Founder Securities Boston Consulting Group Matrix
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Stars
Leading equity underwriting (A‑share IPOs)
Leading equity underwriting (A‑share IPOs) drives high-growth listings for Founder Securities, with underwriting fees typically around 2% of deal value, creating a sizable fee pool that offsets heavy roadshow, research and distribution spend.
Strong league‑table presence and brand pull make this a headline engine; maintaining market share preserves momentum as issuance normalizes.
It consumes cash now but can mature into a cash cow—invest, don’t coast.
Digital retail brokerage app
Mobile-first trading continues to expand as retail investors drove roughly 20% of US equity volume in 2024, and Founder’s active user base is climbing. CAC is real, yet higher engagement and order flow recover acquisition costs over months. Push UX, zero-friction onboarding, and smart insights are required to defend share. Win the screen, win the wallet.
Sector-leading research franchise
Analyst credibility fuels IB mandates and trading volume, creating a growth flywheel that supports Founder Securities; 2024 global investment banking fees were roughly $78.5bn, underscoring persistent fee pools research can tap. Content costs are high but convert to influence and referrals; doubling down on data tools and differentiated coverage raises conversion and retention. In cooler markets, flagship research still anchors visible fee streams.
Tech/innovation ECM pipeline
Tech/innovation ECM pipeline is a Star: strong 2024 policy tailwinds and elevated investor appetite kept deal velocity high, with global tech IPO proceeds surpassing $80B in 2024, driving outsized franchise visibility.
These deals demand heavy preparation, robust valuation work and investor education; landmark transactions in 2024 set pricing power across the firm and justify dedicating senior banker time, which multiplies returns.
- Policy tailwinds: sustained in 2024
- Deal velocity: high, >$80B tech IPOs 2024
- Requires: deep prep, valuation, education
- Impact: pricing power, senior banker leverage
Electronic institutional execution
Algorithmic and low-latency flows grew sharply in 2024, now ~70% of institutional electronic volume with spreads tightening ~12% YoY; building pipes costs roughly $5–20M but once share is won it’s sticky. Performance plus concierge service cuts block slippage ~25%, so scale fast before rivals crowd in.
- algorithmic, low-latency, sticky-share
A-share & tech IPO engines: fee power, retail lift and sticky algo flow
Founder Securities Stars: A‑share IPO underwriting (fees ~2%) and tech ECM (> $80B global tech IPOs 2024) drive high-growth listings and pricing power; strong league‑table share preserves fee pools as issuance normalizes. Retail/mobile contributed ~20% of US equity volume in 2024, boosting order flow. Algo/low‑latency ~70% institutional e‑volume enhances sticky flow once scale is reached.
| Metric | 2024 | Implication |
|---|---|---|
| Underwriting fee | ~2% | Large fee pool |
| Tech IPOs | >$80B | Franchise visibility |
| Retail share | ~20% | Order flow lift |
| Algo vol | ~70% | Sticky scale |
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Cash Cows
Traditional cash equities brokerage
Traditional cash equities brokerage sits in a mature market with stable client books and predictable commissions; in 2024 many incumbents reported trading-driven revenue contributing 60-75% of retail brokerage turnover. Low promotional spend means efficiency — improving routing and cutting unit costs by 10-20% materially lifts margins. Milk responsibly while cross-selling wealth management to raise lifetime value.
Margin financing book
Margin financing book delivers recurring interest income, with industry margin-lending rates averaging about 8–10% APR in 2024 and well-managed NPLs typically below 1% for disciplined books.
Growth is modest, contributing roughly 20–30% of operating revenue in comparable brokers in 2024, helping balance the P&L while paying the bills day in, day out.
Tighten risk controls, automate real-time monitoring and keep churn under 5% annually to maintain steady returns and manageable capital exposure.
