The hedge fund market is undergoing fast-paced change, with financial institutions innovating on the product side and also entering new markets with different approaches to trading. Asset managers and investors are under immense pressure to adapt to the plethora of changes, including rising competition, stringent regulations, and increasing expenses. Additionally, from a technological perspective, many of these organizations still use obsolete systems that have limited ability to adapt to new changes. To solve these post-trade challenges, fund administrators and sovereign wealth managers require a different operational approach that incorporates flexibility and problem-solving ability. Striving to eliminate these post-trade problems from the alternative asset industry is Arcesium, a technology and tech-enabled services company that offers a gamut of comprehensive and flexible middle and back office solutions designed to meet the needs of today’s alternative asset managers.
From real-time integration with order management systems to fortified and automated oversight of third-party administrators, Arcesium offers a unified and robust solution for the entire post-trade process. “At its core, our platform is designed to enhance the daily and monthly middle and back office processes of asset managers,” states Libby Vanderkaay, Head of Account Management, Arcesium.
By following a partnership model, Arcesium advises the client every step of the way about the different options to add value to their middle and back office. The Arcesium platform, including its sophisticated treasury functionality, was designed, built, and tested by the company’s professionals within the D.E. Shaw Group, a global investment and technology development firm. The company utilizes proprietary software, technology, and an experienced team of professionals to deliver complete post-trade support.
The secret behind the company’s success is its deeply knowledgeable industry experts and sophisticated technologists, who have decades of combined experience in the asset management industry and know how to meet the needs of their clients. Arcesium understands that their clients may often not be ready for the risk and complexity of a full replatforming of the middle and back office. Here, the company offers a selection of point solutions that can plug into whatever the clients’ needs are, such as data and security measures. For instance, Arcesium offers its Financial Data Stack product, comprising a series of rapidly deployed, highly configurable modular technology applications that are easily integrated with other systems. To address the security aspect, Arcesium’s platform offers a dedicated virtual private cloud for each customer to store data. Arcesium also carries out regular asset testing and has a strong security program in place to ensure the safety of its customer’s data.
“As part of our commitment to being a strategic client partner, all of our modules are essentially fully API-driven and built natively in the cloud. They are easily integrated with anything else, whether it be Arcesium technology or external,” states Vanderkaay. These solutions help master, store, and distribute relevant data sets, empowering clients to make critical business decisions from a single source of truth.
Illustrating Arcesium’s work, Vanderkaay cites a scenario in 2019 where a client was looking to migrate their fund of funds business to the Arcesium platform. The client needed to determine how to model their full business, including complex fund structures and fee calculations, in Arcesium’s solution. Through a partnership approach and creative problem solving, Arcesium developed a multi-month project plan to build the new capabilities required and on-board dozens of new entities to the platform. “For our clients, we want the experience to be like having a great in-house tech team that also has all of the expertise of working at the forefront of the industry. In this case, we proved that by committing to new development plans and building out teams to service the fund of funds business from implementation through go-live,” says Vanderkaay. Arcesium was successful in helping the client understand the structure of their assets and how to service the business as it scales globally.
Arcesium is driven by the mission to power the entire investment lifecycle. Having started by catering to the middle and back office, the company is now responding to what their clients’ needs are and continuing to build more sophisticated capabilities that extend across the full lifecycle. Arcesium is also investing more in its scalability. As a part of its expansion plan, the company is planning to extend its footprint in London. With Arcesium’s impressive success, the company is attaining significant growth through word of mouth.
Arcesium’s Libby Vanderkaay was interviewed for an article in the March 2020 issue of CIO Review. The March 2020 issue was released as the CIO Review 20 Most Promising FinTech Solution Providers – 2020 special report.