SAN FRANCISCO (HedgeWorld.com) – Aiming for the top spot among hedge fund software providers, Advent Software Inc. is marketing its hedge fund technology as a package made up of the many pieces ofits technology arsenal.
Even as the firm officially launches Advent for Hedge Fund Mangers, hedge fund users already total more than 400, a good number of which are among the larger hedge funds in the industry. Advent also does business with eight prime brokerage units and four hedge fund administrators.
“Quietly we have become a dominant player in the hedge fund market and prime brokerage arena as well,” said Peter Hess, vice president of marketing at Advent.
Promoting the idea of one-stop shopping for hedge fund managers searching for integrated front-office and back-office systems, Advent is selling a package containing five modules that can be split up or combined as one depending on a manager’s needs. The five modules are: fund accounting and reporting; partnership accounting; investor relationship management; trading and portfolio management and prime broker reconciliation.
Available in two versions, standard and premier, the software system offers a variety of options for managers. The standard offering is used by 380 hedge funds and includes the Axys portfolio management program that portfolio accounting, profit and loss measurement and reporting tools. The Geneva system is offered to premier users, which tend to be the largest hedge funds, the top 15 hedge funds, according to Mr. Hess.
More than 25 hedge funds using Advent have more than US$1 billion in assets. So far most of the software sold to hedge funds has been the Geneva system, which is the portfolio accounting engine that has extensive securities coverage, multi-dimensional P&L reportingWith three years of Geneva sales under their belts, Advent marketers expect the pace of Geneva implementation to accelerate.
In the last year alone, more than 40 hedge funds have signed on to Advent’s software including AQR Capital Management LLC and Canyon Capital Advisors. In a statement, Aaron Goldberg, chief financial officer of AQR, said that the firm had been using a system that was labor intensive and required them to jump through hoops to extract data.
“We chose Advent to support our business because of the breadth of its product coverage, its open and scalable technology platform and the support we can rely on from the organization,” he said.
Partnering for Success
That client support comes in many forms and Advent has been active in initiating third-party relationships to benefit hedge fund users.
Last year, Advent added on to its offerings by partnering up with Financial Interactive, which offers an investor relationship management tool called Fund Runner. Advent signed an alliance agreement with Financial Interactive as a way to help hedge fund managers compete in attracting investors who are often implementing more stringent reporting requirements.
Other partnerships have also been fruitful. Through a deal with Vestek, Advent can provide access to that company’s performance attribution software. Teaming up works well for Vestek too, since officials there are also targeting the hedge fund space, said Mr. Hess. A third key partnership is Ernst & Young, where through a strategic alliance with the hedge fund auditor provides Advent hedge fund clients with best practices consulting and general business expertise.
“We do have a company that is going to be around and we are invested heavily in the systems,” Advent’s Mr. Hess added. These technological links already established with prime brokers are helping to streamline back office processes among its hedge fund clients.
