Des O'Donohoe: Hi, everyone. Des from Fund Recs. Today I have Bert Boerman from Governance.com. Welcome.
Bert Boerman: Great to be here. Thanks.
Des O'Donohoe: Okay, so what do you want to talk about?
Bert Boerman: I think we'll talk a little bit about what we try to do for our clients with Governance.com.
Des O'Donohoe: Okay, cool, let's go.
Bert Boerman: So maybe I'll introduce it to you.
Des O'Donohoe: Please.
Bert Boerman: So yeah, so we are a six-year-old company. We're based in Luxembourg. We have offices in Luxembourg and the Netherlands. And our aim is to help clients to organize unstructured data in the organization and give them back control over their internal processes.
Bert Boerman: So that's basically in a nutshell. So we started very niche in the investment fund business, specifically focusing on private equity real estate, because there's very complex structures. But gradually we branched out and we tried to do other things. So we started branching out to other parts of the asset management industry. And then we started getting clients even outside the financial sector, because at the end of the day, everybody's struggling with data overload.
Des O'Donohoe: Absolutely.
Bert Boerman: Exactly.
Des O'Donohoe: I suppose the question I'd have for you is, what was the driver for you to start the company? Because it is a big step. Was it, you were trying to solve a problem you had encountered yourself or you saw it elsewhere?
Bert Boerman: That's exactly it. So I was working for 15 years at ABN AMRO and I was totally frustrated with my oversight duties. So I had to have oversight over complex investment fund structures that were investing in assets which are not in our custody systems. And we had look-through responsibility, which means that we needed to control anything happening anywhere in the structure. But all this stuff was not in our system. It didn't fit in our core legacy system.
Des O'Donohoe: So what, have you been using Excel and all of those things to try and hack it?
Bert Boerman: Like everybody else. I didn't realize how big the usage of Excel was until I actually started looking to build a company around it. But initially, I just wanted my problem to go away. And I had actually already launched an app development business, which I decided to turn around and to build a system for myself just to help me in my day job.
Des O'Donohoe: Now you say yourself, but what's interesting about that, is you have a twin brother who is identical to you and he's your CTO?
Bert Boerman: Yeah. He's the CTO.
Des O'Donohoe: So that is amazing. I'm not saying amazing good luck, but it is an amazing thing, because we get asked all the time, number one piece of advice for a startup company. And I say, if it's a technology company, you need to have a founding member that's going to be your CTO, because you will be out of business trying to reiterate a product, and paying developers a day rate...
Bert Boerman: If you're lucky enough to have somebody in your family that you can launch a business and you can see eye to eye with, even in difficult situations, it's perfect.
Des O'Donohoe: Yeah.
Bert Boerman: And especially in our case, because we're twin brothers, so we need half a word and we already know what the other one is thinking. And so he is a specialist of technology with a technology background with a business interest, and I'm a specialist of the business with a technology interest. So that's the perfect match.
Des O'Donohoe: It's the perfect storm. Yeah. But it is the perfect storm.
Bert Boerman: Yeah.
Des O'Donohoe: Yeah. So when you were getting set up, what initially were the biggest challenges?
Bert Boerman: Initially I developed this for myself and so that fit my purpose. We actually got an inspection from the regulator. We got fantastic feedback. And that's the time where I started thinking, well, maybe other people need this as well. So I decided to leave the bank at a certain moment and to build it. And I thought, well, I know that people need this. There's a lot of studies out there. So I'll just build it. And also I looked at the market, easy-peasy, but it was not so easy, because first of all, when you don't have referenced clients, you don't have the balance sheet, it's quite difficult to get into the markets.
Bert Boerman: But also because the problem is when you build a solution too much on your own specific need, you don't cover a lot of other needs, which may fall in the same category, but which are slightly different. And so if you have a private equity fund manager, he's managing a different data set than a real estate fund manager. And even two real estate fund managers may have completely different data sets. And then if you start looking at wider assets or even outside the asset management industry, the data changes all the time.
Des O'Donohoe: How do you deal with that? So how do you deal with that issue that each client is unique and they've got different flows?
Bert Boerman: Yeah. So we basically had to redevelop the entire system three times. So that was quite painful.
Des O'Donohoe: Only three.
Bert Boerman: Only three times, but it was a major overhaul and it's the famous pivot, as we call it. So we tested with clients, we found out that it covered a need, but not entirely. We came to the realization that we really needed something which was completely flexible. And so what we did is we built a system where our clients can design their own dataset. So we were deploying on-premise or in private cloud environments-
Des O'Donohoe: So you cover both?
Bert Boerman: Yeah, yeah. Or we can do public cloud as well, but as an extension of what we are already doing on-premise.
Des O'Donohoe: Because that is where everybody ultimately is going to go. They are going to go cloud for a couple of reasons. Cost is one thing that will ultimately help that decision move along.
Bert Boerman: Yeah.
Des O'Donohoe: Very good. And in Luxembourg, the cloud thing, is it as much an issue as it would have been in the past? Is that lessening?
Bert Boerman: It's lessening. So we now have a cloud circular in Luxembourg, which allows you to store information in the cloud, but with GDPR coming and with other data privacy requirements, you need to choose your cloud very carefully. So you need to do your due diligence on the third party, which again, we could even facilitate with Governance itself, because we perform due diligence on third parties. Our clients do.
Bert Boerman: But maybe to get back to the data customization, that is not the core strength, because now we've built a partner network around us that can go into clients and can say, "Okay, we're just implementing technology. It's not automatically going to make your problem go away."
Des O'Donohoe: Exactly.
Bert Boerman: So you do need to analyze your processes and to see, do we have data duplication in different systems? Which systems do you want to keep? So what we've done now is that you can push data from all your core legacy systems into Governance. You don't need to replace your legacy systems because they're there for a reason. They do one thing specifically very well. So keep that. Feed the information into Governance and then structure your workflows, your due diligence and your information sharing with your third-parties around that.
Bert Boerman: But you do need to have an expert that comes in and says, "Well, now you need to also organize your processes." And that was another thing that we didn't appreciate at the beginning, is that just throwing technology at a problem doesn't make your problem go away.
Des O'Donohoe: Yeah. For sure.
Bert Boerman: You need experts.
Des O'Donohoe: It's very true. It's very true. It's like people saying, "Well, we'll just introduce robotics." Robots need to be looked after as well. There's a lot of work that goes with that too.
Des O'Donohoe: One question before we finish up. What's the next thing for you guys this year, if you fast forward six months, a year, what's next for Governance?
Bert Boerman: What we're doing now is we are expanding our partner network very rapidly. So we're working with large and small consultancy firms that can help our clients with organizing the processes in Governance. So we're doing that now in about eight countries in Europe. The next big thing is that we're looking to open an office probably in Singapore or Hong Kong.
Des O'Donohoe: Singapore is a real hotbed at the moment, isn't it?
Bert Boerman: Yeah. And it's very dynamic. So I was there recently and they have big plans also for the fund industry. And New York. So we definitely want to have a foot on the ground in the US. That's why I think New York is the best place to be. And potentially London as well. So I don't think everybody will move out of London. So we do need to be there.
Des O'Donohoe: Yeah. You're going to be very busy. Bert, absolute pleasure having you. Cheers. Thank you.
Bert Boerman: Yeah, it was great. Thanks a lot.
Des O'Donohoe: Cheers.