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Put pragmatic governance in place to capitalise on data assets

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Without effective data management processes in place, organisations face unnecessary costs, risk and delays, says Infovest.

By Michael Willemse – Head of Technical Implementation at Infovest

Now more than ever before, organisations need timely, accurate data to support everyday operations and business growth. An inability to capitalise on data assets could have far-reaching effects, such as unnecessary costs, operational delays, or exposure to risks.

But not all organisations have the capacity to tackle large data governance initiatives; facing constraints in terms of organisational size, team structures, information system architecture, timelines, or directives.

In these cases, a pragmatic approach to data governance is needed. Organisations need to consider which processes and tools are crucial, how to embark on a culture of continuous improvement, and what needs to be done to build a platform for future governance.

Start with strategy

The first step is to constitute a data governance team with a clearly defined strategy to provide the stimulus and direction for the change required.  This strategy should define the vision, the skills and resources needed to achieve the goals outlined in the vision, the reasons why the change must take place, and an action plan.

Let risk and issues drive priority through the improvement cycle

With the strategy in place, the organisation should draft the data governance policies with high-level statements of intent relating to the functioning and management of data.  A useful approach is to first focus on the areas of difficulty or risk that the organisation is experiencing, and then to prioritise and evaluate the courses of action that will address these.

The workflows, data steward behaviours, and flow of data throughout an enterprise will have the most significant impact on data quality.  It is vital to understand and document the flow of data, and any processes that act on data.  Detailed system architecture diagrams enrich the understanding of workflows.

With an understanding of the workflows, business domains and processes that act on data, the Data Governance Lead is able to identify the key stewardship roles, including the operational data stewards and data owners.

Only now do we recommend starting to work with the data itself. It is important to understand what the primary sources of Master Data are, and how that data is impacted. Governance controls are essential to ensure the quality of data when enrichment has taken place – through external sources, derived data, or manually modified data.

The Governance Lead or governance working group can now begin to analyse the system and processes to address threats or weaknesses; capitalise on opportunities; or leverage strengths within the existing processes.

Implement governance controls

The following processes and controls should be considered to improve the quality of data and processes:

  • Data Management Interfaces – Facilities for the management of data need to be understood and reviewed.
  • Approvals – Clear accountability is vital to the approval process. Visual representations of data through reports or dashboards enable the accountable user to quickly confirm the data quality.
  • Issue Escalation and Resolution – If a data steward becomes aware of data or process risk, they must be able to reliably log the error for investigation and resolution, or for escalation.
  • Logging – Not having a record of how or who made the modification to data undermines any efforts to improve the data and related processes.
  • Decision logic and controls – Workflows by their nature may have conditionality, divergence and convergence, and decision points.  The implementation of governance controls will result in additional control points in order to evaluate outcomes and state, or to facilitate manual intervention.
  • Automated Reporting – Automated reporting can be an exceptionally effective tool to monitor system states and inform the governance team about risk events.
  • Data Matrices and Data profiles – Data Matrices are invaluable references when analysing data for subject areas, business domains, imports and exports.  Data profiles add to this additional detail relating to the context of the data.

Plan, do, refine, repeat

After each iteration or at defined intervals, key lessons are noted and refinements made.  This constant feedback loop will allow for quick wins, and ensure that the data governance programme considers organisational changes and remains aligned with stakeholder expectations.

The case for a dedicated investment compliance system

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By Jenine Ellappen – Compliance Product Manager at Infovest

Consolidation is often perceived as a positive goal. Software companies are continuously making acquisitions and trying to merge products and services to create an ‘all-inclusive’ package. Is this dream really possible though? Is it feasible for one solution to be the best at everything? The investment industry is enormous and has many components including portfolio management, performance, risk and compliance to name a few. For a single product to master all of these requires extreme flexibility, domain expertise and a well-designed architecture. Therefore the question is: given the choice, should one choose an all-in-one solution or a specialised product?

In investment compliance, this choice gives rise to heated debate between the business and compliance teams. While integrated order management systems seem to offer an all-in-one solution, which includes pre and post trade compliance, there are certain limitations on the post trade functionality resulting from the fact that the system was not specifically designed for post trade compliance.  Consequently, there are many arguments to support the case for a dedicated investment compliance system.

