Artificial Intelligence… Sure, Two Pints Please and a Packet of Salt & Vinegar!

GemCap Founder Stuart Alexander on the rise of AI – in beer brewing and fund sales – and its potential to free up sales teams to do what they do best.

Everywhere you turn AI is front and central. Hardly a day goes by without a conversation on the radio, on the news, or at a conference that isn’t talking about AI in some form or other. While out the other evening I even heard of a beer that had been brewed using AI. The Nethergate Brewery produced a very palatable beer called AiPA. Based in Long Melford, in the County of Suffolk, UK, Nethergate worked with AI to identify what makes the best beer from taste and colour to the right hops etc. What was clear, according to the Head Brewer Ian Carson, was that there was a lack of tactile wisdom and intuition that’s needed to craft the best beer possible. So, it ended up being a collaboration between the brewer and the AI tool. I had to search for this amazing brew, and I can tell you it was worth the expedition. A great combination of human expertise and digital intelligence.

In our industry, asset management, AI seems to have also taken centre stage albeit with a mixed response from different sections within the funds Industry. At last week’s Funds Congress hosted by PWC, Carne and Decherts, there was an excellent panel on AI and they covered the usual aspects in the industry, namely:

  • Alpha Generation
  • Managing Risk
  • Operational Efficiency

I will leave smarter people to opine on these but my pet subject, distribution, was not really covered and if you read the various papers on AI, it is barely covered there either. One article on fund distribution got excited about Zoom and Teams as the panacea for fund sales!

If AI can improve the customer experience of dealing with the purchase and information around a fund, then that can only be a positive step. Knowledge is everything: if you own the data then you own everything, so they say, and historically that knowledge was limited and controlled by the asset managers themselves and then distributed via a select number of data providers. The prescriptive element of this data meant it was difficult to truly analyse and conclude anything of consequence. But now AI is helping advisors to generate more insights, customise content more effectively, and deliver it to clients with greater agility and speed. The hold of the data providers is being eroded as advisors control the data directly and create a better understanding of the product. The same is true for fund managers.

In fund sales the development is slower as the requirement for “humans” is still pivotal, but many firms are now exploring new initiatives to try and make their sales teams better at what they do and, more importantly, better value for money. There are ideas around an AI-enabled digital interface for salespeople, for example. This would help deliver insights and recommendations to the salesperson in real time, based on the content of the client conversation, helping them to provide better client service and identify and progress new business conversations. Basically, KYC for a salesperson! Lucy Walker at AM Insights has created a tool that allows fund salespeople to know more about their own fund from a positioning point of view than previous incarnations have ever done. It tells a fund salesperson how their fund is doing relative to another that the fund buyer has. It helps position it and she has created a tool that builds knowledge into the sales process.

In reality around a third of a salesperson’s time is actually spent selling – which means two thirds is spent doing other things, such as coordination of administration duties and associated meetings. Sales technology such as Salesforce can obviously help with coordination and recording sales information and client details. AI should improve efficiencies but judging by the conversations I have had in recent days, most salespeople are not embracing AI. In fact, one Sales Director I spoke to said, “his team fear technology when they should be welcoming it”. Possibly they fear being caught out? Clearly the developments of digital marketing coordinated with the likes of Salesforce and Microsoft Co-Pilot helps take away some of the drudgery and low added value aspects of sending a standard email. But imagine if the technology could create an email that was bespoke. It spoke to the recipient directly about the holding in the fund they owned, did performance and competitor analysis, recognised the platforms the holder had the fund on… all automatically done at the press of a button. Why pay a salesperson £150,000 a year to send emails when AI can do it and do it better, leaving the salesperson to do what they do best: build relationships. Or as I say, “pick up the bl**dy phone” ….

I had the pleasure of speaking with Richard Philbin of Heartwood Investment Solutions recently. Richard is well known to many in the UK funds industry. An early adopter of technology, he was the first to use a laptop back in the 90s and then an iPad in meetings to take notes. Notes that he is justifiably proud of as they go back 30 years and as he says, “if the regulator ever came knocking, I have the written justification for choosing that fund in 1995!” He believes that if salespeople who come to see him don’t have the knowledge of not only what their fund does but, more importantly, what the allocation is, then they haven’t done their research. Equally he doesn’t want salespeople to tell him that the fund he has bought was wrong and that he should have bought theirs. Rookie error! He welcomes technology in creating a better experience when meeting salespeople. “Better knowledge and understanding are critical”, he says.

Speaking with James Calder of City Asset Management, again someone who has been round the block a few years and is not shy in sharing his views on all things sales, believes that if salespeople just wore out a bit more shoe leather to start with and had some more persistency about keeping in touch then that would be half the battle. “Any form of Intelligence in salespeople would be a win, never mind artificial”. He agrees that sales data and better knowledge of how funds should be positioned is critical and if AI can improve that for the sales team, then that can only be a good thing.

