Nick Storonski has spent the last decade revolutionizing the banking industry with his financial-services firm Revolut, and now the billionaire former Lehman Brothers trader is trying to achieve the same feat in venture capital.
Storonsky founded a quantitative investing firm that targets early-stage companies and uses algorithms and artificial intelligence rather than human intervention to find deals. Founded in 2022, QuantumLite has invested in nearly a dozen startups over the past year after raising about $200 million for its first fund led by Storonsky.
The London-based firm also invested in health-care-focused startup Rad AI in recent weeks, the fund’s fourth investment this year despite a slump in the venture sector. QuantumLite is currently finalizing another deal, according to a person familiar with the matter.
While many startup investors brag about their companies’ clever use of data, QuantumLight positions itself as an outlier.
“We’re quite different from a traditional venture,” said Chief Executive Ilya Kondrashov, 38, in an interview at Revolut’s London office. “It’s quite logical that what we’re doing exists.”
Storonski, 39, is part of a growing number of European tech billionaires who are expanding their assets beyond their core businesses to invest in venture capital.
Zinal Growth, the family office of Checkout.com founder Guillaume Pouzat, has invested in at least two dozen startups since 2021, while Spotify Technology SA’s Daniel Ek’s investment firm last year put 10 million euros ($10.7 million) into a Swiss startup working to curb aging.
Pousaz and Ek have a combined net worth of about $10.4 billion, while Storonski, Revolut’s co-founder and CEO, is worth about $4 billion, according to the Bloomberg Billionaires Index.
More accurate
Revolut reported its 2023 results this week, showing revenue nearly doubling to $2.2 billion. The timely release of audited financial statements could help the company win approval for a U.K. banking license, which has been long delayed in part because of Revolut’s accounting issues.
Storonski, who founded Revolut in 2015, has put about $60 million into QuantumLite’s fund. In an emailed statement, he said the venture’s strategy allows machines to make decisions faster and more accurately than humans can, and he hopes such methods will play a bigger role in the startup trading market.
“These systematic strategies will gain significant market share,” he said. “Just as Revolut is challenging traditional banks, QuantumLite has ambitions to take on the big players.”
While quantitative investing has been a powerful force in public markets for decades, systematic investors have generally steered clear of private assets because a lack of public data makes it hard for analysts to look for profitable patterns or disruptions. But that’s changing fast, with Wall Street firms looking to get an edge in the recent booms in private equity and credit, and investment firms including Ares Management and BlackRock hiring quantitative analysts who come from data-driven sectors of the financial industry.
Quantum Light similarly employs a handful of data engineers among its roughly two dozen employees, but it remains a relatively small firm for a venture capital firm.
Some venture funds are using AI models to sift through potential deals, but those tools are not as important as investor networks, said Claudia Zeisberger, senior associate professor of entrepreneurship at the business school INSEAD.
“At the end of the day, in venture capital, money isn’t the differentiator,” she says. “It’s the soft stuff, opening doors and things like that that’s important.”
QuantumLight calls itself the “first truly systemic” venture firm, and raised capital for its first fund from other tech founders and family offices.
Kondrashov said executives at portfolio companies have access to a “playbook” based on Storonsky’s experience growing Revolut from a small company focused on prepaid debit cards into one of Europe’s most valuable startups, offering bank accounts, money transfers and stock trading.
Kondrashov, a Cambridge graduate and former Goldman Sachs Group Inc. analyst who previously started his own fintech company, Kriya, in the U.K., said Storonsky remains a key figure at QuantumLite.
“He is involved in all the major decisions,” Kondrashov said.
The pair first met at an entrepreneurs’ dinner in central London before the pandemic, then reunited when Storonski began launching QuantumLite in 2022. The fund, which made its first deal in July 2023, allocates around $5 million per investment.
Kondrashov said he plans to continue investing at a steady pace for the next three years or so and has no immediate plans to raise a new fund.
“We’re probably going to be doing about one deal a month,” he said. “We’ve raised all the capital we need.”
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