Zanbato raised $20.5M in a Series C round in February 2021, with J.P. Morgan participating as a strategic investor. The company has secured approximately $37.6M in total funding across five rounds since 2010.

Earlier funding rounds include an $8M Series B in 2015, led by AITV with additional participation from Formation 8. Other investors include Accelerate-IT Ventures and 8VC, providing Zanbato with financial and strategic backing from both venture capital firms and financial institutions.

Zanbato operates a marketplace platform that facilitates institutional investors in trading private company stocks through registered broker-dealers via its SEC-registered alternative trading system, ZX ATS.

The platform connects over 100 broker-dealer trading desks, enabling them to post buy and sell orders for pre-IPO and late-stage private company shares.

Institutional investors trading private company stock work through their existing broker-dealers, who use Zanbato's ZX platform to identify counterparties and execute trades.

The system manages private market complexities, including eligibility verification, compliance checks, and settlement coordination, which are more intricate than public market transactions.

In addition to trade execution, Zanbato offers data products through ZXData, which delivers pricing benchmarks, trading volume analytics, and market intelligence based on over $17 billion in closed transaction data.

This dual role as a trading venue and information provider supports the private markets ecosystem.

The platform has also partnered with NYSE OPEN to develop reference data feeds for private market indexes, leveraging Zanbato's transaction data to create market intelligence products tailored for institutional use.

Zanbato operates as a B2B marketplace connecting institutional investors through their broker-dealers to trade private company stocks.

The company generates revenue through transaction fees charged on trades executed via their SEC-registered ATS, adding a markup to the cost of facilitating these private market transactions.

The business model relies on network effects, where an increase in broker-dealers on the platform enhances liquidity pools, attracting more institutional participants.

This dynamic drives higher trading volumes, which in turn increases transaction fee revenue and generates richer data sets that can be monetized through their ZXData analytics products.

The platform addresses liquidity and transparency challenges that have historically made private stock trading inefficient. By offering standardized workflows, compliance automation, and price discovery mechanisms, Zanbato reduces friction for institutional market participants and captures value from these efficiencies.

Unlike traditional financial exchanges that charge listing fees or market data subscriptions, Zanbato's model is primarily transaction-based, aligning their revenue with actual trading activity rather than platform access.

Nasdaq Private Market is Zanbato's most direct institutional competitor, having relaunched its SecondMarket platform in September 2024 with a 1% flat commission pricing model. NPM benefits from backing by nine global banks, which provides distribution into bulge-bracket broker-dealers and settlement infrastructure through its Tape D data feed system.

Forge Global operates as a publicly traded competitor, combining marketplace functionality with data subscription services through Forge Intelligence.

In 2024, Forge experienced an 18% volume decline due to tech valuation resets but is expanding into Institutional Liquidity Programmes by partnering with JPMorgan and Citadel Securities to develop market-making capabilities.

InvestX competes with Zanbato's institutional focus through its ATS, which connects private stock inventory to bank broker-desks via FIX protocols.

The platform targets mid-market blocks between $5 million and $50 million, offering T+3 settlement through escrow partner Cleartrust. Its low-touch API model competes directly with Zanbato's ZX-Protocol infrastructure.

Competition is intensifying around data and price discovery capabilities, as platforms aim to develop valuation APIs, real-time cap table integrations, and institutional-grade analytics that can support premium pricing beyond basic transaction fees.

Zanbato's collaboration with NYSE OPEN to develop the Unicorn Index reflects their ability to monetize transaction data beyond trading fees.

The company has opportunities to expand into valuation benchmarking services, scenario modeling tools, and compliance analytics, targeting institutional spending currently allocated to boutique data vendors.

As institutional LPs increasingly require more rigorous mark-to-market practices, Zanbato's $17B+ closed-trade dataset enables the development of advanced analytics modules that integrate with their core trading infrastructure.

These modules could generate recurring revenue streams that complement their transaction-based model.

The potential for data-driven services extends to fund administrators, wealth managers, and corporate development teams seeking private market intelligence for portfolio management, due diligence, and strategic planning.

In addition to the 100+ broker-dealer trading desks already using their platform, Zanbato could expand its customer base to include pension funds, endowments, and sovereign wealth funds that are increasingly active in direct secondary transactions.

White-label ZXConnect solutions could allow large allocators to post indications of interest directly while ensuring regulatory compliance through their executing brokers.

The wealth management channel presents growth potential as index products and structured access vehicles reduce ticket sizes and compliance barriers for private banks and RIA networks seeking late-stage VC exposure for their clients.

Company-led liquidity programs represent another avenue for customer growth. Zanbato could manage structured tender offers or continuous trading windows for private companies aiming to provide employee liquidity without disrupting their inter-dealer routing model.

European growth through multilateral trading facility registration could address cross-venue liquidity needs for EU brokers navigating post-MiFID II market fragmentation. In Asia Pacific, regional inventory opportunities could emerge through partnerships with local prime brokers, particularly around portfolios tied to SoftBank Vision Fund and Temasek.

Partnerships or acquisitions in digital ledger technology could also streamline private share settlement cycles, reducing the current T+10 timeline and associated operational inefficiencies.

The private credit and alternative investment markets offer additional adjacency opportunities. Zanbato's institutional relationships and trading infrastructure could support secondary transactions in private debt, real estate, and other illiquid asset classes.

Regulatory changes: Private market trading operates within a complex regulatory framework. Changes to SEC rules regarding ATS reporting, accredited investor definitions, or private company disclosure requirements could materially affect Zanbato's business model. Higher regulatory compliance costs or new restrictions on institutional access to private markets may reduce trading volumes and diminish platform utility.

Market concentration: Zanbato's revenue relies heavily on institutional demand for private company stock trading, which is subject to cyclical trends and sector concentration, particularly in technology. Economic downturns, declines in venture capital activity, or shifts in institutional allocation strategies away from private markets could significantly reduce transaction volumes and associated fee revenue.

Platform disintermediation: As private markets evolve, large institutional players such as J.P. Morgan or Goldman Sachs may develop in-house capabilities or acquire competing platforms to capture a greater share of the private trading value chain. Similarly, major private companies could establish proprietary trading venues or form exclusive partnerships with single platforms, potentially diverting liquidity from multi-dealer marketplaces like Zanbato.