The combination of Asset Control and TAP Solutions creates a data management product line-up capable of meeting the requirements of financial institutions of all sizes globally, according to the new Asset Control CEO Phil Lynch. For larger institutions, the merged systems offer the prospect of an integrated solution for centralised data management supported by downstream data marts. Plans to build out-of-the-box connectors to a range of applications as well as datafeed handlers will bolster financial institutions’ ability to get rapid results from data management projects, he contends.
Lynch, the former CEO of Reuters Americas, replaces Asset Control founder Ger Rosenkamp at the helm of Asset Control, as Fidelity Ventures, where Lynch was latterly a venture partner, takes a majority stake in the company and underwrites the concurrent acquisition of Vancouver-based TAP. Rosenkamp retains an investment in Asset Control and becomes chairman of the newly created board of directors, so far peopled by Fidelity Ventures partners Anne Mitchell and Simon Clark.
During his time at Fidelity – a role he now relinquishes to head Asset Control – Lynch identified data management as among the “foundational” issues firms need to address as they upgrade their infrastructures to cope with the need for speed and efficiency in the commoditised markets and the complexity created by increasing investment in structured products. Based on significant market research Fidelity reckons it has exactly sized the market for data management systems – though it declines to reveal its findings – and has taken a bet that Asset Control with the TAP assets rolled into it has the best opportunity to convince firms to redirect their spending on data management away from inhouse builds and into third-party solutions.
“The money is locked up inside the firms and we need to unlock it,” Lynch says. “The decision today is between buy and build. We have to help our customers get value out of their data projects very quickly. We want repeated successes with industry leaders, to move people away from proprietary builds.”
For his part, Rosenkamp believes the Fidelity investment and the appointment of Lynch as his successor serve to neutralise concerns among current and prospect Asset Control customers about the future commitment and ability of the company – which has been profitable for 10 years – to remain in the data management systems business. Insisting the company did not need to raise equity capital, he is bullish about his choice of investor. “I’ve been approached by dozens of VC firms, and I have entered into some discussions. Often they are investment pools. Fidelity is different because it’s their own money. This makes Fidelity Ventures more like a regular investor than an equity investor.” Fidelity can hold the investment for as long or short a period as makes sense; for Fidelity and for him, as long as the ROI is sufficient, there should be no need to seek to change, he suggests.
Lynch highlights the fact that Fidelity has not syndicated its investment in Asset Control – which he describes as “significant” for the company – with other VCs. “That is testament to their confidence, that they didn’t spread the risk,” he says.
The synergy between Asset Control and TAP centres on the fact that they are the only two companies in the space that are “product oriented”, Lynch says. While this is a statement some of the other data management providers might dispute, the issue is whether each client has the same platform installed, or whether each is different. “We wanted a scalable, repeatable business,” Lynch says.
Also key is the fact that AC Plus is targeted at the enterprise space, while TAPMaster is suited for data access (as opposed to enterprise data management) and appeals to smaller buyers. “The combination of Asset Control and TAP is very powerful,” he says. “We have the two product oriented offerings on the market, and can service the market from top to bottom. We can also offer a front to back solution comprising data management and downstream data marts to make the data available to users.” Lynch is hopeful that some of the existing Asset Control customers will be interested in replacing the downstream data marts they have built with TAPMaster, and also envisages entering into OEM agreements with application providers to bundle or embed TAPMaster into their solutions.
Work to integrate AC Plus and TAPMaster is under way, he says. The two solutions are not technologically similar – TAPMaster is built on Microsoft technology – “but that is OK because they do different things”. Simon Blyth, vice president, sales and alliances for TAPMaster, adds: “People overplay the importance of the differences between the two systems, and the fact that TAPMaster runs on a Microsoft platform. Operating systems and databases today are built to be able to talk to each other. At that level, integration is only an issue insofar as people perceive it to be one. The integration issue really is more about functionality and ensuring that one plus one is made to equal three. That’s what matters to the end client.”
Lynch – who will take the role of global sales head until there is a hire in that area – envisages the creation of an “ecosystem” around the Asset Control solutions, with out-of-the-box feed handlers and connectors to applications. These should make it possible to get data management systems up and running within firms in a matter of months, he says. “A lot of the projects firms are undertaking are taking too long to deliver business benefit.” Addressing this problem will help to convince the market that buying, rather than building, is the way forward for data management, he believes.
The “ecosystem” approach should also help data vendors to capitalise on the enterprise opportunity, Lynch contends. “If it’s easier for customers to take in their data and use it, there is the possibility for huge growth throughout the enterprise, moving away from just the front office focus,” he says. “This should be a record area of growth for them. It is a different business model from the old screen-based model. I can help the data vendors become enterprise providers,” he concludes.