Bond underwriting for established issuers
Bond underwriting for repeat SOE and blue-chip issuers delivers steady fee pools (typically 10–30 basis points) with limited glamor but low volatility and high process mastery. Volume predictability and client stickiness mean revenue variance is modest versus capital markets desks. Investing in workflow automation can shave hours per deal and raise throughput materially. Reliable cash from these mandates underwrites higher-margin, brand-building activities.
Asset management core index/vanilla funds
Founder Securities asset-management core vanilla funds sit on large AUM with low growth but a reliable fee base; passive strategies now account for >50% of US equity AUM in 2024, and global ETF assets were about $11.7tn in 2024, making these funds opex-light at scale and brand-sticky.
- Large AUM, low growth
- Decent recurring fees
- Opex light once scaled
- Protect TERs, cut tracking error
- Ballast in market stress
Custody and clearing services
Custody and clearing services serve as infrastructure with entrenched client relationships and high switching costs, protecting Founder Securities’ share while upsell opportunities remain incremental; global assets under custody exceeded $100 trillion in 2024, underscoring scale-driven durability.
- Entrenched relationships: high switching costs
- Scale: >$100T AUC (2024)
- Strategy: automate, standardize, price smartly
- Margin profile: quiet but durable
Brokerage fuels cash flow: 60–75% turnover; margin 8–10% APR; custody > $100T
Founder Securities cash cows: brokerage trading drives 60–75% of retail turnover with unit-cost cuts of 10–20% boosting margins; margin lending yields ~8–10% APR with NPLs <1%; custody/AUC scale >$100T and AM passive exposure taps $11.7tn ETF pool, providing predictable fees to fund growth initiatives.
| Product | 2024 Metric | Role |
|---|---|---|
| Retail brokerage | 60–75% revenue; -10–20% unit cost | High cash generation |
| Margin lending | 8–10% APR; NPL <1% | Recurring interest |
| Custody/clearing | >$100T AUC | Durable fees |
| Asset mgmt | $11.7tn ETFs | Opex-light fees |
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Dogs
Legacy desktop-only trading terminal
Legacy desktop-only trading terminal shows steady user decline as mobile and web apps grew; global mobile web traffic reached about 58% in 2024, shifting active traders off desktop. High maintenance and little differentiation tie up support resources with minimal return, consuming disproportionate engineering cycles. Sunsetting or full redesign beats patching—don’t let nostalgia tax the roadmap.
Low-traffic third‑tier city branches
Low-traffic third‑tier city branches show footfall down roughly 40% since 2019 and cost per new account often exceeds branch-originated revenue, making turnarounds rarely pencil out. Consolidate, relocate, or convert underperforming units to low-cost service kiosks to cut fixed costs. Reallocate savings to digital channels—digital transactions comprised over 70% of trades in 2024 at many brokers—freeing budget for scalable growth.
Niche commodities brokerage experiments
Niche commodities brokerage experiments sit in Dogs: tiny share (under 1% of Founder Securities 2024 revenues), thin margins (~2%), and not core to the equity/bond spine. Compliance overhead often exceeds collected fees (internal cost ratios can surpass 100%), so either bundle into partner platforms or exit gracefully. Exiting avoids a cash trap; cash preserved is cash earned.
Small-cap ECM in illiquid segments
Small-cap ECM in illiquid segments is increasingly hard to place; 2024 hit-rates in comparable markets run below 40%, making reputational risk real when deals fail to fill. Fee pools for sub-50m transactions average under 1%, so banker hours rarely justify the grind. Redirect origination and execution capacity to higher-quality pipelines; trim marginal mandates rather than chase low-probability deals.
- Reputational risk: failed fills harm long-term placement power
- Economics: fee-to-deal ratios <1% on small illiquid deals (2024)
- Action: reallocate banker hours to higher-conviction targets
- Strategy: prune, don’t pursue marginal mandates
Underused proprietary analytics tools
Underused proprietary analytics tools are a great idea but, as of 2024, adoption remains limited and upkeep drains engineering cycles; if trading desks and PM teams won’t embed them they will not pay back. Be blunt: kill or license out—stop carrying dead code that ties up resources and increases technical debt.
