SEI Acquires Altigo
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Insights
The acquisition of Altigo by SEI is a strategic move aimed at capitalizing on the growing demand for alternative investments among younger investors. This trend, coupled with projections that global alternative assets will reach $23 trillion by 2027, underscores the importance of technology in streamlining the investment process in this burgeoning market segment.
By integrating Altigo's e-subscription and reporting capabilities, SEI is positioning itself to offer a more efficient and accessible platform for private clients and financial intermediaries to invest in alternative assets. The Software-as-a-Service model mentioned is particularly noteworthy as it aligns with the broader industry shift towards digitalization and could lead to increased scalability and recurring revenue streams for SEI.
The long-term implications for SEI include potential market share growth in the alternatives space and enhanced competitive advantage through technological leadership. However, the success of this acquisition will depend on effective integration and the ability to meet the evolving needs of investors and financial professionals.
SEI's acquisition of Altigo reflects a broader industry trend where firms are leveraging technology to meet the increasing investor appetite for alternative investments. The significance lies in addressing the current barriers to entry in the alternatives market, which include complexity, exclusivity and manual management processes.
By offering a digital platform that simplifies these challenges, SEI is likely to attract a wider range of investors and financial intermediaries. The move also suggests an anticipated increase in the democratization of alternative investments, potentially reshaping the landscape of private fund investing.
However, challenges such as regulatory compliance, data security and platform adoption rates must be carefully managed. The expertise brought in by the Altigo team will be crucial in navigating these issues and ensuring that the platform meets the high standards required by the financial services industry.
The strategic acquisition of a cloud-based technology platform like Altigo by SEI signals the increasing intersection of finance and technology, particularly in the realm of alternative investments. The move underscores the critical role of technology in scaling operations and improving the user experience for investors and intermediaries.
SEI's approach to expand its tech stack through Altigo could enhance its overall value proposition by streamlining the investment process and offering a more comprehensive suite of services. The focus on a Software-as-a-Service (SaaS) model is particularly relevant as it suggests a commitment to continuous innovation and customer-centric solutions.
The anticipated benefits include operational efficiencies, improved speed of investment decisions and broader distribution capabilities. Nevertheless, the integration of Altigo's platform must be executed without disrupting existing services and while maintaining high levels of security and compliance.
SEI to Leverage Unique Industry Position to Meet Market Demand and
Streamline Investment Process for Alternatives
Ryan Hicke, SEI CEO, said:
"We sit at the center of the financial services industry, which positions us to connect all components of the ecosystem in a way that others can't. Our client footprint across financial intermediaries and fund sponsors—combined with the breadth of our capabilities across technology, operations, and asset management—gives us opportunities to transform private fund investing and widen access to alternative investment products for investors."
As part of the transaction, SEI will welcome Altigo team members who collectively bring technical, sales, client service, and marketing expertise. The company intends to provide the distribution of and access to a selection of alternative investment products in a Software-as-a-Service model to its existing investment manager, advisor, and banking clients in the first half of 2024. SEI is a market leader in supporting sponsor firms' operational and information needs, and the integration of Altigo with SEI's capabilities across intermediary wealth channels will enable the delivery of a broader, end-to-end solution.
Kevin Crowe, Senior Vice President at SEI, added:
"Investor expectations for a personalized wealth management experience continue to drive the demand for investment flexibility, and alternatives can play an important role in a diversified portfolio that meets an investor's financial goals—but access to alternative investments is largely exclusive. Financial intermediaries often seek guidance on how to source and utilize these products, the process to invest in these products can be complicated and slow, and ongoing management is typically manual. This platform is built on the idea that investing in alternative securities could be made much more efficient and manageable using online technology tools and digital workflows.
"By leveraging our unmatched position to connect fund sponsors to intermediaries and intermediaries to investment options that cater to their clients' goals, we believe we can enable distribution beyond today's access points, empower financial professionals to make faster, more confident investment decisions for their clients, and drive future growth."
1 Prequin, "2022 Global Alternatives Report"; 2 Prequin, "Future of Alts in 2027"
About SEI®
SEI (NASDAQ:SEIC) delivers technology and investment solutions that connect the financial services industry. With capabilities across investment processing, operations, and asset management, SEI works with corporations, financial institutions and professionals, and ultra-high-net-worth families to help drive growth, make confident decisions, and protect futures. As of Sept. 30, 2023, SEI manages, advises, or administers approximately
This release contains forward-looking statements within the meaning or the rules and regulations of the Securities and Exchange Commission. In some cases you can identify forward-looking statements by terminology, such as "may," "will," "expect," "believe," and "continue" or "appear." Our forward-looking statements include our current expectations as to:
- investor desire for access to a variety of high-quality alternative investment products,
- our ability to transform private fund investing and widen access to alternative investment products for investors,
- the solutions we will offer and the timing of such offerings,
- the drivers of investor demands for flexibility,
- the degree to which investing in alternative securities could be made much more efficient and manageable using online technology tools and digital workflows, and
- our ability to enable distribution beyond today's access points and empower financial professionals to make faster, more confident investment decisions for their clients and drive future growth.
You should not place undue reliance on our forward-looking statements, as they are based on the current beliefs and expectations of our management and subject to significant risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe the assumptions upon which we base our forward-looking statements are reasonable, they could be inaccurate. Some of the risks and important factors that could cause actual results to differ from those described in our forward-looking statements can be found in the "Risk Factors" section of our Annual Report on Form 10-K for the year ended Dec. 31, 2022, filed with the Securities and Exchange Commission.
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SOURCE SEI Investments Company
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