An Interview with Principal Michelle Morgan
What do you do when you’ve been looking for software for your fund administration company but can’t find anything that does everything you want? If you’re Michelle Morgan and Peter McKiernan, Canadian chartered accountants with 25 years industry experience each, you build your own.
The business partners are proud to introduce Titan, an all-in-one, cloud-based portfolio accounting, general ledger, and transfer agency/income allocation platform that they’ve built from the ground up for over a decade to for use by fund administrators and investment managers' back offices.
Tell me how you got started in this business
Our fund administration days go back 20 years, so the software we used was a bit clunky at the time, but the other software products didn’t seem to be much better for the prices they were charging, and for what we thought they should be able to do. For example, we didn’t see any reason that the investment portfolio and investor relations functionality shouldn’t be truly integrated. Peter was the IT guru of our fund admin company and built a lot of interfaces for various programs to move data between the multiple platforms, but this kind of data transfer always results in additional risk and inefficiencies. So we saw the need for an integrated product that would also incorporate the various AML and compliance responsibilities that kept popping up and decided that developing that software would be our next business venture.
And now fast forward 12 years?
It was a long run, but we believed in the product and the need for it the whole time, and I’m impressed with what we’ve accomplished. The Titan Platform is user-friendly, modern, robust and competitively priced. Our RTA/income allocation functionality also includes FATCA/CRS regulatory filing capabilities, US indicia checkers, and customizable compliance templates, and our next release is going to add some exciting and much-needed developments in the private equity/hybrid fund space.
The system includes a sanctions lists name-checking center (similar to World Check) that allows you to click on any potential matches so you can quickly see the results. The system also has a robust and flexible reporting system which will send investor statements out in a variety of ways, including to a portal that clients can white label as their own.
What differentiates you from your competitors?
We saw a need for this technology over a decade ago, so you can imagine that if we thought the available technology was clunky then, it’s totally antiquated now. A lot of the big name fund administrator software providers out there were fantastic in their day, but they haven’t kept up with our quick-changing and demanding industry or the available tech. Their business approach was to add functionality to their offering by acquiring other software programs. For example, they may have started off with a good portfolio accounting program, but as client demand for a share register grew, they bought a share register software company, and then a partnership-income-allocation software company. The programs would have been written in different languages and during different eras so again, trying to interface these would have resulted in some error and inefficiency.
In fairness, back then, who could have predicted that so many different rules and regulations would arise, that the private fund industry would have matured globally, or that the cloud would have become so dominant.
I see you are purpose-built for the web. What does that mean for your clients?
A few things.
It means that posted transactions are instantaneous. Older programs host their software in a physical location and use something like a Citrix Metaframe session, which results in having a half-second delay. A decade ago, that may have seemed fast, but now it makes you feel like you are watching grass grow. Our response time is immediate because Titan is purpose-built for the web. Data that goes through the pipe is also designed to be minimal in order to be efficient.
Another advantage of our SaaS (Software-as-a-Service) model is that we’ve incorporated a methodology called Test Driven Development ("TTD"), which allows us to rely on testing we set up from the start of development instead of having to rely on manual testing later. TTD enables us to turn around additional features more quickly and with more confidence.
Being cloud-based also means that we can be part of your disaster recovery and business continuity plan. We do nightly backups and have triple redundancy servers. If you also want block-level replication to an offsite location, we can do that. So what this means is, if anything ever happened to your office (hurricane, earthquake), you’d just have to go out, buy a laptop, show up anywhere with a wifi connection, and your back office functionality would be back in business. There are all sorts of inherent benefits from our SaaS model. We ensure that security concerns are addressed; in our system, data is encrypted between the browser and the server and then the server and the database, there is intrusion detection on the servers, etc. We can host in our co-location facility (which is in Vancouver, Canada) or elsewhere if you have data residency or security concerns.
If you had one word to describe your platform, what would it be?
That’s a tough one. I’d have to say “flexibility.”
When we give demos, I’m sure the attendees are sick of hearing the word “flexible” by the end! But we remember when we were fund administrators and we would get calls from investment managers to do what seemed like very simple tasks. Unfortunately, because we were bound by the archaic technology at the time, we had to do a lot of manual workarounds, which took a lot of time and often created frustration on both sides.
When we created Titan, we made sure we built such functionality into the system for every one of those workarounds. Do you want a mid-month NAV? No problem. Do you want to give a reduced management fee to one investor for 14 months? No problem. Do you want to include income from new issues in this month’s investor statement? No problem. Do you want different charts of accounts for your different funds? No problem. You get the idea.
We also have a lot of controls built in the system – but again we have made these flexible. The client can decide what functionality should be subject to maker/checker. So if you are a smaller company, you may not need every transaction reviewed and checked by a senior staff member, and that’s entirely up to you. You may want only certain functionality to have additional review controls, and that’s also up to you.
Our goal was to offer a complete back-office/fund administration system, but all of the communication in the platform is via a secure REST API so that we can easily interface with other programs if that’s what our clients want. For example, some clients really like their existing portfolio accounting systems. We are happy to sit on top of these systems, pull the necessary data into our transfer agency/income allocation system, and go from there. We had some clients that also started off this way, just because it was easier to convert one system at a time, rather than all at once.
Tell me about your corporate culture.
We have a fantastic group of brilliant programmers in Vancouver, BC. We wouldn’t have this tremendous platform without their dedication and creativity. As an example, when cryptocurrency first came out, we just set it up as another currency. When the new guidelines came out from the SEC and IRS, I remember going to the programmers apologetically, explaining how we weren’t quite finished and that we’d now have to figure out how to account for more complex accounting logic. Instead of the expected eye-rolling, they were excited to take on this new challenge. They were almost disappointed when they finished putting the modifications through. We were happy last month when we advised that we’d be integrating specific functionality with our new client, GRADA Tokenized Fund Administration, in order to be able to handle tokenized funds (i.e., funds that allow investors to come in with in-kind cryptocurrency subscriptions, hold their investments in a crypto asset class, and allow secondary market trading.)
I also make sure the programmers are included in the strategy and business plans of the entire company and they’ve really taken an interest in the entire fund industry. Some of them have been with us since the beginning, which is fantastic as continuity in software development is very important.
What other features would you like to highlight?
I wanted to expand more on our customizable compliance templates. We wrestled a while with providing flexibility here as each fund administrator, investment manager, and regulatory jurisdiction will have different rules. So basically, we came up with allowing you to create your own compliance templates and then assign these templates to a fund or account. You can also assign templates to contacts and transactions. These can also be set up at your option as a maker/checker control. Within these templates, you decide what documents are needed, what questions need to be answered, and what tasks need to be performed. We also have modern looking dashboards that allow you to track visually where you or your staff are in terms of completion.
So what are your next goals?
We spent years developing a great product and then hit the market. People were blown away during our demos. But there was some hesitation because we were so new and, understandably, it was a big commitment for a company to change their software. So we consciously held back on marketing for a few years and just concentrated on making our existing clients happy and proving the model. We’ve accomplished that now and are excited to spread the word about our platform.
We’re so proud of what our platform can do and are happy to do demos, even to companies that aren’t looking to switch. We love receiving feedback from administrators and investments managers as this helps us learn what they’d like to see in their software, which helps us improve our offering.
Michelle, thank you. How can people contact you about Titan?
If anyone has any questions or would like to set up a demo, please contact me at the details below.