Pete Hess, chief executive of Advent Software, which supplies the asset management industry, has discussed factors affecting the development of new solutions and the growth in Advent's business.
Pete Hess, chief executive of Advent Software, which supplies the asset management industry, has discussed factors affecting the development of new solutions and the growth in Advent’s business.
Which of Advent’s product areas are you currently most excited by?
I would always want to stress the importance of our core portfolio management products Geneva and APX. Thousands of firms globally rely on our products as the core accounting and reporting platform for their asset management business – this is mission critical to these firms, so it is at our heart to continue developing these products to ensure that they are built out to support asset management businesses so that they can be successful and profitable.
The four core tenants in the continued build out are: global coverage, regulatory compliance, expanded instrument coverage, and support for cloud deployment. These core tenants ensure that we continuously focus on bringing new versions to market that allow our clients to run their business very cost efficiently while minimizing the operational risk.
Another product I am really excited about is Advent Direct, our innovative new cloud-based platform. Advent Direct will unlock the full power of our systems by giving our clients access to a powerful set of integrated workflows that will help break the barriers that can handicap adoption and productivity between applications. For our clients, this means everyone in the firm will have direct access to a wide range of investment data and services from any device, including computers, tablets, and smart phones. And for us, Advent Direct will make our products and services easier to adopt, resulting in shorter sales cycles and higher client satisfaction. We are currently working with development partners in Europe and Advent Direct will be available for the wider European market during 2014.
What can you say about Advent’s focus in Europe – either by product or service offerings. How is it different to other regions?
In general, Advent sees the following main factors influencing the asset management industry:
– Increased investor and regulator expectations for risk management and transparency
– Regulatory change and complexity
– Technology paradigm shift to cloud, mobile and social
– Globalization and growth of wealth
These are all important trends that we work with our client base to benefit from by developing our solutions to meet these increased requirements.
Are there any particular regulatory developments affecting the European asset management industry that you are concerned about?
We are not necessarily concerned about any one regulation, but we do realize that firms are facing a very complex regulatory environment not only in Europe, but also globally.
We recently surveyed our European clients and found that approximately 85% support the view that regulation of the financial industry has moved beyond a “reasonable” level to ensure efficient working financial markets. This is a strong message, but nevertheless we obviously have to work with our clients to find efficient ways to handle regulatory requirements. We strive to develop and enhance our solutions in order to assist our clients with building efficient regulatory compliance workflows and appropriate reporting capabilities.
We assist clients in several ways such as core product build out to include added fields and workflow process for Fatca compliance, KYC processes, Mifid II/RDR on client suitability, and calculation of fee management and distribution to client accounts. We are also building out reporting capabilities for local tax reporting, filing schemes to local regulators, and look-through capabilities as part of Ucits and Solvency II.
Additionally, we are addressing regulation through partnerships to implement solutions for specific issues such as Fatca, German tax, Form PF, AIFMD, and others. We see a lot of technology firms and consultancies focusing on providing targeted niche solutions for specific regulatory compliance purposes and where it makes sense for clients we will form strategic partnerships to support efficient regulatory solutions.
One of the biggest drivers behind a lot of technology investments in the financial services industry globally is regulatory compliance and this is especially true across Europe.
What can you say about the strategic targets you have set for Advent, and where you are along the roadmap towards these targets?
We are trying to help our existing clients thrive with improved technology and workflows and adding new clients as well. Both are tracking well.
Do you see any scope for an upturn in technology services provider M&A activity?
While there is still ongoing vendor consolidation in the FinTech and fund administration marketplaces among legacy vendors, the pace of M&A activity doesn’t appear to be picking up, even though the established players continue to generate significant amounts of cash. At Advent, we are currently focused on organic growth. For example, our Advent Direct platform will extend the value and reach of our existing products. However, we would be opportunistic if the right opportunity were to present itself.