One of the main reasons that compliance teams need a dedicated compliance system is to allow them to have compliance centric data which is independent from other business units.

Data is vast and in every organisation the instrument universe, data attributes and data needs are constantly growing and evolving. In addition, compliance regulation is also evolving and becoming ever more demanding.

There are various regulations and investment policies in place to protect investors. These stipulate investment restrictions across various data attributes such as asset type, sector, country and issuer. The difficulty is not in obtaining data but in obtaining clean and consistent data. A prime example is finding clean issuer data as there is no international naming convention. If a fund has exposure to an issuer named ‘US Treasury N/B’ and another issuer named ‘US Treasury FRN’ the system will identify them as different issuers, not aggregate the exposures and as a result potentially not report a valid breach. This is a major risk. In addition compliance may require additional data on unlisted instruments or alternative asset type classifications. Certain regulations refer to the term ‘transferable securities’ instead of ‘bonds’ or ‘equities’. With a compliance centric database, the compliance team is able to clean, classify and supplement data without being concerned about the impact on other business units.

Investment compliance rules can be complex and a flexible rule builder is essential. While many systems have rule templates it is never the case that one size fits all.

Best of breed systems have a combination of templates and base rule components, such as calculators and aggregators, to allow the compliance team to create their own custom rules via a rule wizard. This provides them with flexible tools and insight into the detail of the rule calculation. It also empowers the compliance team to take full ownership of their rulebooks.

Consider the Undertakings for Collective Investment in Transferable Securities (UCITS) Directive which provides investment guidelines for Collective Investment Schemes (also known as Mutual Funds) which has the 5/10/40 rule that restricts investments in transferable securities or money market instruments issued by the same body to 5%. This 5% is however raised to 10% provided that the sum of all exposures greater than 5% is less than 40%. This rule may appear to be simple but it actually requires conditional logic and a mix of aggregators. In South Africa the Collective Investment Schemes Control Act (CISCA) Board Notice 52: Determination on the Requirements for Hedge Funds has a similar rule.  This complexity demonstrates the importance of having a flexible rule building platform.

Breach management is also a significant component of any compliance system. Once compliance breaches are identified by the system the compliance team require tools to investigate and manage these breaches.

Breaches may occur for a host of different reasons such as market value movements, cash investments or disinvestments, purchases or sales of instruments or portfolio transitioning. The compliance team may choose to take different approaches depending on the underlying cause of the breach. In most cases though, the portfolio manager will need to be contacted with the details and calculation of the breach.

This communication should be executed from the compliance system and all comments should be saved for auditing purposes. Should a fund incur major losses and the regulator looks for those accountable, the compliance team needs to have the fund compliance history and comments at their disposal.

The system should also be able to automatically send daily compliance reports and escalation emails. If a breach age exceeds a certain number of days the system should highlight this by sending a notification to the compliance users, risk manager and portfolio manager.

In summary, to operate effectively, the compliance team requires a dedicated investment compliance system with all the necessary tools to fulfil their mandate. They need a system that provides them with compliance centric data, a flexible and simple rule wizard, sophisticated breach management and automated reporting. To settle for anything less will compromise compliance capability with far-reaching consequences for investors and the firm itself.

StatPro Group PLC – Solid growth in revenue and profit

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StatPro Group PLC

Solid growth in revenue and profit

StatPro Group plc, (AIM: SOG, “StatPro”, “the Group”), the leading provider of portfolio analysis and asset pricing services for the global asset management industry, has published its interim results for the six months ended 30 June 2018.

Six months ended 30 June 2018 Six months ended 30 June 2017       Restated (3) % change % change at constant currency
Revenue £27.24 m £22.41 m +22% +24%
Annualised Recurring Revenue (“ARR”) (1) £52.25 m £53.19 m (2%) 0%
Adjusted EBITDA (2) £4.34 m £3.53 m +23% +27%
Profit/(loss) before tax £0.90 m £(1.54) m
Earnings/(loss) per share – basic  1.1p  (2.4)p
Earnings per share – adjusted (2) 3.4p 2.7p +26%
Interim dividend per share 0.85p 0.85p

FINANCIAL HIGHLIGHTS:

