
APIS.”
xignite@sdubois

17. Xignite First API
This snapshot was taken on 10/24/2003.
It is available on http://web.archive.org.
This was a real-time US equity API based
on an INET (Island) feed.
The API supported REST.
Subscription started at $19.95/month.
Until proven otherwise, this was the first
pure-play commercial API ever.

18. Our First Fintech Clients
While many fintech high-flyers became Xignite clients early on, the fintech wave only
started taking off in late 2013.
9/2008
1/2008
4/2014
10/20113/2009
3/2011
4/2009
8/2011
Fintech
Wave
Google Trends Results for “Fintech”

19. xignite@sdubois xignite@sdubois
UNLEASHING
INNOVATION

20. xignite@sdubois
POST-CRISIS REGULATION
OPENED THE ROAD
FOR FINTECH

21. xignite@sdubois
0
500
1000
1500
2000
2500
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
20000
MARKETS AT AN ALL-TIME HIGH
DOW JONES INDUSTRIAL AND S&P500 2000-2015
$5,000,000
$500,000
$50,000 $5,000
2000 2005 2009 2011
FINTECH REVOLUTION DRIVERS
ECONOMICAL
FACTORS
SOCIAL
FACTORS
TECHNOLOGICAL
FACTORS
NEW MILLENIAL EXPERIENCE
COST TO BUILD APPS DROPPED
Maturing
Of App
Development
Scaling
of Public
Cloud
Social
Customer
Acquisition
Dawn
of APIs

22. xignite@sdubois
FINSERV BIG SQUEEZE
Fintech
User Experience
Pressures
Business Model
Pressures
Cost Structure
Pressures
Regulator
Balance Sheet
Pressures
Business Model
Pressures
Operational Cost
Pressures
Since 2013 Since 2008INNOVATION REGULATION
FinServ
INNOVATE
TRANSFORM
REDUCE COSTS
COMPETE COMPLY

23. Legacy Challenge
Market Data Legacy
• Stifles innovation
• Inhibits transformation
• Drives up costs
• Prevents controls
• Increases risks
• Slows compliance
• Is hidden from sight

24. New Thinking
Cloud

25. Industry Challenge
Industry was entirely based on the
concept of replication.
All Financial Institutions replicate the
same infrastructure ad infinitum
The weight and rigidity of all this legacy
prevents innovation and freezes the
industry as a whole.

26. xignite@sdubois
HISTORICAL PREMISE: REPLICATION
Data Vendor
Feeds Files Terminals
DATA CONSUMERS
DATA SOURCES

27. xignite@sdubois xignite@sdubois
NEW PREMISE: MUTUALIZATION
NEXT GENERATION APPLICATIONS
DATA SOURCES
OPEN CLOUD DATA APIS
OPEN CLOUD ANALYTICS APIS

28. xignite@sdubois xignite@sdubois
WHY MARKET DATA CLOUD APIS MATTER
Reducing Costs
• Eliminate inhouse hardware and software
• Mutualize infrastructure
• Remove vendor lock-in
• Improve controls and reduce spend
Driving Innovation
• Improve user experience
• Speed development
• Enable focus on business value
• Increase access to information
www.xignite.com – San Mateo, California – Copyright © 2016. All Rights Reserved

29. Attitude Towards APIs
Why do we
need a web
site?
1995
Of course we
have a web
site
2000 Most of our
business
comes from
our web site.
2005
Why do we
need APIs?
2015
Of course we
have APIs.
2020
Most of our
business
comes from
our APIs.
2025

30. Where Is The Ecosystem Growing?
Source: ProgrammableWeb

31. API Initiatives in Financial Services
Already
Launched
39%
Next 12 Months
39%
Maybe
13%
No
9%
Are you Considering the Launch of an API Initiative in
the Next 12 Months?
61%
59%
80%
29%
33%
12%
Public APIs
Partner APIs
Internal APIs
What Type of APIs Will you Be Launching?
Source: Banking APIs – The State of the Market. Axway 2016

32. The Perceived Value of APIs
0% 10% 20% 30% 40% 50% 60% 70% 80%
Innovative Services
Understand Customers
Account Access
Increased Security
Connect Services
3rd Party Apps
What Important Issues Can
APIs Help With?
Extremely Important Very Important
0% 10% 20% 30% 40% 50% 60% 70% 80%
Customer Experience
Time to Market
New Revenue Streams
Compliance
Better Data Control
Innovative Reputation
Cost Reduction
Better Security
What API Benefits Are Most
Important to You?
Extremely Important Very Important
Source: Banking APIs – The State of the Market. Axway 2016

