The Future of Investment Management Is Here – And To My Surprise and Delight, So Am I

September 9, 2024
Dave Blair, CEO
4
 min read

Key Takeaways

CEO Dave Blair was in the investment industry for 28 years prior to joining Ridgeline
He knew the problems the industry was facing and what needed to be done to solve them
Ridgeline unlocks growth and efficiency by being a single, real-time platform with the same data everywhere

In 2019, prior to joining Ridgeline, I was in the Chicago office of a large investment manager, listening to them vent about their investment management technology. I’ve been part of teams building technology for this industry for my entire career, focused on serving firms like theirs. (I did have a brief stint after college in disability insurance underwriting and then insurance sales, but that’s another story.)   

I distinctly remember this customer’s operations team expressing frustration that if a deposit wire came in too late that morning, their system could not “sync” the cash between systems, and they would have to wait for the next day to invest it. This issue was one of many and emblematic of the state of the industry. It hit me sitting there: Why are we in this situation in 2019 with the steady progression of computing power, modern software architectures, and cloud technology? 

Shortly thereafter, Jack Lynch from Ridgeline contacted me out of the blue, asking whether I had any interest in joining an industry startup solving that very problem in a small town in Tahoe called Incline Village, NV. The rest is, as they say, history. I had been working to solve customer problems and provide value in the investment management software industry for 28 years by that time. With Ridgeline’s vision, I finally saw the opportunity to change the game and help move investment managers out of the legacy Ice Age and onto a modern platform. 

Why was that particular investment manager in Chicago and other managers like them in that situation? Because legacy technology has not kept up with modern technological advancements such as GenAI, service-based architectures, and hyperscale cloud advancements from providers like AWS, Google Cloud, and MS Azure. I joined Ridgeline because then-CEO and Founder Dave Duffield is known for building phenomenal cultures, being maniacally focused on customer service, and taking a long-term view to build durable companies that leverage paradigm technology shifts (such as Workday, which he co-founded). Fortunately for me and the rest of us at Ridgeline, Dave focused his sixth and final big venture on the investment management industry. That decision was greatly influenced by Dave’s personal relationship with renowned New York investment bank Allen & Co.   

As the story goes (I had yet to join Ridgeline), the Ridgeline team pitched a couple of ideas for a new business vertical software company to a small group at Allen & Co., including Ridgeline’s now Board member George Tenet and our close advisor Ashok Chachra. George and Ashok kindly listened to Ridgeline’s bold ideas, shot them all down (for good reasons), and then wisely suggested that the investment management industry was primed for new thinking about how they operate from front to back. Current systems were 25+ years old and disparate; upgrades, painful; integrations, fragile; licensing models, complex. And, most intriguing of all, nobody was investing in future technologies – exactly the kind of challenges that Dave Duffield has built his career on. 

So Dave and the Ridgeline team went all in to build a modern investment management platform. Thanks to Dave’s vision and his proven enterprise software playbook, the goal from the start was to build and leverage a modern platform — end-to-end, secure, scalable, integrated, extensible, and in the cloud.

But exactly how does this technology word salad give investment managers the opportunity to grow, retain investors, and maintain profit margins? With these strategic advantages: 

  • Enhanced decision-making with consistent data and insights available to everyone in the firm everywhere they have an internet connection on any device. You can make investment and relationship decisions on one single, accurate data set in near real-time. 
  • Elevated client engagement. Investor-facing teams are empowered to acquire, grow, and retain clients by leveraging Ridgeline’s unique 360-degree view of relationships with all the data in one place. This includes near real-time insights into direct relationships, related parties, intermediaries like model delivery and SMA wrap programs, and multi-generational households. 
  • Measurable and quantifiable efficiencies. A few of the many examples include reducing cash drag, reconciliation time, client onboarding efforts, compliance rule management, and cross-team friction. Your entire firm has access through an enterprise license model, which means there will be no more emailing screenshots and Excel downloads to each other.
  • Reduced firm risk through world-class Ridgeline security, compliance, and availability. For example, reduce operational risk by setting up investors once instead of across five to ten systems. Have confidence that the compliance rules are in place before trading. Know and measure what is happening across your firm through a robust workflow engine and task management. 

A common objection to a new paradigm is that the legacy operating environment is “not that bad” today. Not that bad? Well, in 2007, having a flip phone, a GPS device, a camera, a music player, a rolodex, and a watch was not that bad. We can all agree that unifying those devices into a single platform called a smartphone has unlocked efficiencies and possibilities that were not even conceivable at the time. 

I feel the same about Ridgeline. Combining portfolio management, accounting, order management, compliance, CRM, and revenue management on a single platform with a unified data set in the recently arrived age of GenAI will unlock efficiencies not yet contemplated (or only contemplated in expensive-to-build and impossible-to-maintain data warehouses). The industry needs to fix the system of record problem before adding yet more integrations and expensive tech that is difficult to get right and impossible to maintain. Ridgeline is the answer to the multiple system of record problem. 

Doing nothing is a decision. It’s a decision to fall behind. Technology is moving faster than ever today. The investment business is going through constant evolution. Legacy solutions are upgraded every two to four years. Where do you think GenAI will be in four years – or even four months? 

Ridgeline is a native cloud SaaS solution, which means that individual parts of the overall platform and applications are updated continuously, and new technology, such as GenAI, can be integrated seamlessly. Notice I said updates, not upgrades. Upgrades get retired with your legacy system when you move to Ridgeline. There is only one version of Ridgeline, which means 20-30% of Ridgeline’s overall development investment is not spent on patching multiple versions of code. Instead, that investment is focused on new value delivered continually to Ridgeline customers. Do you want to pay 10% more per year plus consulting fees to upgrade every two to four years before receiving any new value? With Ridgeline, you can be confident your dollars will translate to accelerated, innovative value delivered back to you, which you can pay forward to your own clients. This is why true SaaS companies quickly outrun their legacy competitors. 

Ridgeline is determined to listen to our customers and figure out how to solve problems to help firms grow and increase efficiency. This is our mission. Sticking with legacy technology is like navigating with a paper map while everyone else uses GPS on their smartphone. By the time you’ve figured out where you are, they’ve already taken the quickest route and arrived at the destination. For me, that destination is the future of investment management. 

We would welcome the opportunity to speak to you about how Ridgeline can help move your firm forward. Send us a note at hello@ridgelineapps.com.

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