The electronification of markets is the single most significant transformation happening in finance. Most progress to date has been in equities, however, while the bond market has been slower to adapt. Even within fixed income, much of the buzz has been around digitizing the secondary markets — that is, transforming the way existing bonds are bought and sold.
But when it comes to primary markets, Raja Palaniappan saw an opportunity. Seven years into a career as a credit-default swap trader at Nomura and Credit Suisse, Palaniappan cofounded Origin to respond to frustrations with the outdated, manual way in which new corporate bonds are issued.
Palaniappan, who began his career at Lehman Brothers in London just weeks before its bankruptcy in 2008, was taken aback by all the administrative work the bond-issuance process requires of junior traders.
"I was sort of amazed at how investment banks recruit from the top universities, and these students have all spent the last three to four years sharpening their minds … and then if you look at what they do, the intellectual component is like 10% of the day and 90% of your day is a process,” Palaniappan says. “You don't need the best graduates from HEC and MIT to do the process work.”
Origin offers an online marketplace where frequent bond issuers can connect with investment banks and communicate their borrowing needs. It also provides digitalized documentation and post-trade products, automating the paperwork typically done by junior staffers.
Palaniappan says his education in electrical engineering has served him well, especially when combined with his years of experience in finance.
"It really helps to have an understanding of what it actually takes from a technical perspective," he says. “You have to have both the knowledge of the product but also the knowledge of your customers."