A common challenge for any investment software provider seeking to provide portfolio and partnership accounting and reporting mid / back office solutions is the perceived cost to a prospective client of the software solution. The Middle East and Indian sub-continent represent the apogee of this concern, given the low cost of accounting labour and of generalist accounting software or even excel.
Typically, scanning the market for specialist investment software, the annual recurring cost of software can be anything between 0.25 and 5 times the cost of an accountant’s salary, depending on the region you are servicing your requirements from, with 1 to 2 times being a general average. And then additionally there are implementation fees, which will typically range from 0.5 to 3 times the annual recurring fees.
So why incur the cost of specialist software?
Well there are two reasons.
Firstly, there is information. Fifty years ago, when any job was performed within the constraints of what a person could achieve in a given time, then time was money. Now, with super-fast and cheap computers, information is money. Getting accurate and timely information is the differentiator when it comes to meeting any goal, particularly in a world where data volumes and segregation are increasingly important drivers of complexity.
FundCount allows clients to move their information speed from weeks and months to minutes and hours, in terms of deliverability. The capabilities inherent in the FundCount software mean that reporting is more robust and accurate, regardless of the data source.
And in case any of us thought that information quality and speed are not tangible issues, then we only have to look to the example of a large complex business running itself on a general ledger software designed for small businesses, as was the case with FTX’s use of QuickBooks
Many organisations run lean. The means that taking on specialist investment software is an absolute cost increase, as there is no slack of staffing to eliminate. However, to assume that operating cost consists only of salaries and software licensing costs and that a traditional dollar based cost benefit determination can be utilised to justify a software purchase is to ignore the principle of uncertainty.
The risks to the integrity and continuity of data are factors that most investment operations will leverage highly, often without consciously doing so. These factors can be measured in the ability of the operating structure to remain stable and deliver the required outputs to the required performance level.
Any instability can arise from something as normal as a staff member leaving, which is very critical in manually driven low technology infrastructures, to external shocks such as Covid-19 or the recent inflationary pressures.
Technology, and specialist investment software, can drive stability into operating cost by ensuring that at a strategic level data is secure and accessible within the organisation and that resilience is built in.
FundCount helps its clients deliver reliable reporting quickly with a strategic and operating cost base that is much more stable.
–Ashley Whittaker, President, Global Sales