FinTech: Clarity AI Raises $15M For ESG Platform
Clarity uses AI to help investors gauge the societal impact of their portfolios.
Clarity AI is a fintech whose proprietary technology platform enables investors to understand the social and environmental impact of their portfolios. It is, therefore, a useful tool in the current times when ESG is front-of-mind for both retail and institutional investors.
It announced the closure of a $ 15 million funding round led by Deutsche Börse and Mundi Ventures. (Qontigo)
Big data and AI
Clarity compiles data on publicly traded securities from multiple sources to assess companies’ social and environmental impact. Its database includes over 30,000 companies, 187 local governments, over 200,000 funds – across 198 countries.
Rebeca Minguela founded Clarity AI in Madrid in 2017.
Minguela stated: “Our purpose is simple: to measure the impact of companies on our society and planet. Investors attempting to evaluate impact have faced fragmented and unreliable data, inconsistent subjective definitions, and a lack of standards and tools for comprehensive analysis. Historically it has been too hard and resource-intensive to get accurate and transparent insights. Clarity AI aims to provide a solution for that.”
Clarity offers an end to end software as a service (SaaS) tool and an API for its customers. They have access to the entity’s integrated financial and social impact information. As well, advanced functionalities such as portfolio rebalancing, recommendations, and reporting.
COVID-19 a trigger
The virus pandemic has increased the global focus on ESG and that has paid off for Clarity.
During the last six months, it experienced a significant increase in demand for its services. It signed clients with eight times the assets under management compared to the preceding period.
Use of Funds
The company will use the funding to scale up its proprietary technology and artificial intelligence as well as develop integration with financial service platforms.
Minguela said the start-up was scaling up its business to enable investors to identify and support those companies which are taking positive action to solve society’s biggest challenges.
“2020 has seen extraordinary volatility and uncertainty – from COVID-19 to social justice protests,” she said. “It has never been more important for investors to have accurate insights on the true impact of the companies in which they place their trust and their money.”
Related Story: How the Pandemic Could Affect ESG Investing (and ETFs)
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