Two London-based RegTech startups are joining forces. CUBE , an automated "regulatory management" company, is acquiring The Hub, whose AI allows regtech clients to scrutinise unstructured text data from thousands of online regulatory sources.
CUBE mainly focuses on strengthening an enterprise's capacity to respond to regulatory reforms. Its compliance tools help predict enterprise risks likely to arise from new laws and ways to limit the cost burden of complying.
The company wants to tie up multiple acquisitions to help expand its offer. In the case of The Hub, the IP turned out to be attractive because of an overlap monitoring online regulatory sources and also the strength of its team, which CUBE founder and CEO Ben Richmond says are "best-in-class".
The Hub's platform has catalogued web content more than 3,500 regulatory organisations, in finance, pharmaceuticals, ESG, anti-money laundering and cybersecurity.
Text data from the regulators is fed to The Hub's AI to identify passages relevant to the client while ensuring publications are up to date with the latest regulations.
CUBE now proposes to integrate The Hub's tech stack and bring on the latter's team to fuel the next stage of its growth strategy. The company specialises in an offshoot of RegTech known as "complex regulatory change management".
This mainly relates to wholesale regulatory changes in specific industries - consider the heavy fines for GDPR infringements, or forthcoming laws that will affect MedTech and digital assets, each posing big challenges for businesses operating in those sectors.
The CUBE platform also uses AI, mainly to provide snapshots of new legal rules and the likely impact for the client's internal policies.
Ben Richmond, CEO of CUBE, added: "The acquisition of The Hub marks the first in what is expected to be a number of purposeful acquisitions for CUBE as a consolidator of regulatory compliance focused firms and technologies in what is a highly fragmented RegTech market.
"The Hub’s team and solutions are best in class and represent many synergies with CUBE’s own capabilities.”
Juned Jable, CEO and co-founder of The Hub, added: "We are excited by this next phase in our journey.
"We have partnered with CUBE for some time and see this as a natural next step in more closely aligning both firms AI-driven regulatory technology.
"CUBE’s strategy will ensure Hub’s employees, customers and partners are in safe hands and will benefit from further investment from what is clearly now the undisputed market leader.”