Chasing Returns is putting emotional intelligence into fintech

20 Nov 2017

From left: CEO Ann Hunt, chief data scientist Yulia Plaksina, senior developer Luis Almeida, and customer success head Orlaith O’Sullivan. Image: Chasing Returns

Our Start-up of the Week is Dublin’s Chasing Returns, which has developed a platform to help financial traders overcome psychological biases.

“Retail traders who work alone and part-time, often with other careers, are 10 times less likely to be profitable than the professional traders who have risk managers and risk tools,” explained the founder and CEO of Chasing Returns, Ann Hunt.

“The Chasing Returns suite of products acts as a digital risk manager.”

‘It is not just a trading problem, it is a challenge for all of us in our every day decisions’

Working on the maxim that the human mind determines success or failure in financial trading, Chasing Returns’ core products, PlayMaker and GamePlan, help traders to turn psychology to their advantage.

The market

Hunt said that the target market is 10m active retail traders globally, and that this is growing quickly.

“We are specifically targeting traders who leverage the ability to take positions that are larger than our actual trading capital, like FX (foreign exchange) and CFD (contract for difference) traders.

“Our software is provided to traders via their brokers. We solve two key problems.

“PlayMaker helps with acquisition, making it easier for traders to manage their discipline and successfully navigate their first 100 trades.

“GamePlan is our retention tool, which helps traders last the course and become confident successful traders.”

The founder

Hunt spent 10 years on Wall Street building risk technology for traders.

“I saw firsthand how the use of smart technology helped traders to better returns. I also saw the impact that a risk manager has on a trading floor.

“When markets get heated and a trader starts to trade emotionally, they are often the last person to know they are going to blow up. Risk managers remove traders from these situations when the warning signs are clear, and I built Chasing Returns tools to emulate that for retail traders.”

Hunt has also worked with a number of successful start-ups, most recently Brite:Bill (sold to Amdocs) and Clavis Insights.

“So I’ve spent a lot of time helping to scale start-ups to success.”

The technology and the psychology

Hunt explained that Chasing Returns’ technology is built around the company’s analytics engine, which identifies, measures and puts a cost on users’ behaviour.

“We work with neuroscientist partnership ReThink Group and their thought leader, Denise Shull, to map human trading behaviour. We call it ‘emotions as data’.

“We believe the future of human performance lies in our ability to overcome the psychological biases clearly identified originally by Daniel Kahneman and brought to the fore again this year by the winning of a Nobel Prize in Economics by Richard Thaler.

“It is not just a trading problem, it is a challenge for all of us in our everyday decisions.

“We convince ourselves we are making rational decisions but actually, we are completely driven by the factors around us like sleep, stress and previous near-term experiences we don’t even realise are impacting us.

“Our goal is to bring our guided decision-support platform initially to the financial trading arena.

“Longer-term, we want to look at other decision-making areas to help guide people to be in the correct circumstances to make really big decisions – or, at a minimum, to know what psychological factors are at play, which helps influence better judgement.”

Chasing Returns has traders in 33 countries using its software.

“We are about to launch a partnership with a large Tier 1 global broker, which will cement Chasing Returns as the tool of choice for brokers to attract and retain clients. We have a number of similar deals in the pipeline.”

In terms of funding, Hunt said that 2018 will be a pivotal year and it is planning to raise €750,000.

“The money is for sales and marketing, and to fund our delivery team to deliver globally at scale quickly.”

Hunt said that hard work and luck have sustained Chasing Returns so far.

“We’ve got great investors who are from the industry and really understand what we are trying to achieve. We hire on a global base to ensure we have the strongest people for the job, regardless of where they live.

“We have stayed as a small team until now, making us extremely responsive, agile and focused.

“In our first year, we were supported by NDRC and participated in their Launchpad programme, which gave us a great starting position to grow from.”

Focus is everything

Hunt said that Chasing Returns has a global focus. “This is mostly driven from London, so we don’t get to spend a lot of time in the Irish start-up scene. But I am continually surprised at the super high quality and great ideas that I hear when I do meet people.

“Also, there is a very strong bond of support in Dublin, where it’s very easy to reach out and get people to help or give advice, which is a fantastic support for founders.

“As a female founder, I particularly applaud groups like Going For Growth, who run an amazing mentoring programme for female founders. This really helped me build my network of advisers and gave me a forum to enlist expert advice for specific business challenges.”

Her advice for fellow founders is not to get caught up in the hype curve.

“I hear a lot of people spending too much time worrying about (and trying to raise) money, and less time trying to get to revenue. I think it’s important that we don’t reward ourselves on ‘money raised’, which there is a tendency for start-ups to do.

“It seems crazy to me that ‘Company X is really successful, they raised Y millions’ because it’s the ultimate vanity metric that we should be careful about.”

Want stories like this and more direct to your inbox? Sign up for Tech Trends, Silicon Republic’s weekly digest of need-to-know tech news.

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