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Interviews &
By Mike nicholas, bda
Q&A with
John DesPrez III, CEO, InspereX
InspereX: Transforming how fixed income securities and market-linked products are accessed, evaluated, and traded
A Q&A and profile featuring John DesPrez III, CEO of InspereX, hosted by Mike Nicholas, CEO of the Bond Dealers of America

Mike Nicholas, BDA:

Tell us about your merger of Incapital and 280 CapMarkets to create InspereX.

John DesPrez III, InspereX:

Think of it this way: What do you get when you take one of the industry’s leading, most experienced fixed income and market-linked product distributors, and combine it with a visionary fintech focused on creating a vastly more productive and profitable experience for participants across the fixed income marketplace?
You get the powerful benefits that deep market knowledge combined with ultra-cutting-edge technology unleash. You get a new tech platform that completely transforms the fixed income market experience by giving participants deeper insights, greater access and price transparency, and much more control.
What you get is InspereX.
That was our vision when we merged Incapital and our decades of institutional expertise with 280 CapMarkets, the Silicon Valley-based creators of the pioneering, fixed income market aggregation technology, BondNav.


How do you see the bond market structure evolving? How is tech playing a role?


Market structure, the regulatory environment, and technology are all evolving simultaneously – and rapidly. The demand for greater access and price transparency is increasing alongside heightened regulatory scrutiny on best execution and record keeping – all putting technology front and center. Overwhelmed by choice and burdened by regulatory-driven documentation requirements, wealth managers, registered investment advisors, broker-dealers, and institutional investors are all desperate for intuitive technology that can be customized to fit seamlessly into their workflows and that lets them cut to the trade, as we like to say.

InspereX, with our BondNav platform, has a clear advantage in today’s evolving markets and regulatory environment. As a solution, BondNav not only gives participants greater control over their fixed income market experience through customization, it also provides tools to help manage regulatory and compliance obligations, so they can conduct business with greater peace of mind.

But technology is only one part of our story – it’s also important to note the role played by our deeply experienced and knowledgeable fixed income trading professionals across asset classes. Our core team has decades of combined expertise and is a critical component giving our clients the distinct advantage of choice – they can use BondNav to access offerings and bid wanteds and quickly and easily execute their objectives; they can receive assistance from our expert team; or they can use a combination of both.


Talk a little about InspereX’s BondNav platform and the relationship with Goldman Sachs Advisor Solutions.


Success in the capital markets today requires speed, depth of access, transparency, best execution, and insights gained from the aggregation of market data that only technology can deliver.

The BondNav platform aggregates real-time pricing and RFQs directly from multiple ATS & ECN platforms, institutions, registered investment advisors, banks, and broker/dealers. We have worked hard to develop exceptional relationships across the marketplace of retail, middle market, and institutional bond buyers and sellers. It’s a market that sees an average of $960 billion traded every day. Our job is to give our clients greater control over their fixed income market experience, while making selecting and buying securities faster, easier, and potentially cheaper across almost all fixed income asset classes. These benefits resonate with market participants, and we are continuously adding new BondNav users.

Our vision for the future was validated late last year with the launch of a white-labeled version of BondNav for Goldman Sachs Advisor Solutions. Goldman could have chosen any market technology in the world to serve their growing RIA business; they chose ours. Significantly, their choice of BondNav was accompanied by an additional equity investment in InspereX. We are proud to have them as one of our partners.


What’s concerning to you right now?


Market conditions are especially challenging this year given the rising interest rate environment. Higher rates will be beneficial to our business; however, the journey of getting to those rates can be difficult. It is times like these that underscore the importance of our business model diversified across asset classes. With this approach, we are able to offer our clients more ideas to help satisfy their objectives in the face of so much uncertainty. Additionally, like all broker-dealers, we continue to keep a sharp eye on the ever-changing, always-challenging regulatory environment and place special emphasis on our documentation processes in both our traditional and tech-enabled businesses to help our customers overcome regulatory burdens.


Where else are you seeing opportunity in the marketplace?


Our core securities businesses continue to thrive as institutional clients seek opportunities across the market, especially in the face of heightened volatility and uncertainty. In 2021, we maintained our status as a top underwriter of U.S. Agency securities, finishing #12 on Bloomberg’s League Tables. Our flagship proprietary product InterNotes, which is corporate debt designed for individual investors, posted a 22% sales increase over the prior year.

Further, we’ve seen a significant uptake in ESG. Our clients like that the social impact of individual bonds can be easily assessed by looking at use of proceeds. Impact measurement is an important topic in ESG, and one that we think our issuers are well positioned to respond to. Our impact investment issuers include Community Development Financial Institutions, which are at the heart of efforts to address community problems across America, as well as the supranationals: IFC and The World Bank. InspereX is the leader in CDFI debt underwriting, ranking #1 with $345 million in Bloomberg League Table credit.

Our other core business is market-linked products (MLPs). We are one of the nation’s leading distributors of MLPs, also known as structured products. We maintain numerous exclusive distribution relationships, and work with all the leading issuers of MLPs. We continue to achieve record sales results as more advisors recognize the significant benefits that MLPs can provide to their clients – especially as protection against market volatility.

You might ask what MLPs and traditional bonds have in common. It’s all about how advisors use them to elevate the value they bring to their clients.

Advisors who prefer individual bonds instead of, or along with, packaged products, do so because they believe their clients can benefit from a more tailored solution to their challenges. Similarly, advisors who introduce MLPs to their clients do so because they realize the power of the product and how it can deliver a more defined-outcome solution along with risk management. In both cases, utilizing these investments demonstrates an advanced understanding of their client’s challenges and helps advisors stand out from the competition as they seek to deliver greater value to their clients every day.

At InspereX, with BondNav as well as with our MLP and traditional bond businesses, we believe strongly that our mission is to give market participants more control over their experience and more help achieving their objectives.