“FinoComp was started with the idea that the wealth management marketplace had some technology shortfalls,” he explains.
“We’ve got a suite of really monolithic software systems in the market, and the implication of that is the software is very expensive.
“It’s very expensive to test, it’s prone to defects, it’s a massive job when anybody wants to replatform because it’s a massive amount of functionality – taking it from ‘here’ and putting it onto ‘there’.”
Both Aegon’s and Aviva’s respective replatforming problems have been well documented this year. It has been an incredibly frustrating few months for many advisers who have clients on the affected platforms.
We think, fundamentally, that architecture and the way the software is built could actually derisk the whole replatforming exercise, and that’s really core to our belief.Ray TubmanPart of what Mr Tubman calls FinoComp’s “evangelistic approach” to developing software for platform providers is “seeing if you can replace one component at a time” which, in turn, should be less disruptive for platform users.
Mr Tubman says he has drawn inspiration from much bigger technology companies, such as Netflix and Amazon, which use “micro service architecture”.
In layman’s terms, that simply means, “building items of functionality in single, small applications that do one job and do it very well”, he says. Mr Tubman suggests platforms should be able to “pick and choose” software from different providers.
It is fair to say, the replatforming issues have shed light on just how challenging a task it is to migrate customers from one platform to another.
Asked whether the UK wealth management industry is mired in legacy technology, Mr Tubman replies: “There is worse technology in different sectors, but there’s better technology in different sectors.
“But that’s not necessarily a bad thing, because we’re managing people’s money and there is a need for prudence in the industry.”
He says: “We think, fundamentally, that architecture and the way the software is built could actually derisk the whole replatforming exercise, and that’s really core to our belief.”
FinoComp was started in 2015 in Australia by Mr Tubman and his “old school friend” Peter Nicholson. “I think I probably parroted on about my concerns about the wealth management industry and we decided to get together and built some product to start with,” he recalls.
First foray
FinoComp is not Mr Tubman’s first foray into software for the wealth management industry by any means. He was one of the founders of GBST – also a software development company for the wealth management industry – which has its roots in Australia.
The company is probably best known for its ‘Composer’ solution, which is used by Aegon, among other companies, and which Mr Tubman headed up the development of in the late 1990s.
He explains: “We got a lot of major blue chip clients in Australia and then we brought it out to the UK market. That’s why, to be honest I’m working out here [in the UK] because, since 2005, my main focus was on the UK market. That was the cornerstone of GBST.
“We sold the business [known as InfoComp] in 2007 and became part of GBST, and became the wealth management division there. I stayed on for seven-and-a-half years after the sale.”
Mr Tubman considered retiring, but with his wife’s words – “you’re going to be bored” – ringing in his ears, he started FinoComp, which he emphasises is not an extension of GBST.
The business now has several types of “micro services” it offers its UK clients, which include Aegon and Novia.
New services
One of these micro services is TierDrop which, according to the Finocomp website, “calculates the performance of discretionary managed portfolios including highlighting those that have depreciated by 10 per cent as per the Mifid II guidelines”.
Its ‘Charge Definition’ service “enables wealth management companies to create and maintain fees and charges outside of their core system”.
Many of FinoComp’s micro services are developed in response to regulatory requirements.
“It’s interesting, because I read the Financial Conduct Authority interim report into platforms,” he says, admitting he did a “happy dance around the office when I read it”.
“Because there was a lot of focus on costs and charges and they were alluding to the fact that every time an adviser opens up the screen, or a client opens up a portal screen, they should be able to see what charges are being taken and who by, so people are fully aware,” he notes.
“We’ve got a longer-term vision of components we want to build out and we’ll keep it fairly opportunistic, as you have to do when you’re a small company.”
These are the kind of components and software that advisers may not be aware theyare using or relying on when they go ontoa platform.
As Mr Tubman puts it: “It’s like an engine in your car – if it’s working smoothly you just keep driving it – it’s only when it stops working smoothly it becomes an issue.”
Ellie Duncan is features editor of Financial Adviser and FTAdviser
