Alexis Augier
On the most recent episode of the Guernsey Finance Podcast, host Brandon Ashplant spoke to Alexis Augier, founder and chief executive of Vega, an operating system and platform for private wealth.
Prior to starting Vega, Alexis was an investment professional at Elliott and KKR and started his career at Goldman Sachs. Here, he discusses the changing world of private wealth and the evolution of offerings to private clients.
Can you tell us a bit about Vega, how you started up the firm and some of its key aims?
My background is not in standard technology. This is a bit of a pivot, which was really driven by my experience when I was working at investment firms. I started seeing the gap between what I was used to in my day-to-day job in terms of sophistication, and what was available to me on a personal basis.
We wanted to build something that would be appealing to this new generation of high-net-worth individuals, people who are quite sophisticated financially, and demanding when it comes to the products they want to consume and the underlying user experience.
The underlying premise for Vega is how do we bring to a broader audience the same sophistication that's common in the institutional world. And we do that by mixing our backgrounds in the finance sector with very strong technical skills. Most of our team actually comes from Revolut, and we're trying to bring a bit of that user experience framework to the wealth management world.
How is Vega looking to harness opportunities and capitalise on the transfer of wealth from the older generations through to the emerging generation?
We see two core trends that we think are going to be reshaping wealth management for the years to come. Number one is demographics with the emergence of a new generation of high-net-worth individuals. And number two is a new asset allocation paradigm with alternatives and private markets becoming more and more important in people's portfolio allocation.
This new generation has very different expectations when it comes to user experience because we are digital natives. So, the standard way of delivering wealth management services, which tends to be offline, is important, but we believe a big chunk of the user experience will have to go digital.
If you think about the private world space right now, you really have two categories of companies, you have the digital disruptors, those direct-to-consumer digital advisers who are trying to build trust and a brand. On the other hand, you have the incumbents, the offline players, who are trying to digitise themselves.
We are taking the bet that we are better off equipping the latter category. So, helping those larger players who already have a brand and established trust to be attractive to this new generation of high-end wealth individuals by digitising themselves.
For us, it's not about only digitising the user experience, but also internal processes. Traditionally, the wealth management industry is very pen and paper in the way it operates. We think there's a tremendous opportunity to help those wealth managers truly digitise their operations and cut a lot of costs, which then can be passed on to the customers in terms of better fees, better services.
How are the next generation of industry leaders different to their predecessors in terms of their outlook and approach to wealth management?
I think they are embracing technology much more aggressively. There is a tremendous shortage of financial advisors, especially in the UK. And clearly, they’re going to have to shift to a new model where advisers can serve more clients to cope with the demand. So, we're seeing younger advisors be inclined to think about technology more strategically.
We think the winning model in wealth management is going to be a hybrid one, where you still have human interaction with your financial adviser who you can call for the complex topics, but the bulk of the experience will go digital. That will allow advisers to serve more clients in the end.
How is Vega enabling a broader participation of private wealth into alternative classes?
We see wealth managers as the gatekeepers here. So, our goal is not to build a direct-to-consumer proposition, but to equip those wealth managers so that they can access better products for underlying clients.
Private markets and alternatives are actively new in the product wealth space, and advisors still need to understand those products. What we're trying to do with our technology is to remove the hurdles for advisers to embrace those financial products.
And those hurdles are operational; if you are an adviser with 50 clients and they all have a couple of private markets funds, it quickly becomes hard for you as an adviser to handle that. So, we've digitised that whole journey to enable advisers to distribute private markets the same way they would do it for the public asset classes.
The other element on the private market side of things is we're building a whole suite of tools on analytics and portfolio management to enable advisers to mix those private markets products with traditional portfolios.
Vega has worked with Guernsey firms and the Guernsey Financial Services Commission, the regulator here on the island, on your launch. What benefits have you found working with these firms and our regulator here in Guernsey?
We thought long and hard about the jurisdiction we were going to be focused on and we ended up picking Guernsey really for a couple of reasons.
Number one is flexibility, and number two is speed of execution. When we were benchmarking different jurisdictions, it became very clear to us that Guernsey was frankly the fastest and the most inclined to embrace technology. So that was super important for us because in the end, what we're doing is not only about building technology, but it's also about convincing people to embrace our processes. So, you need to make sure you find the right partners for it.
We are super excited for our partnership with Guernsey.