Microsoft takes 15pc stake in small investor start-up

11 Jun 2008

Microsoft has taken a 15pc stake in a young software company that has created the tools to fill a major gap in the global market of small investors.

Through its IP Ventures division, Microsoft has invested in a Dublin company headed by Irish Software Association chairman Pat Brazel called Zignals.

Zignals uses Microsoft’s Solver technology and other technologies like Silverlight to provide retail investors with personalised decision-support tools over any kind of device.

Entrepreneur Scott Tattersall who co-founded Zignals said that while institutional investors, stock brokers and merchant banks are well supported via technology, there is a major absence of personalised decision-support tools for the thousands of small investors who make up 90pc of the finance market.

“The end market we perceive is the individual private investor,” said Tattersall. “There’s a gap in the market between the high net worth individuals with sufficient capital and the day traders who manage portfolios day by day. The guys in the middle, the private investors, who make up 90pc of the market, don’t have the tools to track investments day by day. That’s about to change.”

Tattersall told that Zignals has so far raised €2.5m in private equity finance from investors including Manresa Partners, Enterprise Ireland and a number of private investors.

David Hartnett, a former Enterprise Ireland executive who now heads up Microsoft IP Ventures, told “Zignal’s technology effectively cranks hundreds of thousands of variables to come up with the optimal solution to support small investors’ decisions.

“It’s basically a web service for individual investors that allows them to create and manage their portfolios and cut through market data.

“There are over 100 million investors in the world today who don’t have such tools to manage their portfolios and this technology uses Microsoft’s Solver technology to allow them crunch the numbers,” Hartnett said.

Microsoft’s IP Ventures programme was established in 2005 in order to leverage the company’s IP to support early stage technology companies.

In 2006, Enterprise Ireland signed a formal agreement with Microsoft to facilitate product and business development opportunities for entrepreneurs and SMEs.

In a similar deal to Zignals, two years ago Dublin-based Vimio signed an agreement with Microsoft to license the software giant’s video-optimisation technology to strengthen its offerings in the world of mobile media distribution.

“We are greatly encouraged by the strong partnership with Microsoft that will bring an exciting innovation to the market while creating a new enterprise in Ireland,” said Frank Ryan, chief executive of Enterprise Ireland.

By John Kennedy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years