TRENTON, NJ—Bridgewater-based BackEnd Benchmarking, which evaluates performance of investment firms in the “robo-advisor” space, is quickly becoming a global leader in investment analytics and transparency. Helping the company grow are angel investor tax credits offered by the New Jersey Economic Development Authority.
The company remains grounded in its local community, nurturing the next generation of entrepreneurs by hiring New Jersey-educated employees, and benefiting from resources available to the Garden State's technology community.
BackEnd Benchmarking's president and founder, Ken Schapiro, created the company to provide a research tool to help investors make informed decisions when considering investing in a robo-advisor. To that end, he pumped close to $500,000 of his own dollars into investments handled by several of the largest robo-advising products, including offerings from TD Ameritrade, Charles Schwab Corporation, Fidelity, Betterment, and others. This enabled his company to use its proprietary software platform to aggregate data and analyze various aspects of the investments, such as equity positions and fixed income. BackEnd Benchmarking tracks these investments and publishes The Robo Report, which monitors the largest and most well-known robo-advisors, with the goal of providing transparency via quarterly analysis of robo-advisor performance, portfolios and news.
In 2017, BackEnd Benchmarking received $470,000 in funding from investors who participated in the State's Angel Investor Tax Credit Program. Administered by the New Jersey Economic Development Authority and the New Jersey Division of Taxation, the program offers a 10-percent refundable tax credit against New Jersey corporation business or gross income tax for qualified investments in an emerging technology business with a physical presence in New Jersey and that conducts research, manufacturing, or technology commercialization in the state.
The EDA approved 256 Angel Investor Tax Credit applications in 2017, representing the injection of a total of $111 million of private capital into 39 different technology and life sciences companies throughout the Garden State. Since the program began in 2013, the EDA has approved 929 applications for investments in 65 New Jersey-based technology businesses totaling more than $332 million.
“The Angel Investor Tax Credit Program is a great extra incentive to invest in our company,” Schapiro said. “Of course, there are a lot of other criteria on which our investors base their decisions on where to deploy capital, but when they look for funding, every extra incentive helps. Also, when considering the best use of raised capital, I would rather rent affordable office space and hire more software developers than pay astronomical rents in a place like New York City and have a less robust team. This affordability also benefits employees, who can focus more on building a great product if they are not under the stress of high living costs or long commutes. Schools like Rutgers and Stevens Institute of Technology also have robust programs that are educating young people with the skills I need to build out our businesses. Proximity to New York City, access to young talent, and affordability are just a few reasons New Jersey makes a lot of sense for us.”
Schapiro added that, for investors that are local to New Jersey, the program helps emphasize that they are investing in their community and helping to create jobs and a robust economy where they live.
Schapiro is also president of Condor Capital Wealth Management, an investment advisor from which BackEnd Benchmarking spun out in 2016. Its offices are in a former school renovated by Schapiro. Both Condor Capital Wealth Management and BackEnd Benchmarking are committed to fostering entrepreneurship in the state and routinely offer internships and full-time employment to Rutgers University students and graduates.
“The State's proximity and accessibility to New York City's financial markets and its highly-educated workforce make New Jersey an ideal location for financial technology companies,” says EDA chief executive officer Tim Sullivan. “The Angel Investor Tax Credit Program and other resources are helping early-stage companies like BackEnd Benchmarking flourish in the Garden State.”
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Steve Lubetkin
Steve Lubetkin is the New Jersey and Philadelphia editor for GlobeSt.com. He is currently filling in covering Chicago and Midwest markets until a new permanent editor is named. He previously filled in covering Atlanta. Steve’s journalism background includes print and broadcast reporting for NJ news organizations. His audio and video work for GlobeSt.com has been honored by the Garden State Journalists Association, and he has also been recognized for video by the New Jersey Chapter of the Society of Professional Journalists. He has produced audio podcasts on CRE topics for the NAR Commercial Division and the CCIM Institute. Steve has also served (from August 2017 to March 2018) as national broadcast news correspondent for CEOReport.com, a news website focused on practical advice for senior executives in small- and medium-sized companies. Steve also reports on-camera and covers conferences for NJSpotlight.com, a public policy news coverage website focused on New Jersey government and industry; and for clients of StateBroadcastNews.com, a division of The Lubetkin Media Companies LLC. Steve has been the computer columnist for the Jewish Community Voice of Southern New Jersey, since 1996. Steve is co-author, with Toronto-based podcasting pioneer Donna Papacosta, of the book, The Business of Podcasting: How to Take Your Podcasting Passion from the Personal to the Professional. You can email Steve at [email protected].
