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Matt Brown

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66
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2021-10-11
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2021-10-11
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1
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podcast

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  1. “To make it easy, important. But as you and I both know, if we don't understand something, we're not going to do it, especially as a financial advisor. So that really got the momentum going on the investment side from the financial advisor. On the product side, as you said, well, assets started flowing across our platform in pretty enormous scale towards the asset managers. And they were finding themselves being able to increase their shareholder base and diversify their shareholder base with a completely untapped community of investors. that really wanted to be their investors and if not for the case platform, they just weren't able to get access to those types of products. So what we did was among the many things, we onboarded their funds on our platform, we digitized the entire workflow process, we reduced the minimums from 10 or 20 million dollars down to $100,000. We didn't increase the fees or price. And then we opened that up to the investor channel and the financial advisor side.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “Two ways we can look at it. What's the value prop for the financial advisor? And what does it take for them to make that work? Well, initially we thought as a fintech company, why don't we just make things a little easier, a little more automated, a little more digital, and create some of that seamless workflow that takes the pain out of the process. It turns out that's only a part of the story. What it really takes is a commitment to educate financial advisors or bring scalable education to financial advisors so they understand the funds and how to implement them in client portfolios. So we've been investing a lot into digital education. We have the state-of-the-art learning platform called KSIQ, where advisors can really interact with our platform. It's artificial intelligence powered, and the advisor really understands what the products are designed to do, the funds, and how to implement them in a portfolio. That really became the game changer for us. Of course, the technology.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “Conceptually, it's not hard to see a value proposition of a pool of capital that's not accessing alternatives, a group of alternative managers that's not accessing a pool of capital. What did it take in the platform to make that work?”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Or any two sided marketplace platform, you come back for more. And we've been able to really just create this organic flywheel effect between both sides of the market and billions of dollars a year of transactional volume is crossing our platform between these two communities for the first time. And it's quite exciting.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “this great channel of investor that has very low allocations to alternative investments, which is the RAA channel to the independent wealth channel. And we said we could deliver their products seamlessly and effectively into that market. And many of them thought it was a great idea. Interestingly, I thought in the beginning that getting the products on board, asset managers would be the more complicated piece. In reality, it turned out to be a little easier than we thought. It was all incremental value to them. And then the other side of the horse was getting the financial advisors to use a platform at all to access alternatives. Some financial advisors never used alternatives, so we were in the education business. Some were investing alternatives, but they needed to fill out paper subscription documents. It was very cumbersome. So how do we get them on platform? So really getting that flywheel effect started when we were delivering value to both sides of the platform. And just like when we have a good experience on Amazon or Airbnb.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “Sure, being an entrepreneur and building a business, you have to take a few leaps of faith and have just the utmost confidence in your own ability and the ability of your team. So some of it was clearly delivering on our value prop. Some of it was promising things and hopefully we would be able to deliver them. So on the asset manager side, you have to remember, this is a time where we're coming out of the global financial crisis. all firms, regardless of industry, were somewhat looking to reinvent themselves in different ways. Some of the private equity firms and hedge fund firms may have seen some of their assets decline during the global financial crisis or advisors or investors or institutions pulling capital out, especially from some of the more liquid ones that may have been performing fine, but they just could create liquidity. What we did is we went to the asset managers that we thought were solid and brand and track record, but possibly wanted to expand their shareholder base. And we explained”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “One of those challenges anytime you try to have a two sided platform is you have to get the engagement on both sides. So take me through that path of how you're able to go from scratch to where you are today from both sides of the platform.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “Though competing against the big wealth management firms like JP Morgan for the attention of the end client didn't have a platform to be able to get access to alternatives. So frankly, they were planning a bit with one hand tied behind their back. So I put my arms around this David and Goliath's story, the small RIAs versus the big Goliath JP Morgans in the world, and got behind the small guy and see if we could democratize access in a way that never could be done before.