Citi-led banks back Capitolis at $1.9 billion as it buys its way into securities lending
Capitolis raised $220 million, including a $120 million Series E led by Citi at a $1.9 billion valuation, with eight other big institutions joining. Most of the money backs its purchase of eSecLending, putting securities lending inside the capital and balance-sheet software Capitolis sells to banks.
The Investor · Invest desk
What happened
- Bank of America, Nomura and Tradeweb Markets came in as new strategic investors, and Barclays, BNP Paribas, J.P. Morgan, State Street and UBS returned from earlier rounds.
- Debt from First Citizens Innovation Banking, formerly Silicon Valley Bank, Hercules Capital and Pinegrove Venture Partners makes up the rest of the package.
- Capitolis says the eSecLending deal also widens its access to a network of institutional asset owners.
- The new valuation compares with $1.6 billion at Capitolis's previous funding round in 2022.
Why it matters
- Who's exposed exposure Nearly half the package is debt, so any delay in eSecLending's revenue falls on Capitolis's cash and its lenders before it reaches shareholders.
- What it costs cost Holders from Capitolis's 2022 round have earned about 4.4% a year on paper, a thin return for any investor without a strategic reason to own the company.
- Who's exposed exposure Asset owners in eSecLending's network now work with a vendor directly owned in part by several of the world's largest financial institutions.
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The banks on Capitolis's register are paying for eSecLending, or rather for part of the package that pays for it [5]. Take the $120 million of equity out of the $220 million total and $100 million is left, so about 45% of the money is borrowed [13][14]. The banks' own share of the equity is below $120 million, because unnamed new and existing financial investors also bought into the Series E [3].
Gil Mandelzis, the founder and chief executive, said the mix was deliberate [11]. "Debt is much cheaper for the company. We will soon start generating significant cash flow, and I prefer debt over equity," he told Calcalist [12]. The share price gives him a reason. At $1.9 billion, Capitolis is worth 19% more than at its 2022 round, roughly four years earlier [15]. If $1.9 billion is the post-money figure, the $120 million bought about 6.3% of the company [19]. Capitolis did not disclose what it is paying for eSecLending.
Borrowing makes the timing of eSecLending's revenue matter. Mandelzis said the acquisition "is set to generate tens of millions of dollars in revenue as early as the coming year" [18]. If that arrives, cash flow carries the debt and the shareholders own a larger platform bought at a price only 19% above 2022's [15]. If it arrives a year late, Capitolis is more likely to come back for equity before the acquisition has proved itself, at whatever price the market sets then.
I think the banks are buying the platform more than the stock. Mandelzis framed the round the same way. "I believe in strategic investment, like the kind we just secured," he said [12]. Nine named institutions sharing a stake of about 6.3% with other investors own, on average, less than 0.7% each [17][19][20]. The counter-thesis is that the strategic investors expect eSecLending to reprice Capitolis at its next round. If that round lands well above $1.9 billion on the new revenue, the banks were financial investors first and strategic ones second, and this view is wrong.
What to watch
- A disclosed price for eSecLending, so the revenue forecast for the coming year can be set against what Capitolis paid.
- Terms on the roughly $100 million of debt from First Citizens, Hercules and Pinegrove, chiefly the rate and maturity.
Information, not investment advice. This story is general information about companies and markets, drawn from cited reporting. It is not a recommendation to buy, sell or hold any security; check the cited sources before acting.
Clarity's read
What the record supports and how the coverage leans. The claims behind it follow.
Reality
- Evidence50
- Adoption
- Not scored
- Hype gap+10
- Incentives65
- Confidence60
Claim ledger
Ranked by verification strength, evidence, and original report placement.
- [1]
Capitolis completed a $120 million Series E equity round at a $1.9 billion valuation; the total financing package reached $220 million, combining equity and debt.
- [2]
The Series E was led by existing investor Citi, with participation from new strategic investors Bank of America, Nomura and Tradeweb Markets.
- [3]
Existing investors Barclays, BNP Paribas, J.P. Morgan, State Street and UBS also participated, alongside additional new and existing financial investors.
- [4]
Debt financing is provided by First Citizens Innovation Banking, formerly Silicon Valley Bank, Hercules Capital and Pinegrove Venture Partners.
- [5]
The newly raised capital will be primarily used to support Capitolis's acquisition of eSecLending.
- [6]
Capitolis was valued at $1.6 billion in its previous funding round in 2022.
- [7]
The new financing brings several of the world's largest financial institutions directly into Capitolis' shareholder base.
- [8]
The eSecLending acquisition is intended to integrate securities lending into the Capitolis financial resource optimization platform and expand access to a broader network of institutional asset owners.
- [9]
The funding date of the Series E is October 6, 2026.
- [10]
Capitolis builds software for its Capital Marketplace and Portfolio Optimization businesses, helping major banks and financial institutions with funding, capital and balance sheet management.
- [11]
Gil Mandelzis, Capitolis's founder and CEO, said the company deliberately chose a combination of equity and debt.
- [12]
"Debt is much cheaper for the company. We will soon start generating significant cash flow, and I prefer debt over equity. I believe in strategic investment, like the kind we just secured."
- [13]
The debt portion of the package is about $100 million.
- [14]
Debt is about 45% of the $220 million package.
- [15]
The $1.9 billion valuation is about 19% above the $1.6 billion 2022 valuation.
- [16]
The valuation gain compounds to about 4.4% a year over roughly four years from 2022 to October 2026.
- [17]
Nine institutions are named as Series E investors: Citi as lead, three new strategic investors and five returning investors.
- [18]
"Most of the funds are allocated to our recent acquisition, which is set to generate tens of millions of dollars in revenue as early as the coming year."
- [19]
If $1.9 billion is post-money, the $120 million Series E bought about 6.3% of Capitolis.
- [20]
The nine named institutions own on average less than 0.7% each from this round, since other investors share the roughly 6.3% stake.
Sources
2 independent publishers whose own reporting we read for this story.
- calcalistech.comCapitolis, which develops tech for banks and financial institutions, raised $220M, including a $120M Series E at a $1.9B valuation, up from $1.6B in 2022
1 article · October 6, 2026
- thesaasnews.comCapitolis Raises $120M Series E
1 article · October 7, 2026
Topics and entities
Topics
- Fintech Funding
- Securities Lending
- Bank balance-sheet optimization
Entities
- Citi
- Nomura
- Hercules Capital
- Pinegrove Venture Partners
- J.P. Morgan
- Tradeweb Markets
- State Street
- Bank of America
- UBS
- First Citizens Innovation Banking
- Barclays Plc
- BNP Paribas