On Thursday, May 7th, WealthForge’s Sr. Director of Business Development, Megan Bosch spoke on a panel at Blue Vault’s Bowman Alts Week virtual conference entitled “Technology in Alternatives: Why Now is the Time to Implement.” She was joined by Chris Shaw of SS&C ALPS, Brad West of AIX, John Yuhas of Kalos Capital, and moderator Angie Fisher of CIM Group.
Blue Vault attendees can view a webcast of the panel here.
The panel kicked off with an analysis of how the COVID-19 pandemic has served as a catalyst for change in the industry. While the technology to enable digital transactions has existed for years, adoption has been slow to start. Market participants have built their teams around supporting the manual processes and have been reluctant to undertake the change required to move to electronic solutions. However, today’s work-from-home environment has exposed fatal flaws in relying entirely on traditional paper processing.
To ease the transition, panel members took turns recommending ways the industry needs to shift their mindset and adapt to new ways of doing business. These suggestions repeatedly came back to the idea of not just dipping a toe into the technology pool, but instead putting significant volume through these systems. This helps in multiple ways. It avoids half-measure solutions like stand-alone electronic signature—which digitizes some existing processes, but fails to address manual re-entry of data at various touch points. In addition, significant volume allows the industry to achieve economies of scale, driving down costs and forcing keystone industry players to pay attention and get on board.
Panelists noted that the shift, while seismic in the nature of its potential to grow the industry, does not have require an overhaul of current practices. Today’s solutions are built to fit seamlessly into current back-office activities, complimenting them, but not replacing them.
And while “now is the time to implement” some in the industry are already on board. Sponsors, advisor and brokerage firms, custodians and transfer agents are already using straight through processing technology. John Yuhas noted that rep groups at Kalos that had already adopted the technology prior to the pandemic were less severely impacted by the uncertainty of the market in recent months. Adoption ramping up will help the industry weather future economic storms and catch up with evolving investor expectations.