A former single mother and options trader, Jenny Just runs a multibillion-dollar business that provides the trading and technology behind popular mobile trading platforms, robo advisors and online banks.
“It should be a movie,” serial entrepreneur and investor Jenny Just says of the biggest deal of her career. The former options trader, who has started or bought 15 businesses in the past 24 years, is gearing up for her first IPO, after turning a nearly bankrupt clearing firm into a fintech heavyweight that supplies securities and crypto custody and trading technology to dozens of better-known upstarts.
Fintechs, which were already disrupting traditional financial institutions when the pandemic hit, have seen their growth accelerate during the Covid era. From SPAC IPOs to big venture capital rounds, valuations of popular startups like mobile stock trader eToro, robo advisor Betterment, personal finance firm SoFi and online bank Ally Financial have soared under a hot tech market.
The one thing all these firms have in common: Their back-end trading is handled by Apex Fintech Solutions, which is planning to ride their coattails to its own successful public debut. The firm, owned by Just and husband Matt Hulsizer through their Chicago-based investment firm, Peak6, announced in February that it planned to list on the New York Stock Exchange via a SPAC merger expected to value the company at $4.7 billion.
While Peak6 still hopes to close this year, the Securities and Exchange Commission has yet to approve the deal, and the market for SPACs has cooled considerably. The SEC declined to comment on the delay. Even if it goes through at half its announced value, the deal (plus other assets) catapults both Just and Hulsizer into the billionaire ranks—and puts Just into the rarefied club of just 23 American women who are self-made billionaires.
No matter what happens, it’s been an incredible run for Apex. Since acquiring the company in 2012, Just has reinvented it as a “fintech for fintechs,” powering the trading and technology for over 200 clients, from digital trading platform Webull to Marcus, Goldman Sachs’ online consumer banking and investing arm. (When Robinhood was getting started, it also used Apex, but eventually built its own platform.)
The Apex acquisition started with an ominous Friday call. In May 2012, Just got a call from the CEO of Penson Worldwide, which owned the clearing and custody firm that Peak6’s options trading platform, OptionsHouse, used to settle its trades and hold its investors’ assets for safekeeping. Penson was short on cash. “When your bank calls and says, ‘I need to borrow some money,’ it’s got to be a problem,” recalls Just. She said no to the lending request, but by the following Monday, the Securities and Exchange Commission was on the other end of the phone. The message: Either someone bails it out by the end of the week, or Penson’s clearing firm is going belly-up.
If Penson had shut down, it could’ve taken down OptionsHouse with it. It also would have hit Peak6’s hedge fund, which had invested in its convertible notes. With no one else willing to rescue the business, Peak6 paid $60 million for the assets of Penson’s clearing firm under a newly formed corporation, Apex Clearing. She wasn’t happy about the rushed deal—it was inked in two weeks—but “it was the lesser evil for everybody,” remembers Just.
Jenny Just by Guerin Blask for Forbes
When Just took over Apex, her focus was remaking its operations so that it could better serve OptionsHouse. Penson ran the business like an “old boys’ club,” says Just, where the firm made backroom deals with some customers that gave them preferential treatment. Shortly after the acquisition, Just flew to Penson’s headquarters in Dallas with her team and got down to business, shedding two thirds of the firm’s original customers and half of its employees within a year.
Apex’s first project was improving the technology behind opening accounts to make it easier for new customers to join OptionsHouse, a process that used to take days and required physical paperwork. “Frankly, when we first started it, it was about keeping ourselves alive,” Just says of her deal to acquire Apex. “We picked our heads up a couple years later, and it turns out a lot of other people needed that technology, too.”
By 2015, a slew of fintech firms began using Apex as they launched their online platforms, including Robinhood, Wealthfront, Betterment and Stash. Apex also expanded into powering digital wealth management, and then added cryptocurrency trading by launching Apex Crypto in 2018. The company, which managed a million customer accounts when it was acquired by Peak6, now handles 17 million, including 1.6 million crypto trading accounts. Its custody service, which holds its clients assets’ for safekeeping, manages over $100 billion in assets.
Meanwhile, Peak6 still operates its flagship options trading business, though Just would not disclose any financials, and it owns majority stakes in insurance company National Flood Services and e-sports franchise Evil Geniuses, which was recently valued at $255 million after a minority investment by Shanghai-based Fosun Group.
Just cut her teeth as an options trader at Chicago-based O’Connor & Associates; her first introduction to the Chicago Board of Trade came on the same day that famed investment bank Drexel Burnham Lambert (where Mike Milken made his name with junk bonds) filed for bankruptcy in February 1990. “They took me down to the [trading] floor . . . sat me down on a step and left me there the whole day,” remembers Just. There weren’t any women’s restrooms nearby (“It’s all men at the time,” she says), so the Wisconsin native skipped bathroom trips and lunch as she waited around all day.
As the only girl in a family of five kids, being a female trader among a sea of male traders didn’t faze Just. “I grew up with four brothers,” explains Just, “so it’s not a radical surprise that I had chosen to be in a male-dominated field. I probably would have, frankly, failed in a totally female-dominated industry. I wouldn’t have competed like I have—this is what I knew. This is my comfort zone,” she explains.
