Investors have flocked to foreign exchange trading over the past 10 years, and the venture capital community is ready to grab a piece of the action.
Two companies -- Currensee Inc. and Tradonomi LLC -- are angling for central spots in this emerging trading community, and several funds are placing pretty big bets on their success. Currensee has a social network for forex traders, while Tradonomi's move was to create a game-like user interface to make it easier for would-be fortune-makers and thrill-seekers to trade foreign currencies.
The particular attraction of sites like Currensee and Tradonomi, not to mention the forex market in general, is that unemployment has put more people at home than usual. They don't have jobs, and they want to make some money. Or, they have jobs and want to bolster their holdings. Whatever the motivation, traders have access to a 24-hour market place that comes with a lot of flexibility.
The VC folks see the value in offering laymen a chance to play in the forex space at any hour of the day or night. North Bridge, for example, led a $4 million A round of financing a year ago in Currensee, which is currently in beta testing and doesn't actually execute trades. The social networking platform does provide visibility into markets and other traders (assuming permission is given), which can inform trading strategies and make forex investors (theoretically, at least) more successful.
Tradonomi raised $6.3 million from BRM Group and Cubit Investments in its second round of financing last spring. The company offers a forex simulation platform to help prospective traders learn the ropes. As they traders improve, they advance to more complex trading environments.
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