33. API Expansion Within Banks
69%
51%
50%
31%
24%
21%
Culture/Bureaucracy
Security Concerns
Lack of Talent/Know-How
Budget
Compliance/Regulation
Technology
What Hinders The Emergence of an Open API
Initiative Within Your Firm?
54%
49%
48%
39%
37%
13%
9%
0
Product Development
Strategic Planning
CTO
CIO
Channels
Independent
Others
IT
Who Should Lead API Strategic Efforts at Your Firm?
Source: Banking APIs – The State of the Market. Axway 2016

34. xignite@sdubois
ColocationColocation
TYPICAL LANDSCAPE
 Lots of legacy in-house infrastructure
 Vendor lock-in and point to point interfaces
 Significant compliance risks and costs
 Many data silos across vendor technologies
 Reliability and maintenance issues
 Redundant or unnecessary expenses
 Rigid, expensive and innovation killer
 New app development nearly impossible
 Unable to disconnect legacy systems
 Costs continue to increase with scale
EXCHANGES VENDORS
Databases
Handlers
Databases
Analytics Engines
Databases
Tick Databases
App Servers
Cache Servers
Fanout Servers
Messaging Servers
Processing Engines
Search Engines
Trading & Algos
Handlers
Feeds FilesFeeds
Proprietary
Processing Engines
Vendor Proprietary
Servers
Redundancy
Compliance
Silos
Personnel
Upgrades
Lock-in
Point to Point
Legacy
Front-Office Mobile & Web

35. xignite@sdubois
EXAMPLE 1: REAL-TIME DATA TO MOBILE USERS
ColocationColocation
Handlers
Parsing Engines
Handlers
Feeds
EXCHANGES
Databases
Tick Databases
Fanout Servers
PROBLEMS
 Tons of infrastructure
 Peak activity scaling
 Software licensing
 Custom processing
 Complex programming
 6-12 months minimum
 Scaling lead time
 Monitoring required
 Large capex and opex
TRADITIONAL APPROACH: IN HOUSE
Silos
Redundancy
Legacy
Monitoring
www.xignite.com – San Mateo, California – Copyright © 2016. All Rights Reserved

36. xignite@sdubois
EXAMPLE: CLOUDSTREAMING API
ColocationColocation
Handlers
Parsing Engines
Handlers
Feeds
EXCHANGES
Databases
Tick Databases
Fanout Servers
CLOUD APIS
CloudStreaming
API
EXCHANGES
 Deploy instantly
 High reliability
 Scalable to millions
 No capex
 No worries
TRADITIONAL APPROACH: IN HOUSE CLOUD APPROACH
Redundancy
Legacy
Monitoring
Silos
www.xignite.com – San Mateo, California – Copyright © 2016. All Rights Reserved

37. xignite@sdubois
EXAMPLE 2: ENGAGING CUSTOMERS WITH ALERTS
TRADITIONAL APPROACH: IN HOUSE
ColocationColocation
Databases
Handlers
Databases
Analytics Engines
App Servers
Messaging Servers
Processing Engines
Handlers
Feeds FilesFeeds
Proprietary
Processing Engines
Vendor Proprietary
Servers
Redundancy
Compliance
Silos
Personnel
Upgrades
Lock-in
Point to Point
Legacy
EXCHANGES VENDORS
PROBLEMS
 Tons of infrastructure
 Huge amounts of data
 Significant integration
 Custom processing
 Complex programming
 6-12 months minimum
 Scaling lead time
 Monitoring required
 Large capex and opex
www.xignite.com – San Mateo, California – Copyright © 2016. All Rights Reserved

38. xignite@sdubois
EXAMPLE: CLOUDALERT API
CLOUD APIS
CloudAlert API
Internal Systems
 Short time to market
 Scalable to millions
 No data management
 No capex
 No worries
CLOUD APPROACHTRADITIONAL APPROACH: IN HOUSE
ColocationColocation
Databases
Handlers
Databases
Analytics Engines
App Servers
Messaging Servers
Processing Engines
Handlers
Feeds FilesFeeds
Proprietary
Processing Engines
Vendor Proprietary
Servers
Redundancy
Compliance
Silos
Personnel
Upgrades
Lock-in
Point to Point
Legacy
EXCHANGES VENDORS
www.xignite.com – San Mateo, California – Copyright © 2016. All Rights Reserved