- Tag: adoption-low
- Tag: upkeep-costly
- Tag: license-or-kill
Legacy desktop decline; mobile/web ~58% — cut low-yield branches, exit niche plays
Legacy desktop terminal shows steady user decline as mobile/web rose to ~58% global traffic in 2024; maintenance drains engineering with minimal ROI.
Low-traffic branches down ~40% since 2019; cost per new account often exceeds branch revenue—convert or close.
Niche commodities <1% of 2024 revenue, margins ~2%; small-cap ECM hit-rates <40% and fee pools <1%—exit or bundle.
| Item | 2024 Metric |
|---|---|
| Mobile traffic | ~58% |
| Branch footfall | -40% vs 2019 |
| Niche rev | <1% |
| Small-cap hit-rate | <40% |
Question Marks
Wealth management for affluent/upper‑mass clients
Affluent/upper-mass wallets are fast-growing—global mass‑affluent AUM reached an estimated $35 trillion in 2024—yet Founder’s share remains small; requires broader product shelf, certified advisors, and digital planning tools to convert flows. Invest to build trust and recurring AUM quickly, or partner if go‑to‑market speed lags; with the right hybrid advisor + tech model Founder could flip this Question Mark to a Star.
Green bonds and ESG advisory
Policy push is strong with EU sustainable finance rules and growing US disclosure focus, and sustainable assets topped $35.3 trillion in 2023 (GSIA), driving emerging issuer demand for green bonds and ESG advisory. Founder’s credentials are forming but not dominant—build rigorous frameworks, third-party verification ties, and 3–5 case studies quickly to signal capability. Land a few signature mandates to demonstrate impact; each mandate accelerates referral and deal flow, creating a scalable flywheel.
OTC derivatives and structured products
Client appetite for hedging and yield is rising even as global OTC notional outstanding tops $600 trillion (BIS), but Founder lacks scale to capture volumes. Modern risk infrastructure and pricing engines require material capex—industry practice in 2024 shows platforms typically start at multi-million dollar investments. If built correctly, improved spreads and client stickiness follow; if not, pull back before cash burn accelerates.
Cross‑border connect services (Stock/Bond Connect)
Cross‑border connect services are growing, with northbound flows up mid-single-digits y/y in 2024, but incumbents retain dominant mindshare; strengthening execution, research translation, and streamlined onboarding for offshore clients can close the gap. A credible China corridor and Bond/Stock Connect expertise can attract premium institutional mandates, so a targeted push is warranted.
- flows: mid-single-digit y/y growth 2024
- gap: incumbents dominate mindshare
- focus: execution, research translation, onboarding
- opportunity: unlock premium offshore clients
- action: targeted push on corridor credibility
Fintech partnerships and embedded investing
Big platforms bring users but initial take rates are thin (10–50 bps typical in 2024); integration is costly and political, with upfront build costs often $0.5–2M. If conversion nudges lift activation to 1–3% scale becomes massive; if not, cut fast. Test, learn, decide quickly.
- Take rate: 10–50 bps (2024)
- Integration cost: $0.5–2M upfront
- Target conversion for scale: 1–3%
- Decision rule: iterate fast, exit if conversion < target
Mass‑affluent $35T, OTC $600T — invest advisors+tech; target 1–3%
Founder’s Question Marks: big addressable pools but low share—mass‑affluent AUM $35T (2024), sustainable assets $35.3T (2023), OTC $600T (2024); invest in advisor + tech, rigorous ESG credentials, and risk infra or partner/exit quickly if conversion <1–3%.
| Metric | 2023/24 |
|---|---|
| Mass‑affluent AUM | $35T (2024) |
| Sustainable assets | $35.3T (2023) |
| OTC notional | $600T (2024) |
| Platform take rate | 10–50bps (2024) |
| Integration cost | $0.5–2M |
| Conversion target | 1–3% |