Because of COVID-19, the usage of Zoom, Teams, etc. has created a situation where salespeople are able to deliver solutions which are timely for fund buyers, and enable a more efficient interface between the fund and the fund buyer. Webinars via Zoom are common practice now, but equally the value of getting round a real table with potential fund buyers should never be underestimated.

Digital marketing/selling is important, but it is an ancillary to the real purpose of fund sales, namely positioning your fund in front of a fund buyer who wants to know more about your fund. James Calder says he rarely gets introduced to a new or established fund that he hasn’t found himself. What a great opportunity for smaller boutique managers who can embrace AI to get the digital selling machine in order, as many fund buyers won’t know about you until you make contact. Yes, the larger firms will be more economically efficient but the boutiques with their differentiation can really make hay whilst the AI sun shines.

In short there are a few developments in AI that really enhance the sales task at the present time, such as digital marketing, AM Insight and Microsoft Co-Pilot etc. We are still in the early stages of these developments, so it will be exciting to see how we progress and really appreciate what AI can do to help make distribution a better experience for all. Let’s never forget that it is a people industry after all.

Meanwhile I’m off for a pint of AiPA and a packet of crisps… enjoy your day in the sun!

In other news...

IMPORTANT INFORMATION

You must submit your agreement before access to the site can be granted. Important information regarding our Cookie Policy can also be found here