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “really was a light bulb moment. So, having the experience of wealth management. Very interested in businesses and models that solve problems. I was having lunch with a friend of mine who was a financial advisor at JPMorgan. And at the time I was definitely scanning the industry thinking about what ideas might be out there that I could sink my teeth into. And he was talking about the alternative investment platform at JPMorgan that had all the third party asset managers on it that they were able to pick from to be able to invest on behalf of their clients' capital. And he kind of went one step further and said, It's actually a huge competitive advantage because I'm able to give access to the biggest institutional alternative asset managers to all of my clients at JPMorgan. And those clients can't get that access from other firms, especially the smaller ones. Now, being in wealth management, I was very aware of the highly fragmented and growing RIA channel. And it quickly dawned on me that the RIA channel”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “That traveling a lot is tiring. And if there's a better way to do it, a faster way to do it, a more efficient way to deliver information and gain access as opposed to caring a bag and walking into a conference room. I was a game to try and figure that one out.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “It was five years, and then the entrepreneurial itch came about and I started a company that was in the alternative investment space. And that's where I got the second half of the skill of building a two-sided marketplace platform-like case, which is on the product side. And I spent about a decade in alternative asset management distribution, both domestically and internationally, and really understood what it was like to walk the streets of New York and Geneva and Singapore and explain complex investment strategies to financial advisors and private banks and institutional investors.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “Really from the seat now a lot about the clients that I serve every single day, about their needs and their pain points. And that was an invaluable step in kind of building the foundation to be able to build the platform of case.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “phone rang with Sheerson Lehman Brothers and they said we'd like to offer you a spot in our training program and I instantly said I accept I was somewhat of an accidental financial advisor if you want to call it that a year into my job though I did catch up with the gentleman who interviewed me and he since became a good friend and mentor and I asked him why'd you hire a kid with a liberal arts background why didn't you go for a guy with an economics or a finance background to join your wealth management group And I'll never actually forget his answer. He stared at me. He smiled, and he said, Matt, I can teach people math, but I can't teach people how to communicate. It really served that comment, though, as a lesson of life for me and something I've taken with me throughout my career, which is that really finance business is about people. It's about communication. It's not just about numbers and spreadsheets. That's really served me well. So I started my career as a financial advisor and learned”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “That's quite a story. So I graduated with a liberal arts degree and a friend of mine who worked for Shearson Lehman Brothers told me that they were hiring and training new financial advisors. I not only didn't know what Shearson-Lehman Brothers was, I didn't know what a financial advisor was, but I really needed a job. So I interviewed. I can still see it today, you know, walked in. It's a oak-paneled room. I met a gentleman there, older gentleman who was wearing a three-piece suit, had spectacles on. He looked like a character right out of a kind of a Wall Street documentary. It was quite an experience. And we spoke for two hours. Any topic that I could regurgitate from school that was fresh. That made me sound halfway smart. Desperate to keep the conversation going. Then it ended and we shook hands. And I can remember walking out thinking, wow, I really don't want to be a financial advisor. That's for sure. That wasn't interesting at all. The next day.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “Our conversation covers Matt's background as both a financial advisor and a distributor of alternatives that collectively led to the idea behind case. We discussed the development of a two-sided platform, structural features for both financial advisors and managers, and challenges along the way. We then turned to the wave of capital coming from this community and what it means for investors. Lastly, we discuss MAP's perspective on leadership and the future of CACE. Please enjoy my conversation with Matt Brown. Matt, great to see you”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “Hello, I'm Ted Sides, and this is Capital Allocators. This show is an open exploration of the people and process behind capital allocation through conversations with leaders in the money game, we learn how these holders of the keys to the kingdom allocate their time and their capital. You can keep up to date by visiting capitalallocators.com. My guest on today's show is Matt Brown, the founder and CEO of CACE, a leading alternative investment platform on which thousands of financial advisors have invested over twelve billion dollars in alternatives across private equity, private credit, hedge funds, and real estate.”

    2021-10-11 · Capital Allocators · Matt Brown – Democratization of Alternatives at CAIS (Capital Allocators, EP.214) · IDENTIFIED FROM THE TRANSCRIPT · source