  • Group revenue up 22% to £27.24 million (2017: £22.41 million)
    • Organic growth 3% (2017: 2%)
    • Currency impact down 2% (2017: up 11%)
  • Adjusted EBITDA increased by 23% to £4.34 million (2017: £3.53 million)
  • Profit before tax £0.90 million (2017: loss £1.54 million)
  • Interim dividend maintained at 0.85 pence per share
  • Free cash flow in H1 2018 £2.19 million (2017: £3.52 million)

OPERATING HIGHLIGHTS:

  • StatPro Revolution underlying ARR growth of 19% (4) (2017: 9%)
  • Software as a service (SaaS) as a percentage of software ARR now 84% (2017: 82%)
  • StatPro Revolution Fixed Income Attribution (FIA) beta launched – key module seeing considerable demand. First step towards achieving parity with Delta
  • Integration of Delta progressing well
  • Acquired in July 2018 ODDO BHF’s regulatory risk services bureau – adds managed regulatory risk services offering

(1) Annualised Recurring Revenue is the annual value of revenue contractually committed at period end.
(2) Adjusted EBITDA and adjusted earnings/losses per share are EBITDA and earnings/losses per share after adjustment for amortisation of acquired intangible assets, acquisition transaction, redundancy and other integration costs, fair value movement on non-controlling interest put option and share based payments (notes 2 and 5).
(3) The interim and full year accounts for 2017 have been restated to take into account the adoption of IFRS 15 (see notes 1 and 3).
(4) Underlying ARR growth relates to Revolution excluding the acquired revenues from Delta and Investor Analytics and including conversions from Seven (see note 3).

Justin Wheatley, Chief Executive of StatPro, commented:

“We are pleased with the solid growth in Group revenue and profits in the first half. In particular, Revolution’s underlying Annualised Recurring Revenue grew by 19%.

“The project to integrate Delta’s functionality into our flagship product, Revolution, is going well. The launch of Revolution Fixed Income Attribution in July is the first step towards achieving functionality parity with Delta.

“In preparation for the planned restructure of the business into three divisions, we have appointed a new divisional CEO to lead and develop Source: StatPro, our data division.  This division leverages our access to huge quantities of data covering global equities, bonds and other data such as global mutual fund information.

“In 2018 and beyond, we anticipate strong growth in specialised managed services for regulations, risk and performance. We are focused upon building our partnerships with Asset Service Providers to broaden the services they offer the asset management community.”

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014 (MAR).

A presentation for analysts of the interim results will be held at 9.30am today at the offices of Instinctif Partners, 65 Gresham Street, London, EC2V 7NQ.

Enquiries

StatPro Group plc
Justin Wheatley, Chief Executive +44 (0) 20 8410 9876
Andrew Fabian, Finance Director
Panmure Gordon – Nomad and Broker
Corporate Finance – Freddy Crossley / Fabien Holler +44 (0) 20 7886 2500
Corporate Broking – James Stearns
Instinctif Partners
Adrian Duffield / Chris Birt +44 (0) 20 7457 2020

About StatPro

StatPro is a global provider of award winning portfolio analytics solutions for the investment community. The Group’s cloud-based platform provides vital analysis of portfolio performance, attribution, risk and compliance. This multi-asset class analytics platform helps StatPro’s clients increase assets under management, improve client service, meet tough regulations and reduce costs.

The Group’s integrated and global data coverage includes over 3.2 million securities such as equities, bonds, mutual funds, FX rates, futures, options, OTCs, sector classifications and much else besides. StatPro also covers most families of benchmarks including MSCI, FTSE, Russell, NASDAQ and the open source Freedom Index.

The Group has operations in Europe, North America, South Africa and Australia, with hundreds of clients in 39 countries around the world.

StatPro has grown its Annualised Recurring Revenue from less than £1 million in 1999 to around £54 million today. Around 80% of recurring revenues are generated outside the UK. StatPro Group plc shares are listed on AIM.

Our full 2018 interim results can be found here.

