The Client
Long Lake Research Group is an independent globally focused investment research and advisory firm based in Sydney. Long Lake Research Group takes an unconventional approach to the provision of investment and corporate advisory services through the capture of value arising from challenging the status quo.
The Challenge
The UTS EMBA student team was asked to search business opportunities to disrupt the Australian superannuation industry. While holding $2,000 billion in assets spread across just shy of 600,000 funds, this market lacks transparency and is crowded with intermediaries, to the expected detriment of retail investors. Long Lake Research Group wanted to explore the potential of distributed ledger technologies such as blockchain to improve product quality and value transparency within this market.
The Solution
Through this project, the UTS Executive MBA students delivered two valuable results:
- The team quantified the value of asset consulting services which were believed to act as a bottleneck to innovation within the industry. The team noted that asset consultant’s direct financial burden to the industry did not represent a high value disruption opportunity in an absolute sense
- The students promulgated an innovative and potentially more financially rewarding approach for the delivery of greater transparency and control for retail investors. This recommendation was accompanied by a product and infrastructure development plan
To reach this solution, the team first had to unpick the complex superannuation industry through:
- Substantial desktop research
- Interviews with investment management industry senior executives
- In-depth conversations with academics and observers to shed some critical light on the executives’ views
The team’s insights allowed them to redirect the client’s focus early in the project to a potentially larger scale and more disruptive opportunity, i.e. create an engine enabling comparison and selection of products to facilitate the construction of either a wholesale and/or retail multi-manager portfolio. The proposed solution is characterised by attractive commercial potential arising from the greater empowerment of collective asset owners (e.g. industry funds) and their members/clients. The innovative nature of the proposal satisfied Long Lake Research Group’s initial intent of realigning information asymmetry in the investment management industry.
The UTS Executive MBA team helped us to think differently about the scale and scope of disruption opportunities in the Australian asset management market. Their fresh analysis and innovative approach illustrated that retail investors may be empowered as end users within an institutional investment context.
- David Langford, Managing Director, Long Lake Research Group