39. The Future of APIs: Advanced APIs
Today’s Typical API Use
Get Data
Use IaaS
API
• Replicate
Cleanse
Data
Do
Analytics
• Secret
Sauce
Use IaaS
API
• Process
Use IaaS
API
•Store
Results
Tomorrow’s Advanced API Use
Consume
Analytics
Service
•Use Data
•Code
Secret
Sauce
Get
Results
•On
Demand
•No Storage

40. The Future of APIs: Self-Discovery
Today: Error-Prone Manual Process Tomorrow: Self-Discovery & Coding
Source: GoodAPI.co

41. The Future of APIs: Conversation APIs
Source: Amazon.com

42. About Xignite
Making Market Data Easy
• Cloud-based market data solutions
• Targeting fintech and financial services providers
• 1000+ customers in 55 countries
Track Record of Innovation
• 1st commercial API ever
• 1st to bring market data to the public Cloud
• 1st cloud-based market data distribution platform
• 1st market data API to reach 1 trillion hits/year level
Proven & Fast-Growing
• 55 employees
• Offices in San Mateo and New York City
• $37M raised in 3 rounds from Altos Ventures,
StarVest Partners and QUICK Corp. (NIKKEI)
• Originally funded in 2006
BNY Mellon WTC Trading Floor Displays, New York City – Powered by Xignite

43. What We Do
Vision: Empower and inspire the future of finance.
Mission: We make market data easy. Period.
Unified Cloud Solution
Control
Scale
Integrate
Simplify
Market Data CloudLegacy Data Sources
Developers &
Applications

44. The Problem: Legacy
Legacy Technologies
Database Silos
Rigid Infrastructures
Point-to-Point Interfaces
Proprietary Technologies
No Innovation
High Infrastructure Costs
Lack of Transparency
Compliance Risks
Vendor Lock-in
Investment
Analytics
Trading &
Capital Markets
Compliance &
Risk
Wealth
Management
Reporting &
Accounting
Front-Office Mid-Office Back-Office
TERMINALS
Front-Office
FEEDS
Mid-Office
FILES
Back Office

45. The Solution: Market Data Cloud
Mutualized Data
No Infrastructure
Lower Costs
Easy Innovation
Rapid Time to Market
Painless Deployment
Control over Data
Optimization of Spend
Usage Transparency
Investment
Analytics
Trading &
Capital Markets
Compliance &
Risk
Wealth
Management
Reporting &
Accounting
Front-Office Mid-Office Back-Office
Cloud Data
APIs
Cloud Data
Distribution
Digital Channels Enterprise & EDM Systems
Hosted DataLicensed Data
Emulated APIsOpen APIs

46. Data Coverage
Real-Time
Data
Fundamental
Data
Historical
Data
1.2M
Equities
250K
Funds
6,500
ETFs
3.5M Fixed
Income
5M
Derivatives
27K
Forex
Master
Data
• Identifiers
• Descriptors
• Classification
• Quotes
• Historical Prices
• Intraday Ticks2 and Bars
• VWAP/TWAP
• Market Movers
• IPO Details
• Corporate Actions
• Symbol Changes
• Delisted Securities
• Historical Financials
• Analyst Estimates
• News
• Institutional Holdings
• Insider Data
• Etc.

47. Global Coverage

48. Multiple Delivery Methods
CloudAPIs
• HTTP REST APIs
• XML, JSON, CSV
• For most apps
CloudFiles
• FTP/SFTP Files
• XML/CSV output
• For large data sets
CloudStreaming
• HTTP Streaming
• JSON patch
• Stream to device
CloudWidgets
• HTML5 Widgets
• Web Site Insertion
• For web sites
CloudAlerts
• Rule-based Alerts
• Via API call-backs
• For high volumes
CloudAddin
• Simple Paradigm
• Easy Excel Add-in
• For end users
48
Easy – Scalable – Integrated – Customizable

49. xignite@sdubois
xignite
5 Million
Data APIs
Served