Pico Preps Asia Push With 20 New Datacenters

New York-based trading and low-latency data infrastructure technology provider Pico Quantitative Trading plans to bring an additional 20 datacenters online over the next 18 months in locations including China, Australia, South Korea and India.

These new datacenters will complement Pico’s 31 existing datacenters around the world. Roland Hamann, managing director and global head of product at Pico, says the company is looking to replicate its prior achievements in the US and Europe in Asia.

“Those 20 datacenters are pretty much the only datacenters missing in our global footprint to be really fully comprehensive with the global markets. And [included in] those 20 are also some South American, some Middle Eastern datacenters, so we’re really offering a one-stop shop for everything that you can think of in terms of market connectivity,” Hamann says.

When talking with clients in the region, Pico realized that local firms lacked a reliable “one-stop-shop” provider of services such as co-location and trading services, as well as back-office trade processing.

“For example, a tier-one investment bank would prefer having the exact same footprint in many different locations, rather than have slight differences from an operational perspective. It makes life a lot easier,” he says.

Hamann says he believes Equinix’s TY3 datacenter in Tokyo will house a large footprint in the region, driven by the demands of foreign exchange trading, potentially rivaling the size of its deployments in Equinix’s NY4 datacenter in New Jersey—where it manages 11 cages of equipment for itself or clients—or its LD4 datacenter outside London.

Rollouts in other locations—such as Japanese datacenter provider AT Tokyo’s CC1 and CC2 facilities in the Chuo ward of Tokyo—will be driven by other factors, such as equity market access, he adds.

“Hong Kong is also another large growth market for equity players. We are building out [datacenter capabilities] at HKEx [Hong Kong Exchanges and Clearing]. We are already in HK5 [Equinix’s Hong Kong datacenter],” Hamann says.

Pico is also live at the Singapore Exchange’s datacenter and Equinix’s SG1 facility in Singapore, where Pico has its regional headquarters.

Beyond these initial targets, Pico will focus next year on building out locations in more developing markets like the Philippines and Indonesia, and smaller markets in the Middle East that have not garnered the same levels of attention with clients yet.

“We are trying to offer pretty much any co-location globally that has a financial market in it to our clients, and to be able to access that in either a co-location footprint or via PicoNet,” the company’s proprietary network that gives the electronic trading community access to liquidity sources, information providers and counterparties, he says.

However, expanding into Asia is very different process due to the landscape compared to the US—or specifically, compared to Europe.

“Even the rules and regulations are standardized due to Esma. It’s a much more streamlined and easier process to onboard to another venue because you expect the answers that you will be given, whereas in Asia there are subtle differences in what you are allowed to and not allowed to do in a co-location timeline. The service quality you’d expect in, for example, Japan is obviously there but the timeline associated for a simple thing like a cross-connect is stunning,” Hamann says.

In contrast, when a client orders a cross-connect in Europe, it can be set up in two days or less. In Asia, the usual delivery time is four to six weeks, he says, which hinders fast time-to-market or when clients want to branch out in a certain region. 

Hamann relocated from London to Singapore in late 2018 to drive the firm’s regional expansion. He has now grown the team to about 20 in Singapore, including the hires of former FIS and Newedge tech exec Nicolas Friceau as global head of datacenter engineering, former Colt sales exec Jasmyne Tung as Asia-Pacific regional head of sales, and former BT and Credit Suisse exec Elton Pang as regional head of service operations. In addition, Pico has two employees in Tokyo, and will add headcount in Hong Kong soon.