SINGAPORE (Nov 18): The 2008 global financial crisis forced many central banks to adopt more robust strategies in risk management. Stronger regulations were put in place and banks around the world were required to report their activities in real time. But there was just one problem: These banks were not sufficiently equipped to deal with such an onslaught of data.
This was one issue that led to the forming of UK-based Solidatus in 2017. The company says its specialised data lineage software is an intuitive web-based application that allows organisations to discover, visualise and understand how data flows through their systems.
According to Solidatus co-founder and director Philip Miller, his stint as global head of global data and information services at HSBC Holdings helped him realise that banks wasted a lot of money trying to process and understand huge amounts of data.
“We saw some gaps in the market around regulation and transformation, mainly in banks, where the understanding of how a company worked was not sound enough. We found that there were no good tools available in the market to do this,” says Miller in an interview with The Edge Singapore. “With the large influx of information every day, banks and other large companies often found themselves overwhelmed, which in turn increased the possibility of errors and miscommunication.”
Furthermore, Miller adds, most of these organisations generally relied on outmoded tools such as spreadsheets and powerpoints — tools that were not made for data management.
Real-time data and regulatory information
According to Miller, what sets Solidatus apart from other tech companies is the “plan, build and run” framework that it adopts for both data and regulatory lineages in a company.
Solidatus’ software allows an organisation to easily identify the data source to track its journey throughout the enterprise while providing insight into the different processes within the data flows. In doing so, it enables the organisation to safeguard its data and mitigate the risk of a breach of regulatory requirements on data protection, reduce operational costs and improve transparency.
Through working with partners such as EY and KPMG, Miller says, a significant amount of time and money is saved. “We deploy the software and methodology, and partner with others who can do the work for us and collate data on our behalf.”
On the regulatory front, Solidatus aims to allow companies to both satisfy the regulators and react quickly to change. It presents clients with detailed and complex data lineage in visual forms such as graphs and charts. The software also utilises a browser-based application that can be up and running in the cloud in minutes.
“Our approach is novel — we operate like a check and balance,” says Miller. “As we do something, we make a conscious effort to ensure that this is what the company expects.”
Insider knowledge
Miller feels that the knowledge he and his co-founder Philip Dutton acquired during their stints in the banking and finance industry is what gives them an edge over their competitors.
Prior to setting up Solidatus, Dutton was responsible for front office trading systems transformation at Deutsche Bank. “Having been in the banking industry for a long period of time, we were both aware of the problems and the lack of solutions,” says Miller.
While solutions were available in the market, Miller notes that they were either too expensive or too complicated — a problem for most businesses. “The cost of change was too high, and the perceived cost of IT was unexplainable. Organisations simply couldn’t make large-scale changes without its costing them a large amount of money. We believe [data management] is a simple issue that can be resolved elegantly without too much complication.”
Meanwhile, he also noticed another problem: a lack of communication between the tech department and everyone else in the company. “The business people will always think that IT is expensive, and IT personnel will always think that the business doesn’t care — and both are incorrect. We encourage collaboration between both parties — we allow each to speak the language they excel at,” says Miller.
Instead of organising regular meet-ups with businesses to consolidate and explain the data collected, Solidatus prides itself on the software’s easy-to-use interface. While Miller and his team remain on hand to help businesses use the software, he claims that that rarely happens, as clients are able to use Solidatus with minimal supervision.
A cautious approach
While they believe they have stumbled on a winning formula for a start-up, the co-founders claim they did not rush into the venture. Instead, Miller says both of them were careful to stay employed to ensure they had a consistent flow of income during the initial days of testing of the software.
The initial work began in 2013 when Miller and Dutton began writing the software codes and testing the software out on various “trial clients”. But it was only in 2017 that the team managed to secure some commissions to sell their software.
By 2018, Miller and Dutton were sufficiently confident of their product to give up their day jobs to focus on Solidatus full time.
“Today, unlike in the past, big companies are almost expected to be able to digitalise themselves. Instead of working with large companies such as Oracle or Microsoft, which tend to be cumbersome and slow, they now want to work with small and agile companies with advanced technology in place,” says Miller. “We entered the market at the right time, but we had to wait for the market to catch up.”
Greater focus on Asia
Currently, Solidatus has 15 clients, three of which are based in Singapore while the rest are in the UK, Europe, the US, Vietnam and Thailand. Some of the established brands in the company’s client roster are multinational retail corporation Walmart, investment and financial services company Deutsche Bank and asset manager RPMI Railpen.
Solidatus has plans to make Singapore its regional headquarters. “We think Singapore is a mature market with a good regulatory regime that is located in a very stable area of the world,” says Miller. “It also has good connections to other countries, which is important for us.”
“Asia is a huge emerging market with many technological developments and [many opportunities] for the company,” says Miller. “All our regional businesses and transactions will be run out of our office in Singapore, which opened in February.”
But while it has been relatively easy for Solidatus to break into the international market, Miller admits that the company has yet to get off the ground in the local market. “There is a different maturity level between the local and international markets, but that does not necessarily mean that there’s something wrong with Singapore,” he says. “The international market has been exposed to different regulations for a longer period of time. But the local market is maturing quickly, and we hope to help ease Singapore companies into the data-conscious world.”
But there are signs the company is making its mark in the city state: Recently, Solidatus was placed first in the UBS Future of Finance Challenge 2019 in Smart Risk Management, taking home US$20,000 ($27,254).
As a bonus, UBS also pledged to help the winners further commercialise and scale their ideas and technologies using its significant global presence.
That pledge could be that extra boost Solidatus needs to take its brand forward, Miller reckons.“In Asian countries, companies such as Solidatus need a range of local partners; it’s almost impossible to operate independently as an international company without the relevant partnerships. Organisations such as UBS make it easier for us to tap both the local and international markets,” he says.
In tandem with its ambitious expansion plans, Solidatus has been receiving offers for funding for the past two to three months, and is expecting to raise US$10 million in a Series A or B funding round by 2020. The company is also part of the start-up accelerator programme launched by the Monetary Authority of Singapore in 2014.
“Our proposition is unique, and with the utilisation of cutting-edge technology in our software, we are currently ahead of the market. We believe we are almost the only solution to some of the newer data challenges that are present today,” Miller says.
