Alveo has set out its next stage strategy with a focus on two key themes – accelerating client migration of market data to cloud, and building out its self-service data provision for business users. Also on the agenda are ESG data management, industry partnerships, and development of AI tools.
To find out more about the strategy, which follows a majority investment in the company by Symphony Technology Group (STG), we caught up with Alveo CEO Mark Hepsworth. Hepsworth was instrumental in the MBO of Alveo (then Asset Control) backed by Sovereign Capital Partners in September 2018, and most recently the STG investment. Commenting on the change of ownership, he says: “We have had a good four years with Sovereign, which supported expansion into managed services, product innovation, and moving Alveo natively to the cloud. STG has a different profile as an investor. It is very large and has deep domain knowledge in financial services data, software and analytics that will be helpful for Alveo.”
Moving market data to the cloud
Having made its platform cloud native, Alveo is seeing not only growing interest in moving market and reference data to cloud, but also new opportunities as cloud data warehouse systems such as Snowflake and Amazon Redshift encourage the move to cloud with promises of optimum query performance, easy scalability, and widespread data collaboration.
“Over the next few years, financial institutions will move market data to cloud,” says Hepsworth. “Rather than taking a lift and shift approach, we built a cloud native microservices architecture with lots of open source technology that reduces cost of ownership, improves productivity and offers faster deployment.” To date, about 45% of Alveo’s clients are using the company’s native cloud solution.
Turning to wider opportunities, Alveo is part of the Snowflake Marketplace. It offers potential users of the data warehouse data cleansing, validation and integration, including last mile integration into workflows. Hepsworth comments: “Clients face the same fundamental problems in the cloud as they did before in terms of cleansing and validating data, and getting data into the hands of consumers, but they are also handling larger volumes of data and looking for scalability and reduced costs. We are seeing uptake of these types of data warehouse solutions that offer a jump forward in technology.”
Business user self-service
To avoid the need for business users to call on IT for data management solutions, Alveo continues to develop its UI for business user self-service and is adding functionality to help clients wanting to simplify operations by using one vendor to do more for them. The company has added a data warehouse to its data mastering, cleansing and validation, and extended UI functionality to focus on ‘views’ that are based on a business domain layer and allow users to set up how they want to see and use data. They can also discover, configure, manipulate and distribute data, the whole supported by data lineage.
Hepsworth also notes increased interest in the company’s Software-as-a-Service (SaaS) and more recently introduced Data-as-a-Service products, particularly among buy-side firms wanting to simplify operating models by outsourcing non-critical data management and accelerate the move to cloud. On the sell-side, Hepsworth notes growing interest in open source technology, growing volumes of data being processed on the Alveo platform, and again, the desire to simplify operating models.
ESG
ESG is a significant opportunity for Alveo. “It’s right in our wheelhouse, ESG data is just like reference and market data,” says Hepsworth, noting the company’s capabilities from managing multiple sources of data to aggregating, storing and distributing the data. The data can also be ‘viewed’ using the company’s UI, perhaps to see both the market data and ESG data attributed to a single entity.
While Alveo has built significant ESG data management capabilities, Hepsworth acknowledges the company’s partnership with Cognizant that helps Alveo understand what clients want. “Financial institutions were looking at whether ESG is a product opportunity of just a regulatory burden, but they are now getting to the data management requirement. We provide quality around ESG data and help clients see what data is available.” Here partnership is key, with Alveo interoperating with vendors including MSCI, FactSet, Bloomberg, ICE Data Services and Refinitiv, a business of the London Stock Exchange Group.
Concluding with a wider note on partnerships, Hepsworth says: “We are focussed on building partnerships. Data management is important, but only one component of the business need.”
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