Pepper: Alternative Asset Management Decoded

Pulak Sinha, Founder & CEO Alternative asset management is a complex industry. Asset managers spend all of their time trying to find the next best deal, by analyzing companies, predicting cash flows, and running complex analysis on the financials to help make crucial investment decisions, often times with limited success. “It’s interesting to note that for every deal that an asset manager does, he has probably analyzed well over 50 deals. So in a mid-size portfolio of 300 deals, the manager may have analyzed well over 1,500 other assets. He has put together a huge amount of data and unfortunately, in today’s technology, all of it remains unavailable for future references, a huge waste of precious information” explains Pulak Sinha, Co-Founder and CEO, Pepper. But Pepper has begun to change that, and much of it has started with an innovation that’s turning heads everywhere.

“What Pepper is creating is a truly comprehensive digital platform that will be the backbone for asset managers for the next 20 years,” says Sinha. “Customers will use Pepper to capture, view, analyze, and mine the data for making critical investment decisions.” The platform is designed to address a litany of challenges in the alternative asset management industry, which range from reliance on unwieldy spreadsheets, the unavailability, or timely availability, of large amounts of crucial data to the dataheavy and number-crunching nature of its presentation. Using Azure, Pepper is able to engage their clients and set them on the fast track to better investment management, and their commitment to this goal runs as deep as the strategy by which they run their business.


Setting a Standard -Enterprise SaaS Platforms

In the asset management industry, success is driven by the ability to continually come up with new investing ideas. For Pepper, much of that inspiration stems from changing market conditions, regulations and, most importantly, the customer. Much of this thought is rooted in the company’s culture, which spotlights their philosophy of ‘innovation with a purpose.’ Pepper’s client focus is unique from both product innovation and delivery purposes.

Given the dynamic nature of the industry, where launching new funds regularly with new investing strategies is core to industry’s growth and performance, Pepper stays at the cutting edge of industry’s needs through ongoing dialogue with all industry stakeholders. “To keep track of where the product needs to evolve, we are constantly having conversations with our clients, partners, and other market participants like auditors. This keeps the pipeline of ideas fresh,” elaborates Sinha.

On the product delivery side, Pepper has used technology and its unique product architecture to offer critical product customization to its clients without incurring proportional cost and compromising on delivery time. In this regard, while remaining a SaaS product, Pepper does not follow the 100 percent self-serve model that is all too common in other SaaS companies. Not yet.


It is not always about the big challenges. Sometimes the smallest additions add huge value to a user


Pepper is developing a library of commonly used customization features right into its product, thus allowing some of its customers to completely auto-customize Pepper’s platform for their needs. In every case, however, clients always have full access to Pepper’s Client Services team for individual attention any client may need.

Leveraging Trends and Integrating with Azure

As a result of keeping a close watch over their industry, much of Pepper’s strategy involves using Azure to leverage effective trends in different areas. One example is their use of the cloud, along with elastic architecture and flexible databases to capture and analyze highly unstructured data. Another is their use of Azure to incorporate a mobile platform into their offerings. In the asset management industry, most mobile platforms are simply used to access emails and the news. With Pepper, enterprise data is made available on mobile, meaning that asset managers can work away from their desks with a product that is faster and more scalable.

APIs (Application Programming Interfaces) are also a big part of Pepper’s integration between productivity tools and market data. The alternative asset management industry has historically not used much technology. As digital technology penetrates the finance industry, Pepper is committed to being a pioneer in fundamentally changing existing functions within the industry and providing new, previously unavailable capabilities. Pepper is integrating in its platform several industry-leading tools like Slack for messaging, payment processing, CRM, etc. Because of legacy technology and architecture of firm’s competitors, they are unable to leverage these applications into a comprehensive enterprise platform. Thus productivity tools historically never got adopted as part of the core framework for even mid-size asset managers, who typically abandon them after an initial tryout. With Pepper’s Azurebased architecture, these applications are easily brought in and used to create a seamless, evolving environment that will continue to benefit the client well into the future.

Pepper is also benefiting from another key benefit of Azure—international expansion. Many funds require local data storage to comply with their home country regulations. Azure allows Pepper to meet such requirements for its international clients by seamlessly using local Azure data centers to store their data locally.

Creating Successful Scenarios

Pepper has been involved in a number of big wins for their clients. One instance involves credit assets, a growing asset class that involves performing fundamental analysis on security, macro-analysis on the sector, and company analysis on each asset before it’s purchased.
This required credit managers to handle a large influx of data. One credit shop was looking to create an Internal Rate of Return (IRR) for every quarter. They had a spreadsheet with 80 tabs, all linked, with complex formulas that needed to be updated daily, and required at least a week of intense data-gathering and reconciliation. By automating almost every single task, Pepper dropped the time required to complete a month-end report to less than half a day, thus generating over 70 percent time-efficiency for their client.


"What Pepper is creating is a truly comprehensive smart digital platform that will be the backbone for an asset manager for the next 20 years"

“It is not always about the big challenges. Sometimes the smallest additions add huge value to a user,” says Sinha. In one such instance, a client with $2 billion under management added a feature that allowed users to have all documents, generated while doing a deal or managing an asset, stored as part of the system. They were also able to add commentary and notes with respect to any action or piece of data, if necessary. After using it for a few months, the fund manager called it ‘the most important feature’ he had ever used on Pepper. The improved document storage helped to reduce his audit costs significantly and he no longer had to search for spreadsheets, documents, or even comments.

Blazing a Trail

As part of their culture, Pepper continues to engage with all of their clients to understand the needs that have to be met in the market. One essential need involves having their systems not merely be data repositories, but tell a story to the person using it. “Every data element the client wants to see adds up to a story,” begins Sinha. “There is a story about the firm’s strategy, risks, cash flows, valuations, or new opportunities to become the best asset manager in the market. They need these insights to make investment decisions or convince investors that their strategy works.” Pepper is now phasing out tabular formats containing rows of data and introducing visual representations that tell unique stories beyond outputs from number-crunching, both on an interfacial and architectural level. Now, asset managers can log into the Pepper platform first thing in the morning to see the precise visual dashboard that shows all key metrics and latest up dates at the fund. Similarly, every analyst will have similar dashboards for their individual function.

Despite the focus on evolving their solutions, Pepper still intends to stick to their roots as partners and users of Azure. They continue to learn from how Azure implements solutions and use that knowledge to bring their clients more secure data, higher quality performance, and better scalability. In fact, as part of their advice to CIOs everywhere, they recommend checking out the platform, its development cycle and release management and seeing the innovation for themselves.

“To any budding entrepreneur, we suggest that they keep up with the innovations that are happening in Azure. They add tremendous value to your clients. It is amazing that the very foundation of your business can grow rapidly and your product can take advantage of those changes to become even better,” concludes Sinha.

Company
Pepper

Headquarters
NewYork City, NY

Management
Pulak Sinha, Founder & CEO

Description
Connecting clients with accurate information, and utilizing the power of deep data to allow them to make better, faster, and more profitable decisions

Pepper