Private Wealth Systems: Solving the Structural Data Challenges

Private Wealth Systems: Solving the Structural Data Challenges

Private Wealth Systems caught our attention because of the impact they are having in the global family office market, and their unique focus on providing the infrastructure as well as the interface that will fundamentally affect the financial services industry for decades to come. Private Wealth Systems is the only company in its segment that has the support of three of the top global private banks with clients in six countries. With such an experienced team, no wonder they have been able to demonstrate how they are unique in solving the structural issues of supporting the most complex investment portfolios around the world for many of the most sophisticated family offices and private banks.

Private Wealth Systems’ cloud-based platform provides multi-asset, multi-currency, multi-custodial portfolio accounting, portfolio management, and consolidated investment reporting to family offices, UHNWIs, private banks, and institutional asset managers. “Our platform supports two to three times the number of transaction codes of other systems, allowing us to capture, correct, calculate, and present more data, faster, more accurately, at a lower total cost – delivering on the industry promise of operational scale across the most complex portfolios,” says Craig Pearson, Co-founder, CFO, and CEO of Private Wealth Systems. However, unlike the vast majority of financial platforms that simply pass through data directly from custodial bank feeds, Private Wealth Systems understands data accuracy is of equal importance to data comprehensiveness, and provides daily multi-tiered reconciliation to capture and correct data errors from custodial banks before the data gets to the clients. Pearson adds, “Most people are surprised when they learn the level of errors found in daily custodial feeds. Recently, one custodian incorrectly adjusted the cost on a client position by $22 million, another custodian misapplied the currency exchange rate on a large trade for one of their largest clients, and several custodians can only support position level information on complex securities. Our technology and processes are designed to capture and correct the data, fast and at-scale, so our clients can trust the data and have confidence in their decision making without the burden of large operations teams and latency in delayed decision making.”

When we dug further into the company’s unique capabilities we learned that a large multi-national family office hired one of the largest accounting firms to audit their data that was being processed by Private Wealth Systems. The four-month long transaction level audit proved the company systematically matches back to each system of record, not just the feed but the actual statement, and does so across multiple custodians and all major asset classes including derivatives and multi-currency transactions, as well as complex ownership structures. “The audit was quite intensive and demonstrated to the client that our technology and processes are truly different which is why we are having a meaningful impact on the global financial services industry,” says Pearson.

Our singular purpose is solving the structural issues of financial intelligence that continue to challenge the $32 trillion ultra-high net worth industry

When we inquired about future product development we learned the company is focusing on adding full general ledger accounting, trade order management, establishing a physical presence in Switzerland, and integrating enhanced cognitive computing. Pearson provides clarity by stating, “It’s always been about the data—what is the data telling you and what action do you want to take. Data must be tax level accurate, comprehensive enough to cover all aspects, and timely enough to be actionable. The first evolution of our platform was focused on capturing as much relevant data as possible from fragmented silos of information across global banks and ensuring data accuracy with hyper-efficient scale. The second evolution is around personalized analytics and understanding what the data is telling each stakeholder in terms of risk, return, income, and expense. Keep in mind we support very complex esoteric instruments, so instead of hiring a team of analysts that will take days or weeks to analyze data, our system will be able to provide actional intelligence in real time regardless of financial instrument or global jurisdiction. The third evolution will allow users to take action based on the information and analysis they have.”