SCROLL TO READ

October 2022   This website is directed at institutional clients and individuals who have taken appropriate professional advice, who possess the necessary experience, knowledge and expertise to make their investment decisions and properly assess the risk that it incurs. Gemini Capital Management (Ireland) Limited (“GemCap”), trading as GemCap, is a limited liability company registered under the registered number 579677 under Irish law pursuant to the Companies Act 2014 which is regulated by the Central Bank of Ireland, reference number C155302. Its principal office is at Suite 22-26 Morrison Chambers, 32 Nassau Street Dublin 2, D02 X598 and its registered office is at 7th Floor, Block A, One Park Place, Upper Hatch Street, Dublin 2, Ireland. GemCap acts as management company and global distributor to GemCap Investment Funds (Ireland) plc (“UCITS”). GemCap Investment Funds (Ireland) plc is an umbrella fund with segregated liability between sub-funds incorporated as an investment company with variable capital registered under the registered number 485081 under Irish law pursuant to the Companies Act 2014 and authorised by the Central Bank of Ireland, reference number C67292, pursuant to the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 (as amended) ), having its registered office at 7th Floor, Block A, One Park Place, Upper Hatch Street, Dublin 2, Ireland(“the Fund”) . The contents of this site have been prepared solely for information purposes and is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation. GemCap and the Fund does not give or make any guarantee, representation, warranty or other promise or confirmation (whether express or implied) as to its accuracy or completeness.   Risk Warnings Please remember that the value of investments and the income from them can fluctuate (this may partly be the result of exchange rate fluctuations) and you may not get back the full amount invested. Past performance may not a reliable guide to future performance. A comprehensive list of risk factors is detailed in the Prospectus and the key investor information document (“KIID”) and an investment should not be contemplated until the risks are fully considered. The Prospectus and KIID can be viewed at www.geminicapital.ie GemCap does not provide financial, investment, tax or any other professional advice in any way and none of the information on this site should be construed as such. None of the information contained on this site constitutes an offer to buy or sell or a solicitation, recommendation, invitation by or on behalf of GemCap to buy or sell any security, product, service or investment. Any opinions expressed on this site do not constitute investment advice and independent advice should be sought where appropriate. The view and/or opinions expressed by GemCap through this or any other platform, may be subject to change. The shares in the Fund have not been and will not be registered under the US Securities Act of 1933 (the “1933 Act”) as amended or the securities laws of any of the states of the United States. The Shares may not be offered, sold, transferred, pledged or delivered, directly or indirectly, in or into the United States or to or for the account or benefit of any US Person except pursuant to an exemption from, or in a transaction not subject to the registration requirements of the 1933 Act and any applicable state laws, nor in any jurisdiction in which the Fund is not authorised to be publicly sold. The Fund is available only in jurisdictions where their promotion and sale are permitted. The information contained on the website may not be redistributed directly or indirectly to any citizen or resident of the United States or any other jurisdiction where its distribution may be restricted by law. It is the responsibility of persons accessing the website to ensure compliance with the above.   Disclaimer for Investors in Switzerland The Fund and its sub-funds, Calamos Global Convertible Fund and Third Avenue Real Estate Value Fund has been approved by the Swiss Financial Market Supervisory Authority FINMA (“FINMA”) for offering to Swiss non-qualified investors. This website may contain advertising. In Switzerland, the representative is ACOLIN Fund Services AG, Leutschenbachstrasse 50, CH-8050 Zurich, whilst the paying agent is Banque Cantonale Vaudoise, Place St.-François 14, CH-1003 Lusanne. Swiss investors may obtain free of charge from the representative in Switzerland, the relevant fund documents, namely the prospectus, the key investor information documents, the articles of association, as well as the annual and semi-annual reports. Past performance results are no indication of future results. Issuance and redemption commissions are not included in the performance figures. Performance results referring to a period of less than twelve months (year-to-date-performance, start of investment fund within the last twelve months) are no reliable indicator for future results due to the short comparison period.   Additional information for Qualified Investors in Switzerland: The below-mentioned investment funds, which are also disclosed on this website, are neither registered with FINMA nor under contract for representation to Swiss investors. These investment funds may not be distributed neither to Swiss non-qualified and qualified investors nor exclusively to Swiss qualified investors:   GemCap Investment Funds (Ireland) Plc Atlantic House Defined Returns Fund Atlantic House Global Defined Returns Fund Atlantic House Total Return Fund Atlantic House US Enhanced Equity Fund Atlantic House Uncorrelated Strategies Fund Calamos Global Convertible Fund Calamos Growth and Income Fund Causeway Defined Growth Fund GSI Global Sustainable Value Fund GSI Global Sustainable Focused Value Fund London & Capital Global Balanced Fixed Income Fund London & Capital Global Conservative Fixed Income Fund London & Capital Global Defensive Equity Fund (this Fund has terminated and accordingly, Shares in this Fund are no longer available for investment) London & Capital Global Growth Fund London & Capital Global Growth Fixed Income Fund London & Capital Global Star Equity Fund London & Capital Global Balanced Fund London & Capital Global Equity Opportunities Fund Principal Asset Allocation Fund Semper Total Return Fund TEAM International Equity Fund Third Avenue Real Estate Value Fund   Legal This GemCap website and material contained herein (including information from third parties) is provided ‘as is’, without any representation or endorsement made and without warranty of any kind whether express or implied, including, but not limited to, the implied warranties of satisfactory quality, fitness for a particular purpose, non-infringement, compatibility, security, completeness and accuracy. By entering this site, you acknowledge and agree that the use of this site is at your own risk and to the extent permissible by applicable law, in no circumstances, including (but not limited to) negligence, shall GemCap be liable for any direct, indirect, incidental, special, consequential, or punitive damages, losses, costs or expenses nor for any loss of profit that results from the use of, or inability to use this site or any material on any site linked to this site (including but not limited to any viruses or any other errors or defects or failures in computer transmissions or network communications) even if we have been advised of the possibility of such damage. In addition, no liability can be accepted by GemCap in respect of any changes made to the content of this site by unauthorised third parties. All express or implied warranties or representations are excluded to the fullest extent permissible by law. We do not warrant that this site does not infringe any intellectual property rights of third parties. No data transmission over the internet can be guaranteed as totally secure. Whilst GemCap strives to protect such information and every effort has been made to implement security protocols, in line with relevant legislation to ensure safe processing and storage of any data transmitted, we do not guarantee and cannot ensure the security of any information which you transmit to us. Accordingly, any information which you transmit to us is transmitted at your own risk. The GemCap website is not a substitute for independent professional advice and users should obtain any appropriate professional advice relevant to their particular circumstances. The information on this site is issued by GemCap.   Cookies If you use the internet quite a bit, there’s a good chance you’ve heard of cookies. But what are they? Also known as HTML cookies, tracking cookies or magic cookies, these tiny files are automatically downloaded by your computer when you’re browsing online. Don’t worry – they’re perfectly safe. But we’d still like to take a moment to explain what cookies do, which ones we use and how to remove them – if you really want to. Are Cookies Safe? Yes, cookies are safe. The information they collect is completely anonymous. We never, ever, collect personal information using cookies. What’s more, cookies are not harmful to your computer, they take up minimal space and they can be removed with just a few clicks. GemCap’s Cookie Functionality
  • Cookies provide enhanced functionality and speed to our site
  • These cookies help us to recognise your computer when you visit Gemini-Capital.ie and enable us to improve your visits to our website
  • Cookies assist us in identifying what kind of visitor/user you are, for us to provide you with the most relevant content
How Can I Remove Cookies? Most computers are set to download cookies automatically, so if you’re happy with everything you’ve read, simply carry on as you were. However, if you’re at all concerned about having cookies on your computer, deleting them is simple. Show me how to remove cookies Likewise, you can also change your computer settings so that it won’t download any more cookies. Show me how to change my cookie settings The information on this site is issued by Gemini Capital Management (Ireland) Ltd, which is registered in Ireland No. 579677. The registered address for the company is 7th Floor, Block A, One Park Place, Upper Hatch Street, Dublin 2, Ireland. For further information on our use of personal data collected and stored by the firm and its approved vendors, please see our Data Protection Statement, which can be found in the “Our Policies” section on this website.