universal spotlight: Mr. Reinhard, in our last edition you said that Universal-Investment would like to become the leading European fund service platform for all asset classes by 2023. Where do you stand today?
Michael Reinhard: In Germany we are already the leading independent fund service platform. In order to become the European leader, we are focusing on our four strategic pillars: digital transformation, strategic growth, internationalisation and growth of our core business. Universal-Investment has been investing significantly into digitalisation each year in order to develop new service concepts for our clients and to improve our existing services. We have set up one of the first investment platforms for digital assets worldwide – UI Enlyte. Once the regulatory environment permits, we also plan to offer digital funds. Furthermore, we are looking at acquisitions to complement our services. In the past we made acquisitions such as UI labs, whose highly-specialised range of products include a portfolio management software that is offered as a service, and CAPinside, with its digital B2B platform that helps fund initiators and intermediaries connect with each other. With regards to internationalisation, our goal is to offer a point of presence in the leading European locations, i.e. in Germany as well as in Luxembourg and Ireland. Our reasoning is that Ireland is the preferred location for British and US fund initiators. Regardless of their size, German-based institutional investors and fund initiators will continue to remain our key client groups. We grow with our customers.
The year 2020 brought unforeseen challenges. How have your clients fared in the coronavirus pandemic?
Katja Müller: Together with our clients, we have so far fared well overall in the coronavirus pandemic. Our institutional investors reacted with caution in view of their longer-term 15- to 20-year investment horizons. Many of our fund initiators have proved their strength as active asset managers, performing remarkably well in terms of flows of funds - although there were certainly outflows at the beginning of the crisis.
What precautionary measures did Universal-Investment take internally with regards to the coronavirus pandemic?
Michael Reinhard: Our highest priority was to protect our employees and maintain our operative business. We were therefore active very early on, even before the first lockdown. The result was that almost all our employees had the option of working from home. We spread our employees over three locations: the IBC, a back-up site and “Home Office”. We also stayed true to our DNA as a platform provider in these challenging times: we remained a reliable partner by our clients’ side. Our business continuity plans worked out and our services continued to run largely in usual form for our clients. We have received a lot of positive feedback in return, which is highly motivating.
What experience have you gained on the client side in the crisis?
Katja Müller: The relationship with our clients has become even closer. The crisis has made us all very aware of the fact that investment solutions work best when they are well designed and well implemented. It is a great advantage if everything from structuring and risk management to administration and reporting operate hand in hand. Our thanks go out to all of those who, through their contribution, have helped us navigate these challenging times so well. Our thanks go in particular to our clients, with whom we have found pragmatic solutions.
Which services have been in high demand with your clients in this challenging phase?
Katja Müller: We are currently witnessing a sharp increase in demand for diversification in the asset classes, for example in alternative investments and real estate. This plays to our strengths as we have been developing our structuring and administration expertise for years. The combined range of services in the Portfolio Management Division is also more important than ever for our clients: overlay management, with its rule-based concepts, can help ensure a more dynamic management of risk budgets as well the absorption of portfolio drawdowns. Transition management, on the other hand, can help institutional investors carry out any necessary restructuring in a risk and cost-efficient way after the developments sparked by the crisis.
What trends are emerging among your customers?
Katja Müller: ESG is a significant trend for both our client groups - fund initiators and institutional investors - as well as for the company as a whole. We see ourselves as a platform “enabler” and plan to extend our services. Our offers in the private label sector and the technical support provided by our platform are decisive for fund initiators. We have also recognised that support in the field of sales and distribution has become increasingly important because our joint funds are the foundation of many of our partners’ businesses. We are very aware of this and act accordingly.
Which new services is Universal-Investment working on currently?
Katja Müller: We are constantly developing our private label offering. Our plan is to provide business start-ups and established investment funds with a platform for their investment strategies. We aim to offer an even better service than before by setting up a one-stop sales and distribution platform. Our acquisition of the online platform CAPinside was a step in this direction. In addition, we are also creating added value for our fund partners through cooperations such as, for example, our exclusive co-venture with Scope Analysis.
Michael Reinhard: We are also working on new or improved services in all our product areas. The three main topics include innovative vehicles (282 and InvKG), access to digital assets as well as future-oriented reporting solutions. For example, we are currently reorganising the reporting for our clients. With the help of clients feedback, we are setting up a new, more user friendly environment for the reporting platform PowerPortal. Our clients can look forward to these and other new client-centric services soon.
Date of issue: 4/1/2021
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