Navigating AI Innovations in Private Markets

Welcome back to the Alt Goes Mainstream podcast.

Today’s episode dives into how operations and streamlining technology processes can be turned into a strategic advantage.

We sat down with Arcesium’s MD and Head of Client and Partner Development David Nable to discuss how technology is impacting how funds manage their processes, operations, and data.

David was an early employee at Arcesium, helping the firm scale and working with many of the industry’s largest asset managers across the lifecycle of an investment. David joined Arcesium after a career in fund services and fund administration that spanned senior roles at Goldman Sachs, Credit Suisse, and BNP Paribas Securities Services.

David and I had a fascinating conversation. We discussed:

• How David’s background in prime brokerage and fund admin helped him approach the technology problems for asset managers.
• How asset managers should approach where and how technology can be a strategic advantage.
• What does it mean to be a tech-forward asset manager?
• How does the growth of evergreen funds impact how firms manage their data and serve investors?
• What still needs to be built next to continue to improve private markets market infrastructure.

Thanks David for coming on the Alt Goes Mainstream podcast to share your expertise and wisdom on private markets technology and post-investment processes.

A word from AGM podcast sponsor, Ultimus Fund Solutions

This episode of Alt Goes Mainstream is brought to you by Ultimus Fund Solutions, a leading full-service fund administrator for asset managers in private and public markets. As private markets continue to move into the mainstream, the industry requires infrastructure solutions that help funds and investors keep pace. In an increasingly sophisticated financial marketplace, investment managers must navigate a growing array of challenges: elaborate fund structures, specialized strategies, evolving compliance requirements, a growing need for sophisticated reporting, and intensifying demands for transparency.

To assist with these challenging opportunities, more and more fund sponsors and asset managers are turning to Ultimus, a leading service provider that blends high tech and high touch in unique and customized fund administration and middle office solutions for a diverse and growing universe of over 450 clients and 1,800 funds, representing $500 billion assets under administration, all handled by a team of over 1,000 professionals. Ultimus offers a wide range of capabilities across registered funds, private funds and public plans, as well as outsourced middle office services. Delivering operational excellence, Ultimus helps firms manage the ever-changing regulatory environment while meeting the needs of their institutional and retail investors. Ultimus provides comprehensive operational support and fund governance services to help managers successfully launch retail alternative products.

Visit www.ultimusfundsolutions.com to learn more about Ultimus’ technology enhanced services and solutions or contact Ultimus Executive Vice President of Business Development Gary Harris on email at gharris@ultimusfundsolutions.com.

We thank Ultimus for their support of alts going mainstream.

Show Notes
00:00 Introduction to our Sponsor, Ultimus Fund Solutions

01:52 Welcome to the Alt Goes Mainstream Podcast

02:04 Guest Introduction: David Nable

03:46 David's Career Beginnings

04:15 Parallels Between Running and Finance

05:19 Observing Industry Trends

06:45 Evolution of Private Markets

08:45 Impact of Technology on Investment

09:40 Challenges in Scaling Investments

11:20 Data-Driven Investment Strategies

12:50 Technological Advancements in Finance

13:52 Importance of Foundational Data

17:31 Data Silos and Harmonization

18:14 Case Study: Investor Relations

21:25 Data-First Approach Benefits

21:51 Timing for System Architecture

23:21 Inflection Points for Managers

23:37 Logical Breakpoints in Strategy

23:44 New Strategies and Geographies

23:47 Adapting to New Asset Classes

23:50 Distribution Channels and Partnerships

23:56 Preparing for Future Growth

24:00 Publicly Traded Private Markets

24:14 Tackling Technological Challenges

24:24 Philosophies on Illiquidity

24:25 Conclusion and Future Outlook

24:29 Investing in Scalable Distribution Channels

25:12 Architecting Technology Systems for Business Growth

25:44 Understanding Data in Different Business Models

27:10 Strategic Role of Technology in Investment Firms

29:35 The Paradox of Data in Decision Making

30:49 Competitive Advantage Through Faster Information

31:45 Impact of AI and Technology on Firm Sizes

32:31 Challenges for Mid-Sized Firms

33:13 Technology as an Enabler for Niche Specialists

34:03 Advice for Mid-Sized Firms on Technology Implementation

35:10 Focus on Big Technology Investments

35:29 Point Solutions vs. Platforms in Private Markets

38:52 Cost of Technology Solutions

39:06 Integration Challenges with Multiple Systems

40:59 Arcesium's Technology Platforms

43:18 Simplifying Complex Investments

46:13 Future of Software Innovation in Private Markets

46:39 AI as a Game Changer in Private Markets

47:34 Efficiency Gains Through AI

48:05 Actionable Advice on Using AI

48:15 Caution Against Vibe Coding

48:58 Importance of Proper Technologists

49:23 Timing of Technology Implementation

49:29 Conclusion and Final Thoughts

Editing and post-production work for this episode was provided by The Podcast Consultant.