Acquisition of remaining shareholding in Infovest Consulting by StatPro Group PLC for £1.9m

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StatPro Group plc (AIM: SOG, “StatPro”, “the Group”), the AIM listed provider of cloud-based portfolio analysis and asset pricing services for the global asset management industry, has acquired the remaining shareholding in Infovest Consulting (Pty) Ltd (“Infovest”), a South African headquartered software provider, specialising in data warehouse, ETL and reporting software for the asset management industry.  StatPro previously had a 72.7% holding.

The consideration for the remaining 27.3% shareholding was ZAR 30.4 million (£1.9 million) in cash.

The increase in shareholding is expected to be earnings enhancing in the current year and the Group will further benefit from Infovest’s growing revenues and profits. The valuation of this buy-out is based on a formula linked to recurring revenue but with a minimum profit level. The multiple is just over six times EBITDA.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014 (MAR).

 

Enquiries:

StatPro Group plc
Justin Wheatley, Chief Executive +44 (0) 20 8410 9876
Andrew Fabian, Finance Director
Panmure Gordon – Nomad and Broker
Corporate Finance – Freddy Crossley / Fabien Holler +44 (0) 20 7886 2500
Corporate Broking – Tom Salvesen / James Stearns
Instinctif Partners
Adrian Duffield / Chris Birt +44 (0) 20 7457 2020

 

About StatPro

StatPro is a global provider of award winning portfolio analytics solutions for the investment community. The Group’s cloud-based platform provides vital analysis of portfolio performance, attribution, risk and compliance. This multi-asset class analytics platform helps StatPro’s clients increase assets under management, improve client service, meet tough regulations and reduce costs.

The Group’s integrated and global data coverage includes over 3.2 million securities such as equities, bonds, mutual funds, FX rates, futures, options, OTCs, sector classifications and much else besides. StatPro also covers most families of benchmarks including MSCI, FTSE, Russell, NASDAQ and the open source Freedom Index.

The Group has operations in Europe, North America, South Africa, Asia and Australia, with hundreds of clients in 39 countries around the world.

StatPro has grown its Annualised Recurring Revenue from less than £1 million in 1999 to around £53 million at the end of December 2017. Over 75% of recurring revenues are generated outside the UK. StatPro Group plc shares are listed on AIM.

Executive team changes for Infovest Consulting South Africa

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Cape Town – 2 February 2018

I am pleased to announce certain key changes and strategic appointments at Infovest Consulting South Africa, which are effective from 1 January 2018.

I have been appointed as Chief Executive Officer and will be working closely with the new Executive Team in the day to day delivery of solutions and service to our valued clients.

The additional appointments and changes to the Executive Team are as follows:

  • Ian Rivett has been appointed as Chief Operating Officer. Ian initially joined the business to head up the Project Office, however the intention was always to migrate him into a position of greater strategic responsibility within Infovest. Robin’s tragic passing has fast-tracked that promotion, and we are very glad to have Ian on the Executive Team. He will be responsible for the day to day operations of the business.
  • Jenny Donaldson has been appointed as Client Services Director, fulfilling a key role in making sure that you, the client, are cared for in a manner to which you are accustomed. Jenny will continue working closely with Infovest’s Business Solutions Team, ensuring the continual delivery of value added solutions and exceptional service.
  • Riaan Kirchner is moving from an Operations Director position to being the Chief Technology Officer for the business. His strong technical focus and dedication will ensure that the Infovest product set remains strategically positioned and defined as the business continues to morph and grow aggressively.

I am tremendously excited about these changes, and the opportunity to unlock the huge potential that Infovest has both in the South African and international markets.

Please feel free to contact me should you require any additional information.

 

Craig Arenhold
Chief Executive Officer

 

Atlantic Fund Services Selects Infovest for Post Trade Compliance

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Boston, MA (March, 2016)
Infovest Consulting (Pty) Ltd, a member of the StatPro Group of Companies, provider of investment data management, compliance, regulatory and client reporting solutions, today announced that Atlantic Fund Services, a leading, independent New England based fund administrator, will transition to Infovest post trade compliance software.

Atlantic Fund Services selected Infovest’s compliance solution to enhance their third party fund administration compliance offering with dynamic monitoring and client reporting . It is increasingly important that investment managers and fund service providers facilitate regulatory compliance programs effectively and efficiently. Infovest’s compliance solution is focused exclusively on the post trade domain and delivers comprehensive functionality in a solution that is easy to use and scale.

