Clear Street closes $270m at $2bn

Clear Street, a prime brokerage platform for institutional investors that is building modern infrastructure for capital markets, has raised $270 million in the second tranche of a Series B funding round, with a total valuation of $2 billion. Growth equity firm Prysm Capital led the financing, bringing the round total to $435 million. New York-based Clear Street raised the first tranche of the round in May of 2022 at a $1.7 billion valuation, with Prysm leading the first round of funding. The company has 400 employees and makes money by charging fees for transactions and financing public market securities.

Clear Street built its cloud-native prime brokerage and clearing system from scratch, with the goal of maximising returns while minimising risk and cost for its clients. These clients include roughly 200 institutional-sized investors and hundreds of smaller active trading entities, and the company’s executives aim to serve a variety of investor types across multiple asset classes on a global scale. The prime clearing platform processes 2.5% of the gross notional US equities volume, which amounts to about $10 billion in daily notional trading value of US equities.

Clear Street plans to use the new capital to expand into new markets and asset classes and to expand its product offering to support the clearing needs of market makers. Over the past year, the company has seen the number of institutional clients on its platform increase by 500%, its daily transactional volume increase by more than 300%, and its financing balances increase by nearly 150%. Clear Street launched capital introduction and repo businesses in the last year and made key hires in Europe and in the derivatives space.

Matt Roberts, co-founder and partner at Prysm Capital, believes Clear Street is unique in terms of its “differentiated user experience, real-time risk analytics and tools, and scalability” of its platform. Other backers in the company included NextGen Venture Partners, IMC Investments, Walleye Capital, Belvedere, NEAR Foundation, McLaren Strategic Ventures and Validus Growth Investors. In total, Clear Street says it has $700 million “in capital,” including its external raise. Prysm maintains a minority stake in the company.