Acuity Knowledge Partners is a global leader in research, analytics and technology solutions for global capital markets clients. They are doubling the size of the Colombo office to meet rising demand.
Digital transformations have expanded opportunities for global financial firms to leverage the benefits of external workforces for better workforce-related risk management, to be nimbler with strategy and for cost reduction. The growing dependence on external workforces accelerated after the pandemic when companies realised they could operate without disruption with remote teams.
Sri Lanka has emerged as a hidden gem for offshore-based workforces during the last decade or so and the industry is now experiencing a fresh growth spurt. Acuity Knowledge Partners is one of the leading Sri Lankan firms offering offshore teams and is a global leader in providing specialised research, analytics and technology solutions teams for the global capital markets, wider financial institutions and management consulting firms. Acuity Knowledge Partners (AKP) expects to double the headcount at its Colombo office with more analysts and data scientists to meet growing demand.
Acuity’s Managing Director of Investment Research and Sri Lanka Country Head, Chanakya Dissanayake, its Director, of Investment Research and Training Rathnakala Kumaragurunathan and Associate Director for Specialised Solutions, Rohan Fernando discussed Acuity Knowledge Partners’ value proposition for clients and how it has created a world-class workplace that offers a global perspective to its teams.
Chanakya Dissanayake
Managing Director/Country Head, Sri Lanka, Head of Investment Research
Chanakya Dissanayake leads the investment research at Acuity. In addition, Chanakya manages the Colombo delivery center that provides investment research, quant – data science, commercial lending and FMS services. The investment research team is responsible for the buy-side, sellside and private wealth management clientele that obtain equity and fixed income research from Acuity.
Rathnakala Kumaragurunathan
Director, Investment Research
Rathnakala Kumaragurunathan has over a decade’s experience in buy-side equity research. She oversees the buy side engagements at Acuity’s Colombo office. Rathnakala is experienced in setting up, scaling, and managing buy-side client engagements, in particular hedge fund accounts, and working closely with clients to meet their evolving needs and expectations.
Rohan Fernando
Associate Director, Specialised Solutions
Rohan started his career as a programmer and moved to Acuity over a decade ago. He leads data science teams that provide clients with alternative insights to complement their investment analysis.
“Sri lanka has a great talent pool and we have strong growth ambitions for this market” – Chanakya Dissanayake
Tell us the Acuity story. Give us some background?
Acuity Knowledge Partners, is celebrating our 20th anniversary this year and we are fortunate to be celebrating it as the undisputed global market leader in providing specialised offshore based research, analytics and technology solutions to global capital markets, the wider financial institutions and management consulting firms.
We’ve been growing steadily over the past two decades organically, and we’ve been fortunate to have been owned by Fortune 500 financial institutions like Moody’s Inc, and now by one of Europe’s leading private equity firms, Equistone Partners.
The last two and a half years have been an outstanding period of growth for us. We’ve grown across all client segments, along key client geographies as well as grown our delivery centres. In Sri Lanka over the past 30 months, we’ve grown more than 50% and now approaching almost 500 staff, engaged in analytics, technology solutions, capital markets research, and other services we provide to our global financial institution clients.
Recently we concluded the acquisition of Cians Analytics, which adds scale in an area we are very familiar with, investment banking team support and related analytics. We believe that our growth journey will continue both organically and through select inorganic opportunities.
Fairly high risks and economic challenges confront global capital markets. What specific risks do your clients want to better understand in the current environment and how do you provide this understanding?
During Covid, there was a global financial markets upturn given the very low-interest rates, and massive injections of liquidity in almost all the developed markets and the global financial centres that we support. However, there is now an expectation of a slowdown and possibly even a recession.
We believe that our business model is the best solution for asset management, investment banking and universal bank clients requiring the most efficient front office cost structure and have a global talent sourcing model for their analytics requirements. As the frothy conditions in the markets ease and banks begin to examine their cost structures, they will discover that this is the most efficient way to run a global talent pool.
In that sense, the structural drivers of our business which are driven by talent availability in South Asia compared to some European markets, as well as our cost-optimised delivery solutions would be the answer when business conditions ease a bit.
Do your clients come to you mainly for the cost saving or is there something more to it?
As we enter our third decade in existence, the early drivers of the knowledge process offshoring industry for financial institutions has also evolved.
In our early years, cost arbitrage was one of the main drivers for global banks, global asset management firms and management consultancy firms to use us. However, it has now evened out due to difficulties in recruiting specialised talent in developed markets. An example, is specialised data science talent. The challenges in retaining talent, as startups and the technology industry in general competes with traditional financial institutions and capital markets for top talent, and also having sufficient support at an associate level from well equipped offshore centres can reduce the front office work burden in these capital market firms. Availability of this support will reduce their junior staffs’ burnout rates, acting as a talent retention strategy as the available extra support, will enable clients and their teams to maintain a better worklife balance. As a result, their organisations will remain attractive to the top talent they want to attract and retain.
We now have a more balanced value proposition that is led by technology solutions and specialized talent and not only limited to cost arbitrage.
We believe that our business model is the best solution for asset management, investment banking and universal bank clients requiring the most efficient front office cost structure and have a global talent sourcing model for their analytics requirements
What sorts of skill sets will you look for in new recruits?
