Ireland punching above its weight in fintech and fund services

Ireland is a hub for the provision of fund management and administration services to the international funds industry, with a large and growing talent base. This, in turn, has provided a seedbed for entrepreneurship, with a number of Irish start-ups providing solutions and services to the global sector.

Most frequently these start-ups are founded by people who worked for the fund advisers and spotted an opportunity that wasn’t being met by the mass market, or a problem that the mass market wasn’t trying to solve.

In devising a solution, such individuals are helped by the fact that not alone has Ireland a strong and vibrant entrepreneurial ecosystem, but it also has deep pools of talent built up in the ICT sector, helped by many years of success attracting overseas foreign direct investment from some of the biggest technology companies in the world.

It’s also a small, well-networked business community, predisposed towards meet-ups and knowledge-sharing. Ease of access to so many of the world’s leading multinational companies has provided Ireland with an opportunity to devise global solutions, which often surprises overseas buyers given the small size of its home market.

Demand for innovative solutions has grown since the financial crash of 2008, as central banks worldwide sought to sharpen oversight not just of banks but of a range of financial institutions. This required new resources, both in terms of systems and personnel. For many, the easiest and most cost-efficient option is to outsource.

Fund Recs

Among the innovative start-ups in this space is Fund Recs, which was established in 2013, after the company founders were approached by a large bank to develop a new reconciliation platform for its fund administration unit.

With more than 25 years’ operational and technology experience between them, the team has built a platform to transform how data is managed, processed and leveraged by the funds industry.

By combining ease of use with powerful processing, flexible data import and key industry knowledge, Fund Recs’ mission is to develop the most efficient, powerful and cost effective reconciliation software available.

Since 2012 Irish start-up Eagle Alpha has provided a full-service solution that enables investors to analyse alternative data such as social media.

Its asset management clients include quantitative funds, discretionary hedge funds and traditional fundamental asset managers. It works with clients that are starting to integrate alternative data as well as sophisticated users that use Eagle Alpha to complement their in-house capabilities.

It is now a recognised leader in the alternative data space, regularly hosts flagship events on alternative data in New York, London and Hong Kong, and aims to be the “go-to” firm for the alternative data needs of asset managers.

Ireland is now a global hub for fintech within the funds industry, says Billy Hanley, senior development adviser at Enterprise Ireland. "Both funds and technology industries are strong contributors to our economy, and new products will emerge through the alignment of these skill sets."

Regtech offers a particularly attractive opportunity for young Irish companies to compete internationally, and Enterprise Ireland has supported a number of start-ups in this space in recent years, he says. “These companies are now gaining traction and have considerable potential to scale internationally and expand their global footprint.”

CENTRE OF EXCELLENCE

It’s not just Dublin that benefits from Ireland’s burgeoning funds services sector. The Carne Group, for example, which was founded in 2004, is the largest independent provider of fund management company services in Ireland and a leading global provider with assets of more than $60 billion (€52 billion) under management.

In 2017 it announced a significant expansion of its operations with the opening of a new regulatory technology, development and operations centre of excellence in Co Kilkenny.

Last year saw Centaur, which delivers independent fund administration and regulatory services across the globe, open a second office in Maynooth.

The Kildare town is also home to regtech firm AQmetrics. Established in 2012, it has been ranked as one of the top 50 European businesses transforming financial services and recently raised a €3 million investment to fund European expansion.