Interview | Satyen Patel - Executive Chairman Eton Solutions

Family offices have increased in number globally, is there any driving force behind this?

The world is witnessing the largest transfer of wealth from one generation to the next in our lifetime - to the tune of USD$15 trillion. Approximately USD$6 trillion of it comes from North America and the balance USD$9 trillion across the globe. The growth in wealth in the UHNWI segment has been staggering over the past two decades.

Within that segment, there is recognition of ensuring that wealth is managed with adequate cybersecurity, proper controls, good corporate governance and regulatory compliance. All those items collectively start emphasising the need to move towards digitisation.

There is a step-function change in thinking that advocates moving away from highly manual single point solutions with multiple data-entry steps that are error-prone and highly exposed to data breaches. The need for a comprehensive solution got accentuated during COVID-19 where remote working became a necessity.

It has accelerated the move towards enhanced cyber-security, automation, and comprehensive digitised solutions. Having access to information is powerful, and having access to timely information at the tip of your fingertips when you need it, wherever you need it, is even more powerful. Digitization lends itself to all the above. It is here to stay and will continue to accelerate.

What are the common needs and challenges that new family offices face when setting up? Does the AFO™ address these?

We observe that with a purpose-built enterprise technology solution, there can be efficiency in communication and the capability to enact the advice of several family offices' advisory partners. Most family offices run with high operating costs and the usual spend for management is between 1-2% of total assets.

Family offices have over 270 different processes and workflows, which can be overwhelming and consuming for CIOs, CFOs, Controllers, Fund managers and other family office staff. New family offices also need to be made aware of the extent of the operational scope and complexity of setting one up.

The AFO™ addresses all these needs by creating a one-stop platform that can be accessed by all members of the family and optimises and curates all those processes for seamless wealth management.

Is the AFO™ only aimed at Family Offices? Are you planning for future products that can supplement the AFO™?

This platform and integrated offering are designed specifically for Single Family Offices, Multi-Family Offices and Institutions catering to UHNWIs. Family offices can choose from three Administrative Family Office™ collaboration models, depending on their level of need.

All models include standard features such as core accounting and reporting, transaction processing, interactive dashboards, best-practice workflows, a mobile app and a virtual mailroom.

This newly launched AFO™ allows us to cater to Family Offices with an AUM of $100 million and above. The priority is to introduce this product to family offices globally. Once the AFO™ becomes a staple, it would make sense to create other complementary products to enhance the services of the AFO™.

What is a competitive advantage that the AFO™ provides Family Offices for wealth management?

The fully integrated AtlasFive® platform allows for multiple and easy access points as the platform is available on laptops and mobile devices. This gives flexibility for clients to retrieve information at any time, any place where they have connectivity and cell-phone coverage.

The AFO™ allows clients to have complete visibility into their wealth, both liquid and illiquid assets, as well as alternative investments like private equity, hedge funds, fund of funds, wine, automobiles, yachts, private jets and art collections. Family offices no longer need to outsource their middle and back-office operations to different providers.

Eton Solutions’ AFO™ provides a comprehensive digital and integrated client-centric experience from investment reporting to accounting, document management, tax support services and fund accounting. In essence, it is an enterprise resource planning system developed by a family office for family offices.

The combined power of the AtlasFive® Platform with the suite of services offered makes for a seamless client experience wherein they do not have to worry about managing a complex middle and back office operation within their family offices. They can focus on higher end advisory, trust and investment related aspects of managing and creating wealth.

How do you think Eton Solutions’ headquarters and the new AFO™ solution will support the growth of family offices in the region?

Eton Solutions remains agnostic and independent in the family office ecosystem and is open to collaborating with extensive partner networks to help family office clients grow and scale up.

The company's new Administrative Family Office™ solution will take advantage of the need for establishment and proliferation of family offices activity globally and is now available worldwide. Eton Solutions and its AtlasFive® platform is the only family office software available in the market that is built specifically for a family office by a family office.

Eton Solutions’ Administrative Family Office™ harnesses the standalone power of AtlasFive® and couples it with its services suite — synthesising two world-class offerings into one robust solution.

Have you considered opening an office in Europe?

Our current International Headquarters in Singapore is meant to service family offices internationally in all markets outside of North & South America. We are looking to open regional offices in both London and Dubai in the near term. This eases the process of connecting Eton Solutions’ services to these countries.

How big is the Family Office market in France and the larger European region?

In recent years, family offices have grown the most in regions like North America, the Middle East and Asia. In Europe, there are about 2,300 Family Offices, which is a large market for us to work with.

How different is the Family Office landscape today as compared to ten years ago?

The concept of a family office goes way back, with one of the earliest ones being the Rockefeller Family Office in the USA. With the staggering growth of global wealth in recent years, that number has expanded to close to 10,000 family offices globally. In recent times, family offices are also involved in more philanthropic and ESG driven objectives that help proliferate and diversify their manifesto.

What governance framework exists within the AFO™ to enhance office functions?

The defining strength of the Eton Solutions AFO™ is a single source of truth - one database for all your assets. It is a comprehensive system that provides an investment book of records (IBOR) and accounting book of records (ABOR). But it is also a full cycle system that initiates transactions and allows one to make capital calls, bill payments and simultaneously maintain the general ledger, all in one unified system.

The platform has direct data feeds from over 700 custodians and can provide digital data feed access to over 1500 custodians. All auditing documents are stored and updated on the system and are simultaneously tagged to specific transactions to provide an accurate audit trail ande reconciliation daily.

There is no mad rush for an end-of-the month closing, quarterly closing or a yearly closing. It confirms all the regulatory, compliance and reporting requirements mandated for family offices undertaking money movement.

Was it challenging finding external vendors and staff supporting the family office?

Recruiting and retaining talented staff to run the middle and back-office operations of a family office is a constant challenge for family offices globally. The UK and Europe are no different.

Our platform allows the family office to focus on the task of managing their wealth, investments, governance, and controls in a digitised, cybersecure and cloud-native environment; all of this while providing Privacy, Security and Control to the patriarchs and matriarchs of these families.