Chris Koons, Atlantic Fund Services’ Chief Operating Officer said, “We continuously evaluate our operations and technology to ensure we employ solutions that enhance our clients’ service experience. Infovest’s capabilities, including a user friendly rules builder, comprehensive breach monitoring , and turnkey management and client communications functionality, will increase efficiency in our daily workflow.” Mr. Koons added, “Infovest’s organization aligns well with our culture of high quality and highly responsive service.”

Simon Stillwell, Managing Director of Infovest U.S.A. commented, “We are delighted to be working with Atlantic Fund Services and to win another highly respected North American client. The fund administration space is highly competitive and by focusing exclusively on post trade compliance, we can deliver a solution that provides real value and flexibility to our clients. In turn this allows them to differentiate themselves by offering a state of the art service to their clients.”

About Atlantic Fund Services

Atlantic Fund Services is an independent, third-party administrator providing comprehensive fund servicing solutions for mutual funds, series trusts, closed-end funds, private funds and bank funds. Atlantic provides fund launch management, legal and regulatory administration, fund accounting and tax recordkeeping, performance reporting, financial reporting, transfer agency, shareholder services, and compliance services. Headquartered in Portland, Maine, Atlantic’s experienced professionals have provided high quality, customized services for over 30 years. For more information, please visit atlanticfundservices.com.

Contact: Chris Koons at +1 (207) 347 2012 or chris.koons@atlanticfundservices.com

About Infovest

Infovest is an international software business specializing in solutions for the buy-side and asset service providers alike. Our suite of products encompasses post trade compliance, Investment Data Management, client reporting, and regulatory reporting solutions for today’s investment companies. Infovest aims to reduce the cost of systems ownership and complexity with a flexible data management framework and a tried and tested methodology, all backed by an agile and experienced team of professional consultants. With offices in Boston, Cape Town, London and Sydney, Infovest helps their clients meet their continually evolving requirements.

Contact: Simon Stillwell on +1 (617) 401 5935 or simons@infovestusa.com

Download Press Release (PDF)

Infovest signs extended contract with Canadian Asset Manager in the highly competitive data management arena

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Boston, MA – 11 October 2016
Infovest Consulting (Pty) Ltd, part of the StatPro Group of Companies, a provider of investment data management, compliance, regulatory and client reporting solutions, today announced the signing of a long-term contract with Canadian asset manager, Triasima Portfolio Management. This is an impressive win for Infovest in its first year of North American operation.

Triasima will be utilizing Infovest’s investment data management and client reporting systems. Like most asset managers today, Triasima has a heterogeneous systems environment. By deploying Infovest’s leading-edge solution, Triasima will be better able to leverage their comprehensive systems and the data and information within them to improve their internal and external reporting. They will gain real value from their data whilst providing an integrated solution fundamental to their expanding business.

Senior Director of Operations at Triasima, Marc Dansereau, said, “After a rigorous selection process and detailed evaluation, we chose Infovest because of their efficient, flexible and very comprehensive data management and reporting capabilities. We are excited to partner with Infovest who clearly understand the importance of delivering a tailored integrated solution for Triasima.”

Simon Stillwell, Managing Director of Infovest’s North American operation explained, “We are delighted to have won Triasima’s business. It is a validation of our unique approach as Triasima see the tremendous benefit of using our best practice data model in combination with our easy to use toolkits that give them control. Our approach and systems architecture enables Triasima to satisfy not just today’s need but provides them a strong platform for future growth.”

About Triasima

Triasima Portfolio Management is a Canadian investment management firm known for its unique Three-Pillar Approach, which combines fundamental, quantitative, and trend analysis in a rigorous, yet innovative, investment process that remains consistent under all market conditions. With a successful performance track record since 1998, the firm serves a group of more than 250 institutional, sub-advisory, and individual clients. Today, Triasima has over $3.4 billion in assets under management. It is wholly owned by its employees and directors, and is completely independent from any other company or organization.

