Des O'Donohue: Hi, everyone. Welcome back to Fund Recs HQ. And today I have Mr Nabil McNaughton from Azon Recruitment. How are you Nabil?
Nabil McNaughton: Des, I'm good. How are you?
Des O'Donohue: I'm very well.
Nabil McNaughton: Great.
Des O'Donohue: Tell us a bit about Azon.
Nabil McNaughton: Well, Azon is a recruitment business. We set up in the middle of 2014. So we're just three and a half years young now. We've got about 25 staff, I think, at the last count. And that's split across a number of different divisions or verticals. My area is financial services and that encompasses everything from funds, asset management, insurance, banking, capital markets, aircraft leasing, etc. We also have then, kind of on the other side, we have construction, accounting and finance, tax and legal, etc.
Des O'Donohue: You cover everything there, pretty much.
Nabil McNaughton: Everything. Yeah.
Des O'Donohue: And you guys are based in Dublin or?
Nabil McNaughton: We are. Yeah, we are. We're based in Merrion Square, but we also have offices down in Limerick as well.
Des O'Donohue: Ok, cool. So what are you guys seeing in the fund space, for example? What's going on at the moment?
Nabil McNaughton: Well, look it's a really good time, and not to poach phrases from the Adminovate Conference but... Look, it's just a really interesting time now. There's a lot of stuff going on, as you know Des. It's not your stereotypical kind of five, ten years ago where it was purely full administration, and it was operations, and it was fund accounting, TA, and a bit of compliance and custody. It's now evolved a lot more. You have your fund administrators, but even the work within there is different. A lot of the stuff is maybe offshored, and a lot of the work there now is more oversight or client-centric product type stuff as well.
Nabil McNaughton: But on top of the fund administration piece now, obviously we have a lot of ManCos that have spread up governance businesses, off the back of all the regulation that's come post-crisis 2008. We have asset managers here and it was always a couple of asset managers, there's a few more now. A few smaller ones setting up as well, the European operation. And a lot more of that is going to happen now as a result of Brexit as you know.
Nabil McNaughton: Then we have our advisory consultant firms, and they are going at a very, very lively pace in terms of just taking on a lot of work from the financial services industry. It's a really interesting place to go. And then, as well, we have FinTech firms like yourselves, and that's bringing a lot.
Des O'Donohue: I just want to ask you that, because I started out in fund administration myself, quite a few years ago.
Nabil McNaughton: Many moons ago.
Des O'Donohue: Many moons ago. It was very straight-laced in terms of the job descriptions, or whatever. Is that evolving? And do you see that involvement in line with the likes of the FinTechs where they're looking for people that are more niche for certain areas specifically?
Nabil McNaughton: Yeah, It's a good question. So I think look, I used to be a fund accountant when I came out of college right.
Des O'Donohue: We got to call ourselves recovering fund accountants.
Nabil McNaughton: That's it. Yeah. But, no. I did for a few years. And look, I think that fund accounting will always be there and its guise and you have to produce a NAV and that's it, right? But I think that probably what's happened is the role of fund accountant is similar in a lot of ways. But what's probably changed is just how a lot of the firms are structured. A lot of their operations are offshore now. A lot of firms, the heavy lifting as people like to call it, are done in your other centres.
Des O'Donohue: So it's more oversight?
Nabil McNaughton: It's more oversight, it's more client-centric. So individuals now, as opposed to understanding what an NAV entails and all the various kinds of aspects to it, they need to be good with clients. They need to be good with people. They need to be able to discuss a NAV or an error with clients and with internal departments. But also on top of that, it's all about now having good knowledge of the regulations that impact it. And then being up to speed with the various systems and processes that are in the business.
Des O'Donohue: Yeah I mean compliance at the moment MiFID and all, the GDPR, all of those death by acronym things. And I would imagine you're inundated with queries from companies looking for people that have those particular skillsets.
Nabil McNaughton: Yeah. Well no look, so I mean like even the last number of months, MiFID type compliance work has soared. So a lot of firms are now beefing up their MiFID compliance. GDPR, again, we were having a conversation about that yesterday, and that is a huge area now of demand. A bit like when AFMD came onto the scene a number of years ago, nobody really had a clue what essentially it was, right?
