FundApps helps investment managers harness the power of community and technology to automate regulatory compliance. Hedge Funds Club’s Stefan Nilsson had a chat with FundApps’ Chief Revenue Officer Grant Coombe about what is going on at FundApps.
FundApps has multi-billion-dollar investors and asset managers as clients. But are your solutions for automation of regulatory compliance also suitable for smaller APAC-based hedge funds with smaller teams and perhaps smaller budgets?
It’s a great question as smaller hedge funds have so much to juggle in terms of infrastructure, processes, risk, and costs with often limited resources. That coupled with investors’ return expectations and, in many cases, a need to quickly scale into new jurisdictions, is a lot to manage. The proof is in the new clients that have joined FundApps in January with two Singapore-based hedge funds and one Hong Kong-based hedge fund joining the FundApps community with a range of AUM of sub-US$100 million to US$5 billion. Our smallest global hedge fund has less than US$45 million in AUM and bought our Shareholding Disclosure solution to make sure they could easily scale and future proof their compliance needs.
I see you joined FundApps in London a year ago having lived 11 years in Singapore until July last year. Now, the Asia-Pacific region, where the firm has recently won several new hedge fund clients, is a strategic priority for the firm’s expansion plans. How important is your past experience working in the finance industry in APAC in your current role?
It was a great privilege working in and across APAC over the last decade and it’s given me a truly global perspective that informs how we tailor our approach to the region. I’ve often been asked what our “Asia strategy” is as if it’s a one size fits all approach! In reality, the diversity of financial markets, unique business cultures and nuances must be understood if you want to build long-term partnerships with clients. While that may sound like a bit of a soundbite, one of the key reasons I joined FundApps was because of the incredible loyalty our clients in Asia Pacific and beyond have shown us. Perhaps unsurprisingly, we’ve found delivering outstanding service and a constantly evolving product are key to developing long-lasting relationships.
What are the biggest issues many compliance teams currently face that FundApps can help them solve?
We’ve consistently seen hedge funds compliance costs escalating as they scale their operations and find homegrown excel/bespoke solutions not coping with the demands of regulatory change. Not taking opportunities in new markets due to lack of familiarity with new jurisdictions or having to spend more and more with external counsel are also challenges faced by hedge funds. Whether starting from scratch or growing due to strong performance, we’ve worked with hedge funds to manage their costs and dedicate their attention to delivering returns.
How does FundApps turn its legal expertise into compliance tech solutions for clients?
We have a dedicated team of “Regsperts” who work as members of the Regulatory Content team to tirelessly interpret regulation and code rules. They have client-side compliance, legal and developer expertise which makes them a truly unique resource to both compliance teams and regulators. They monitor hundreds of rule updates from aosphere, an affiliate of the law firm Allen & Overy, and ensure any impactful changes to regulation are implemented across our solutions. Our product and development teams have also doubled in size over the last year to keep ahead of regulatory developments, respond to clients’ needs and continue to invest in compliance architecture.
FundApps operates on a subscription model. Why have you opted for this kind of business model?
We work very closely with our clients and are plugged into their investment compliance processes. Not only do our clients become part of the FundApps community, but we also maintain interactive dialogues with them continually in the face of ever-changing global regulations. A subscription model reflects our true end-to-end managed service delivery that gives them certainty and the ability to scale quickly.
What can you tell us about the FundApps Academy?
The FundApps Academy provides a structured introduction to the most essential aspects of our Shareholding Disclosure and Position Limits content for our clients who need to develop their regulatory knowledge. Let’s face it – there is so much out there that needs to be digested for compliance officers. Just take the EU Transparency Directive as an example. It is time-consuming to simply read all the associated documents, not to mention identifying what’s important. The FundApps Academy provides summarised and relatable content that is easy to follow, and we’ll be launching new courses on EU SSR and US 13F shortly.
FundApps is rapidly expanding across the world, including Asia. What are the biggest obstacles right now? Are you able to recruit the best people to join the firm fast enough to meet demand and take advantage of new opportunities?
As a growing RegTech firm with a global presence, you can be sure of challenges and obstacles but that’s all part of the fun! I would say the biggest challenge is staying ahead of the question, “what’s next?” We have a market-leading service in Shareholding Disclosure currently with over 100 clients globally. But the bigger question remains – what else do we need to do to make compliance simpler and better for our clients? How do we continue delivering value? We have an exciting roadmap that looks at further filing automation with regulators around the world, building ESG capabilities, pre-trade tools, expanded reporting and improving overall data quality as just some of our focuses. There is lots of work to be done! Filing automation is a particular passion for me as we look to build on our direct filing connectivity to ASIC and expand to Hong Kong and Singapore to make short filling simple this year. We’re always on the lookout for great talent and we’ve grown to close to 100 FundAppers on the last count, aiming to expand by at least 1.5x this year. We recruit from the best talent in finance, technology and regulation and bring in expertise from clients, regulators and RegTech firms. If you have recommendations, please let us know!
Despite being a firm in the finance industry working on compliance, FundApps seems to be a fun-loving firm with a relaxed culture far removed from the strict pinstripe suits of traditional investment banks, law firms and such. Tell us about it!
That’s a fair observation! The FundApps culture is driven by our company values that raise the bar, increase transparency, champion accountability. We always work with purpose. Every FundApper lives and breathes our values and that goes into our internal and external communication, our design and service delivery, and how we work with clients. Last year, a compliance officer client gave us feedback that working with FundApps is the “best part of her job” – that made our day! We are humbled to be able to work with so many fantastic clients. We are also committed to making the world a better place to live, work and play in. As of December 2018, we successfully became a certified B-Corp and since then, we have looked to continually improve how we look at governance, our employees, our community, and our environment. We’re here to make compliance simple, make our clients our biggest advocates and have some fun at the same time!