Contact: Mathieu Tanguay on +1 (514) 906 0667 ext 230. mtanguay@triasima.com

About Infovest

Infovest is an international software business specializing in solutions for the buy-side and asset service providers alike. Our suite of products encompasses post trade compliance, Investment Data Management, client reporting, and regulatory reporting solutions for today’s investment companies. Infovest aims to reduce the cost of systems ownership, reduce complexity with a flexible data management framework and a tried and tested methodology, all backed by an agile and experienced team of professional consultants. They help clients to bridge the gap between their business and their valuable data resources. With offices in Boston, Cape Town, London and Sydney, Infovest leverages clients’ existing expertise and IT investments in order to help them meet continually evolving requirements, whether through growth or regulation.

Contact: Simon Stillwell on +1 (617) 401 5935. simons@infovestusa.com

Download Press Release (PDF)

Infovest acquires StatPro Portfolio Control

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February 2016
I am pleased to announce that Infovest has fully acquired StatPro Portfolio Control (“SPC”) from StatPro. As part of the transaction, StatPro has in turn acquired a controlling interest in Infovest Consulting (Pty) Ltd.

Infovest has been providing client services for SPC since November 2013 through an outsourcing agreement with StatPro. Friday’s announcement enables Infovest to further invest in the product development and in the Compliance Centre of Excellence, headed up by Jenine Ellappen in Cape Town. The immediate benefits for SPC clients will be improvements in system performance and a significant investment in the product longevity, together with an increase in the client services team.

Jenny Donaldson, Vicki van der Westhuizen and I have all previously worked at StatPro and our direct management involvement in SPC enables us to increase the team size rapidly. In addition, we have a wealth of experience in building compliance related solutions for Infovest clients using Infostore’s investment data management capabilities. This means that we can develop a multi-talented Compliance unit at Infovest with a passion for assisting new and existing clients with their regulatory responsibilities (from compliance monitoring to regulatory reporting, using a combination of SPC and Infostore reporting solutions).

Infovest’s industry leading Investment Data Management solution is a valuable proposition to the global StatPro client base who all face significant data management and integration challenges. Infovest will leverage off of StatPro’s global client base and comprehensive international infrastructure to support its international growth strategy. This follows on from the new Infovest offices that were opened recently in Sydney, London and Boston.

Although Infovest is now part of the StatPro Group, we will operate independently with specific focus on Investment Data Management and compliance.

“This transaction provides a fantastic platform for Infovest to expand rapidly into new markets and territories in partnership with StatPro. We have already built a strong relationship with StatPro around SPC and believe that we can capitalise further on this relationship in the Investment Data Management and Compliance reporting space in support of StatPro’s core Revolution strategy.”

Robin Kemper
Managing Director Infovest

More information
StatPro: StatPro acquires 51% of InfoVest
StatPro: Acquisition of Majority Shareholding in South African InfoVest Consulting

Infovest opens North American office

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Infovest continues to fuel its global expansion through the opening of an office in Boston headed up by Simon Stillwell, formerly SVP Sales for StatPro Inc. Simon opened StatPro’s Boston office in 2008.

This exciting step follows on from the successful opening of the Infovest Europe office earlier in 2015.

Simon commented “I am extremely pleased to represent Infovest and to have the opportunity to build another great team here in Boston. I am confident that the blend of Infovest’s unique proposition of providing clients with the control and flexibility with scalable, efficient software solutions will appeal to many buyers in North America.”

Simon can be reached on +1 617 401 5935 or at simons@infovestusa.com

Infovest opens European Office

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Infovest is excited to announce the launch of its European office.
Simon Johns, Former COO of Statpro Group PLC will be heading up the newly opened London-based office.
This is a significant milestone for Infovest as it marks the company’s first permanent presence in the Northern hemisphere after successfully managing UK implementations from South Africa.
Simon Johns has 25 years’ experience working in the financial technology industry.
Simon has the ideal experience to launch Infovest’s investment data products into the European Market.
He has worked in London, New York and Switzerland, carried out 12 company acquisitions and has SME experience ranging from start-up through to LSE listed PLC. As a Company Director since 1997, Simon’s roles have included Client Services Director, Chief Operating Officer, Chief Executive Officer, EMEA and Asia Pacific for AIM listed StatPro Group PLC. Simon is also a non-executive Director of Gatestreet Ltd., which unites investment capital with businesses and projects across sub-Saharan Africa.