Nabil McNaughton: So we don't have a lot of people now that are GDPR experts because it never existed. So it's now getting people to... Again, and it's all about this adaptability, Des, where people have a good knowledge of regs maybe, and they're able to interpret it, and action regulations and described regulations. But now they need to kind of switch that towards GDPR.
Des O'Donohue: I think even on the likes of GDPR, and regs in general... I think that is definitely where RegTech and the FinTechs are coming into their own. And, I'll namecheck one, Emerald de Leeuw. She is certainly a GDPR expert. So Emerald is someone that people are now going to. A few years ago they would have gone with, I suppose the traditional compliance and the right people.
Nabil McNaughton: No, absolutely. And like even just, going back to that brilliant conference that you guys set up. Just to see it is as easy as that, well it's not easy but you know, these days now it is quite an entrepreneurial kind of innovative type of society. It's like you can't get a really good person who understands fund accounting and understands funds. If you put them together with someone that's a developer and understands the tech piece, you know, all of a sudden you can make something happen there. As per a lot of the speakers were saying, find that one area that's not being necessarily looked at yet, or where's that little gap in the market? And if you can put a service together that solves a problem, you're in.
Des O'Donohue: You're basically telling the Fund Recs story there.
Nabil McNaughton: Yeah, exactly.
Des O'Donohue: That's where we came out. We had a very unhealthy advantage in that order, very healthy for us advantage in that we had operations people, and then we were able to marry operations people with developers. And it's a perfect storm, really. At Fund Recs we're not salespeople, we're ops guys. So, yeah. So I actually, and even on that, even the FinTechs that I've seen around town, most of those, the founders are actually they're operations people.
Nabil McNaughton: They're operations people, yeah. And that's it. So I think, and again, like you guys are a perfect example. But that's hopefully you guys have given people that maybe the confidence or the hope they can kind of do that and set that up as well. Like going back to one of the comments at the conference, I think it was Geraldine from AQMetrics said, look, our companies are very strong out there. They've got very good expertise, better than most, but they just need to be given the chance in terms of, you know given the opportunity to set up as well.
Des O'Donohue: That's very true. So what are you seeing for, again where to start, 2018? What are you seeing coming down the pipeline in terms of what people are looking for? Like at the moment what are they looking for? We mentioned reg people, what else?
Nabil McNaughton: So I think 2019 is going to be, it's going to be very busy. I think that across all areas we discussed earlier on. I think there's always going to be a need for a good strong fund accountant. There's always going to be a need for somebody in TA, and there's always going to be a need for somebody who can price securities for somebody who's got compliance on AML and understands regulations. But I think that's going to be consistent enough. I think the raft of regulations that is changing the dynamics a bit. So I think probably where we're going to see this, the fund administrators will be very busy, but you're going to see good people maybe within fund administration, maybe looking at other opportunities as well that present themselves. And that could be in an advisory forum for example, where they're using their knowledge of funds, they're using their knowledge of operations, and they're going there and some type of consulting capacity where they're able to advise other businesses what they've been through and the pain points that they'd been through, what they've seen.
Des O'Donohue: Yeah. Very good. One last question. I said that was the last question, but I lied. Do you see that the bigger players are starting to try to build stuff for themselves or they are looking for a specialist.
Nabil McNaughton: Yeah.
Des O'Donohue: Or do you think they're looking to outsource or what do you think?
Nabil McNaughton: It's a good question Des. I think it's a bit of both. I speak to candidates all the time who maybe have been set up for example, might've set up internally the regulatory reporting function. And again, that marries a lot of technology with regulation. How do you get something done? Do it. Do it effectively. Do it efficiently. That you can give to your client as a value add service and do it yourself and make revenue from it.
Nabil McNaughton: Then others say look, let's focus on what we're good at. Let's focus on what we can actually make money out of and outsource it to the experts. You know, be it reconciliations like yourselves or whatever it is.
Des O'Donohue: Or whatever it is.
Nabil McNaughton: Yeah.
Des O'Donohue: Very good. It's been an absolute pleasure having you in.
Nabil McNaughton: Great to be here.
Des O'Donohue: Much appreciate it.
Nabil McNaughton: All right. Yep. Cheers.