Point72 Invest in Crowd-Sourced Quantopian

Andreessen Horowitz and Steve Cohen’s Point72 Ventures are among investors in a $25 million funding round for Quantopian, the five-year-old online platform where coders build and run computerized trading programs, according to Bloomberg. The Boston-based firm plans to use the money to enhance its platform, adding portfolio optimization tools and providing more data for algorithms written by its 100,000 or so members.

Quantopian is also using the funding to beef up its investment management infrastructure in preparation for plans to start managing outside capital by early 2017. It’s another vote of confidence for the crowd-sourced quant model, in which programs written by anyone, professionals, academics, amateurs, do Darwinian battle with one another in a quest for prestige and, increasingly, money. The latest financing round is separate from $250 million earmarked by Cohen’s venture capital unit to be managed by the site.

Quantopian provides its users with tools and software to write automated trading strategies. For more than a year, Quantopian has held programming contests, trading venture-backed capital on the winning strategies and sharing those profits with the algorithms’ writers. As a part of the push to operate more like a traditional hedge fund, albeit using crowd-sourced algorithms, Quantopian hired Jonathan Larkin, a former portfolio manager at Hudson Bay Capital, as its chief investment officer in June. The funding round also had contributions from Khosla Ventures, Bessemer Venture Partners and Spark Capital.