We are looking for quality finance, economics and accounting talent. We are also looking for quality technology talent, including software development skills and the platform knowledge for data science coming from Python.
What is the role of the Sri Lankan delivery centre in the Acuity Knowledge Partners strategy?
Our Sri Lankan delivery centre was founded to cater to asset management clients and global investment banks in Colombo and we are very committed in scaling it up. We now have almost 500 heads servicing the full length of our client needs including investment research, quant research, credit analytics for commercial lending clients, technology solutions for asset management clients, and then going into other areas like capital market compliance solutions, and so on.
We have strong growth ambitions for Sri Lanka, and we feel this market has a very good talent pool. We’ve also invested heavily alongside the Sri Lankan university system to build the talent base for us to grow.
We offer to our clients people who are technically sound about the market – Rathnakala Kumaragurunathan
How is Acuity Knowledge Partners differentiated in this industry?
Acuity Knowledge Partners comes with a lot of vintage knowledge. We were one of the first movers when the knowledge process outsourcing industry started 20 years ago. There are others in the market, but what sets us apart is the infrastructure we have created over the years that allows us to cater to evolving client needs.
At the beginning we were called AMBA. We later merged with Copal Partners that extended our offering into several new markets. Due to our delivery centres around the world we were able to implement what then we called ‘round the clock’ client services. The most important thing in bespoke investment reserch, analytics and automation technology to the financial sector, is the talent pool. When all this is combined, we are able to give that Wall Street experience allowing us to be an employer of choice in all these locations for the best talent.
How does AKP help clients understand risk?
That is at the centre of the pedigree of the product we offer. What we offer our clients is people who are technically sound about the market our clients operate in, so they can provide the right insights. In addition, clients work with our teams almost like an extension to their own. For them it’s like having an on shore team at a fraction of the cost and without the burden of managing these teams.
How do you win and retain the confidence of clients, because when they work with you, they work with a remote team on mission critical work?
Covid was a blessing in disguise in that sense, to reinforce confidence and trust. One of the biggest concerns clients have is about information security, which is one of the areas we take very seriously. We’ve always had remote access to client systems. Our client confidentiality and information security are a central part in our offering.
With Covid we had the challenge of, how do you provide that security when our own teams are working outside the office environment. But we made timely investments ensuring that adequate protocols and firewalls were in place to ensure information security. Clients were able to see, and they had oversight of this through their audits of our systems.
Tell us about what it is like to work at AKP?
Having started my career at Acuity back when it was called AMBA Research, I can speak with experience. The unique thing that we offer is the Wall Street experience here in Colombo as teams get exposure to global financial markets, and work with some great minds, while sitting here in Sri Lanka.
In addition to that, what drives young talent to work with us is the fact that we are a meritocracy. This means you are rewarded if you do well, it’s as simple as that.
Also, our teams’ diversity and inclusion add tremendous value to our work and as a company we don’t discriminate against things like religion, gender, or any aspect of someone’s belief system. At the end of the day, for whoever we recruit, it’s about their talent and about merit. That flag-bearing value culture is one of the main things that mark us out as an employer of choice.
“Data science and technology, make it possible to analyse data and provide actionable insights,” –Rohan Fernando
We live in fairly uncertain times, I’m sure your clients want to better understand the risks associated. How do you use data science for that?
The industry we serve has changed, especially during the last few years, towards a greater focus on data. Covid accelerated that change. The demand for alternative-data based research is growing because there was no other way for clients to capture these insights with traditional approaches. People were looking at footfall data, geolocation data, and some hedge funds were even tracking private jet movements in aggregate to see where the next deals may happen. Alternative data and analysis are like an insurance policy, it can back your judgments, and is another way of complementing your decisions.
Data science and technology, makes it possible to analyse data and provide actionable insights, which is like an alternative view on traditional analysis. Our data science focus has been welcomed by clients. We expect to grow our data science team to be the largest in the country.
Tell us about the work you do with Sri Lankan universities?
That’s in several areas. The first is data science which is a multidisciplinary area. To be successful we would need skills in mathematics, statistics, and computer science, all of which are high-value skills.
In some areas of knowledge services outsourcing you need scale, and as a small country our abilities here are limited. But with data science it’s not about scale but about the high quality and specific skill sets. When we looked at our education system, we noticed that our universities produce a lot of mathematicians and statisticians. What we figured was; if we can provide these students with computer science skills and the business overlay, then we would be able to create world-class data scientists. That’s the path we’ve taken.
We have several approaches to expand the talent pool horizontally and vertically. With this in mind we have introduced a programme called the ‘Research Supervisory Programme’ where based on our industry experience we propose research ideas and introduce these challenges to students and work with them for six months. We supervise the research and we help them publish.
There are several objectives in that. One, is we bridge students to challenges faced by top Wall Street investment banks. The second, is we help students with high-quality, industry trending research, and we encourage them to publish. As a country if we have a large amount of published papers that would help the university system and the country at large.
On the other hand, it allows our own team members an opportunity to work on academic projects. AKP’s is a learning culture and our engineers and analysts are passionate about learning, helping and contributing to advancing academic research.
We’re conducting these initiatives not at an organisation level, but at an industry level to raise the industry benchmark. Raising standards will benefit all other companies and the country as a whole.