The University of Michigan graduate rose quickly at O’Connor. By her mid-20s, she was tasked with building an over-the-counter options trading business with her colleague, Matt Hulsizer, after O’Connor was acquired by Swiss Bank (which later merged with UBS). When Swiss Bank decided to take the growing business to Connecticut, Just and Hulsizer quit their jobs to stay in Chicago and start their own firm. Then a single mom to a 1-year-old, Just needed a business that could immediately provide income, so she and Hulsizer went into options trading. The duo founded Peak6 Capital Management, a proprietary options trading firm, in 1997, with $1.5 million in seed capital from partners at O’Connor, friends and family. It wasn’t common to have a female partner then, says Just, but the longtime colleagues chose to be a team. Their relationship eventually turned romantic; Hulsizer, who is an equal partner at Peak6, and Just married in 2003.
Peak 6 Capital Management became an early success. “We got a little bit lucky in trading . . . and that gave us the opportunity to reinvest in ourselves,” says Just. Some of its investments—a chicken-cleaning business, a ferris wheel, an oilfield—did not take off. Others fared better. They funneled some of the trading profits into a hedge fund, building it into a nearly $3 billion (assets) firm before selling it in 2014.
As fintechs mature, Apex faces new challenges. The firm provides personalized (back-office) services to smaller startups, but once those startups get big, they sometimes opt to bring more operations in-house to cut costs, says Kevin Heal, senior analyst at Argus Research. “Apex is really focused on smaller companies, up-and-coming companies. . . . Do the companies [eventually] get big enough to ‘graduate’?”, asks Heal, who pointed to Robinhood, which broke ties with Apex in 2018 to start clearing its own trades. So far, out of its 200-plus customers, only Robinhood and robo advisor Wealthfront have dropped Apex, it says.
Areas where Apex has stood out—such as providing custodial services for cryptocurrencies—will see increasing competition in future years, and the proliferation of zero-commission trading forces firms to take a hard look at all their costs. Apex is profitable, reeling in $36 million in net income on $146 million of revenue in the first quarter of 2021, compared to $7 million in net income on $73 million of revenue from the first quarter a year ago, but its $4.7 billion valuation is predicated on its ability to keep up the growth. “It just seems like a very, very high valuation on a company that’s in a shrinking margin business and highly competitive [industry],” says Heal.
Just is confident that Apex can maintain its edge as a fintech solutions provider. “We’re almost, like, outsource tech; I can be there and help you do the next thing we want to do, ASAP,” says Just. She pointed to Robinhood’s fiasco in January, when the firm had to limit trading of certain meme stocks (like GameStop) because of the large volume of buying and volatility of the market. Robinhood admitted that its in-house clearing brokerage, Robinhood Securities, could not meet the deposit requirements of its clearinghouse had it allowed the meme stock trades to go on unabated.
“Robinhood is a brilliant designer, but when they decided to take on something in clearing, it’s not just about the tech. It’s about how the industry works. It’s about the regulatory bodies, it’s about the financial capital requirements,” says Just, who credits her history in options trading for her comfort in working in highly regulated industries.
As the head of a tech and finance firm, Just is keenly aware of the gender imbalance that exists in the workplace, but even she initially struggled to get more women into the firm. In 2016, she started an intern program called the “Trading Experience for Women” at Peak6 Capital Management. The options trading firm began with 7 women in the program, and has trained 40 women since its inception. The focus is preparing women to be comfortable with risk and capital allocation, regardless of whether they choose to stay with Peak6 or even in trading as a career.
“I think it’s critical that women make decisions around money,” says Just. “If you can make decisions around money in an option product . . . you can make decisions around money in any industry alongside any C-level position.” Peak6 also added a software engineering internship for women in 2018 and a product internship for women this year. Today nearly 35% of the traders at Peak6 Capital Management are female.
It’s not just in the office that Just is trying to make an impact. In June 2020, she decided to launch Poker Power, which aims to teach a million women to play Texas Hold’em. She initially got the idea from her husband, who returned from a tennis match with their daughter lamenting that while she was very good at tennis, she needed to get better at strategizing; he suggested that she might want to learn poker. Just got her daughter poker lessons and took it up herself. Soon she was teaching her friends and eventually other young women. “A hundred million-plus people in the world play poker; some single-digit [percentagewise] are women,” says Just, who thinks the program is a good tool to reach younger women and high school girls and provide them a chance to participate in a traditionally male game.
“It’s really about teaching capital allocation, strategy, risk and giving women the practice and the time to build confidence at the table, because the poker table is like the boardroom table.” So far, more than 3,000 girls and women have gone through the program—which offers free community lessons or $55-an-hour private lessons. The organization aims to surpass 10,000 students in 20 countries by the end of 2021.
“It’s part of the reason I’m speaking, when historically I haven’t opened up much,” Just says of her decision to share her story with Forbes. “I can’t have a female-led firm and not solve this.”
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(Net worths are as of October 14, 2021)
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Kim Kardashian by Jamel Toppin for Forbes
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