Last month, we hosted our first post-COVID 19 event in Asia. Set against the impressive backdrop of the Singapore skyline, some themes emerged around technology, talent and transformation in private markets fund administration.
Embracing hybrid and remote working to retain talent
High workforce attrition and talent shortage currently plague most industries, and as companies continue to embrace digital transformation, strong demand for skilled tech professionals is expected to persist. The development and retention of top talent has, therefore, never been more imperative for tech companies. SS&C’s smooth migration to home working over the past two years is supported by positive client feedback on delivery and results, and has motivated the company to maintain flexible working options for its employees. Flexibility is a key driver of a company’s ability to retain talent.
Capitalizing on growth opportunities
Many companies lack long-term focus given restrictive ownership structures, while others do not have control over their technologies due to strategic decisions to outsource them to a third party. SS&C’s success in retaining top talent has allowed the company to continue to capitalize on strategic growth opportunities and it is well placed to maintain its leadership as the largest player within the fund administration industry. The company’s stable ownership structure has allowed it to remain at the forefront of technological advancements which have catalyzed the industry.
New avenues for expansion within the historically manual, private markets space
2021 was an exceptional year for private markets, backed by record-breaking private equity deal activity. Global private equity deal volume was up by 48.6% in 2021, reaching US$2.04 trillion, and the number of deals exceeded 14,000 for the first time, according to data from McKinsey & Company. Buoyant markets have spurred growth of larger general partners, which continue to dominate the sector. However, increasing demand for boutique managers, which focus on niche markets, is also gaining traction, attracting a growing share of capital from investors.
Supporting the development of private markets institutions with enhanced technological capabilities is a significant opportunity for companies like SS&C. The private markets industry remains at the early stages of digital maturity, having been historically slow to adopt new systems and processes. Many firms are still burdened with antiquated technologies, and are now feeling the mounting pressure from investors and heightened competition from peers.
This also holds true for private market middle-office operations. While outsourcing such capabilities to third parties is not a new trend for private market institutions, limited partners are becoming increasingly sophisticated and are demanding more data and analytics at a higher frequency and faster speed.
Private Debt Opportunities Accelerating in Europe
Another growth area for SS&C lies within the global private debt market. The appetite for such funding has accelerated in Europe and the US in recent years, and 2021 marked the tenth year of consecutive growth. Assets in the segment grew to US$10 trillion in September 2021, nearly five times as much as in 2007, according to Preqin, a financial data provider. While Asia currently only represents a small fraction of the global private credit market, demand is expected to continue as companies in the region progressively look to diversify debt financing away from bank loans. Blackstone, the world’s largest alternative asset manager, is seeking a tenfold increase of assets in its Asia Pacific credit business, to tap into this growth. Many private market institutions do not currently have the technological capabilities to handle these more complex private debt structures, and are turning to companies such as SS&C to provide such solutions.
The confluence of growth potential in private equity markets and increasing shifts to digitization present an attractive outlook for SS&Cs fund administration business for private markets, and we remain confident in capitalizing on the opportunities this offers.
Singapore continues to be an attractive hub for business and innovation
Singapore has always been regarded as a major business and innovation hub in Asia. It is a gateway for the region’s top multinational companies and fast-growing start-ups, thanks to its favorable business regulations. Having built a vibrant ecosystem featuring global R&D labs for leading corporations as well as startups, we remain optimistic that Singapore will maintain its leadership in attracting global companies to base their creative centers in the country. We believe that Singapore’s continued ability to attract talent will support these trends.
About SS&C Private Markets – Singapore
The SS&C Private Markets business provides industry-leading technologies and solutions, which aim to achieve efficiencies and reduce complexities across middle and back-office functions in private markets businesses across Singapore. We are committed to bringing best-in-class solutions to managers of all sizes—from start-ups, to boutiques, to institutional asset owners.
If you would like to learn more about how SS&C’s services and software can support your business, please contact us.
Alternative Investments, APAC, Asset Management, Fund Administration