When Architas was launched in 2008, the business plan was to break even after five years but as its chief investment officer Caspar Rock acknowledges “we got there after about three [years]”.
Clearly the business, which is owned by Axa Wealth, has grown faster than anticipated.
Harking back to the early days of Architas, Mr Rock reveals that the working title for the firm, which specialises in multi-manager investing, was “Lone Wolf”. But he is the first to refer to the role Axa Wealth has played in its growth, pointing to the Axa logo on his business card to stress the point.
He says: “We’ve taken in a lot of money but we clearly have to thank the distribution power of Axa, which has really helped us, especially in multi-manager. It’s not enough just to have a good product, you’ve got to have strong and deep distribution as well and I think that’s what does benefit Architas.
“Calling it Lone Wolf, the idea was to build our own culture and our own sense of identity to make people feel part of a small and fast-growing business.”
Architas started life in the Gherkin – the iconic building at 30 St Mary Axe in London – where Mr Rock was one of only 10 to 12 employees at the time. “I walked in through the door with my funds… they were the assets and I was the liability,” he laughs.
He admits they quickly outgrew their office space at the Gherkin and now the business has roughly 90 employees at its Moorgate site, with staffing levels expected to rise to around 120 people by the end of the year.
So how did it all start? For Mr Rock, his three years at Exeter University set him on the path to asset management, having read statistics. On graduating, he did “the usual jamboree of interviews” with investment banks and eventually secured a place as a graduate trainee at a consortium bank called Orion Royal Bank. He recalls working closely with its group economist before the company was subsequently folded into the Royal Bank of Canada. Mr Rock spent some time working at its stockbroking function that had a “wonderful name”, Kitcat & Aitken, where he did some credit research.
He continues: “Then one of the guys on the desk left [to work for the Industrial Bank of Japan]. I had worked very closely with him on looking at euro bonds and European government bonds in the late 1980s, which was a very different market from where it is today. About six months later he rung me up and said, I have a really interesting job, would you like to come and do it?”
While at his previous job he had a “roving remit”, at Industrial Bank of Japan Mr Rock had a narrower focus, researching European equities and eventually running a European equity fund there.
“So I ended up running European equity money and convertible bond money and I did that between 1990 and 1995. I learnt a lot actually; a lot about different cultures as well,” he says. “Both Orion and IBJ [Industrial Bank of Japan] had pretty multicultural backgrounds which I really enjoy.”
Cutting his teeth at companies with such diverse workforces has helped shape how Architas looks today, as Mr Rock goes off on a brief tangent to insist he does not “want everybody being completely one dimensional”.
He says: “So whenever I employ anybody, I don’t look for someone who looks like me. [Instead] I ask myself what I haven’t got and try and fill that gap. Having all sorts of diversity I think is great because it adds to the dimensions of the discussion you can have, I think it’s very interesting and gives a good dynamic to any group of people.”
Returning to his career, Mr Rock reveals it was a phone call in 1995 that prompted him to join what was then called Framlington.
He explains: “I got a phone call saying, would you like to come and chat with us at Framlington because we are looking for a European equity fund manager?
“I thought, might as well go and have a look. What I liked about it and found very attractive was it was a small boutique and it had a great culture. I went in there to run the European equity fund.”
Then followed a stint as lead manager of the Framlington International Health Portfolios fund, an area he says he had a “real interest” in. Axa later purchased Framlington in November 2005. Mr Rock replays a conversation he had with the chief executive at the time.
“He said to me, look Caspar, you’ve done quite a lot of stuff… so do you want to have a look at our multi-manager business at Axa Investment Managers?” he recalls.
“There was I sitting at Framlington saying, I’ll go and have a look at it and see what it is. It was quite a big business but it wasn’t quite working.”
About a year later, Axa bought another business that had “a reasonable range of assets” called the Elite funds, which was a fund-of-funds business. The final link in the story is the chief executive of Axa Wealth, Mike Kellard, who, Mr Rock reveals, came up with the idea for Lone Wolf, which became Architas.
“He proposed to set up a business… which was to provide open-market investment solutions for Axa Wealth distribution. They brought together the team that were running the Elite money within Axa Wealth and they also brought the business [over] from Framlington,” he says.
Architas now has three ranges of open-ended funds and one insured funds range, with combined assets under management of £3.5bn to £4bn. For Mr Rock, it is vital the ranges are easily understandable to the end investor, in addition to performing well.
Turning his attention to the future of the business, he observes: “I’ve got three areas of focus. The first one is running the investment team, ensuring we are producing the performance we’re trying to produce.
“If we’re doing too well I’ll ask, is it time to take some money off the table? So I spend quite a lot of time playing devil’s advocate.”
He continues: “Second thing is, we’ve launched a couple of new funds and we’ve got to ensure they do exactly what we thought they would do.”
With Architas approaching its seventh year in business, there are clearly more ambitious plans for the firm, as he reveals: “We now make a good contribution to the Axa profits globally and we’ve proved our concept, and they’ve now asked us to take in certain other parts of the Axa business in Europe to consolidate and build a hub, or a centre of excellence, for multi-manager product for Axa in Europe.
“Those are the three key tasks we have for 2015.”
Mr Rock is nothing if not enthusiastic about the business and its ability to grow, noting “it’s been an enjoyable thing to do as well as intellectually fulfilling”.
On how Architas has developed in a relatively short period, he believes: “It’s a really fantastic transition. But what you have to understand is when you’re a really small business everybody rolls up their sleeves and they’re a generalist at everything.
“But as you get bigger, what does happen is you become more specialised and less generalist. I’ve really enjoyed seeing that change and developing people into doing things they never dreamed of doing.
I think at Architas we do have a very strong sense of identity and culture; we’re proud of what we’ve built, we really are.”
CV
Caspar Rock
2011 – present
Chief investment officer, Architas
2008 – 2011
Deputy chief investment officer, Architas
2006 – 2008
Head of investments, Axa Framlington Multi-manager
2001 – 2006
Lead fund manager, Framlington International Portfolios Health fund
1995 – 2001
Head of pan-European core funds and lead manager, Framlington European Unit Trust
1990 – 1995
European equity investment manager, Industrial Bank of Japan International
