As technology developments create new opportunities finance professionals to push the boundaries of what’s possible in asset management, strategically applying new technologies and processes is critical to success. The insights below highlight key trends shaping the industry, including scalable data capture and analysis, the impact of tokenization, strategic uses and the limitations of AI, as well as optimizing IT landscapes for investors and hedge funds.
Investment Management Industry Consolidation Continues – Oleg Movchan, CEO
The consolidation process of the investment industry will continue and accelerate. Commercial models for both traditional asset managers and wealth managers are notoriously difficult to scale, requiring a tricky balance between comprehensive asset class and product coverage, talent growth challenges and operating costs. In many market segments, as well as more broadly, a “winner takes all” market structure seems to be taking shape. Therefore, we will continue to see industry consolidation, both across businesses and across product lines – recent M&A transactions in the space are too numerous to list. As such, we expect that open and flexible technology architecture – both in terms of functionality and delivery (SaaS vs. on premise) and ownership (buy vs. build) – will remain central to differentiating between successful and failing M&A strategy, for both acquirers and targets.
Unlocking Private Credit: The Scalable Data Demand – Movchan
Private credit markets are on the precipice of a data-driven transformation that will redefine operational efficiency and replace antiquated technology landscapes. By building scalable, intelligent workflows around comprehensive and robust terms and conditions data (the common language of private credit), firms can establish appropriate technology infrastructure upon which they can optimize their operational ecosystem. Such initiatives will be key drivers in dramatically reducing operational risks and overall costs, as well as creating new value streams. The key to success will be developing a robust, flexible security master and meta-data environment that properly captures the ontology of complex credit instruments and turns this information into strategic, risk and valuation insights.
Tokenization: The Next Frontier of Financial Innovation – Movchan
Tokenization will continue to revolutionize how all financial instruments and real-world assets are traded and managed. Deregulation of financial services, increased appetite for non-traditional asset classes and strategies as well as technological advances, will accelerate the democratization of investment opportunities, creating more liquid and efficient markets. Forward-thinking firms will see tokenization not as a disruption, but as a strategic opportunity to drive and enrich portfolio construction, enhancing business economics while delivering better investment outcomes for their clients.
Portfolio Construction: Breaking Down Asset Class Barriers – Movchan
The future of investment management lies in a holistic portfolio construction paradigm that seamlessly integrates liquid and illiquid asset classes. Advanced data capabilities and sophisticated risk modeling and valuation analytics – powered by scalable security masters, modern analytics and AI and machine learning – will enable firms to create more nuanced, transparent and diversified investment strategies that meet increasingly complex client demands. The firms that can effectively combine these traditionally segregated asset classes will gain a significant competitive advantage.
AI Finds Alpha: Reimagining Investment Intelligence – Movchan
Machine learning and AI will continue to transform alpha generation and capture for investment managers. By combining advanced quantitative models with strategic insights, firms can unlock more efficient information sourcing and risk management by combining data-driven frameworks with discretionary overlays. The most successful investment strategies in 2025 will be those that masterfully blend algorithmic precision with human judgment.
The SaaS Transformation: Achieving Agility by Shifting Solution Delivery Strategies – Movchan
In 2025, asset management firms will accelerate their shift from rigid on-premise systems to flexible SaaS solutions that dramatically reduce total cost of ownership. This transition isn’t just about technology—it’s about creating organizational agility that allows firms to rapidly adapt to market changes, enable growth and provide more custom offerings based on client needs. This can only be accomplished through seamless updates without the need to manually configure functionality, upgrade software and IT infrastructure in response to each new development. The most successful firms will view their technology infrastructure as a strategic enabler, not just a back-office utility, and will partner with their vendors to balance buy vs. build decisions.
In 2025, Data Will Be the Differentiator – Neal Pawar, COO
As AI becomes increasingly open-sourced and customizable, your alpha will be the data you train it with. How you generate, curate, store, secure, remove bias & errors, structure, and deliver data will become a priority for companies looking to leverage AI. Data carries your expertise, your values, your know-how. Data is where your best employees share their best practices for the benefit of the whole workforce. Data is also how your clients steer you to build better products and services. It’s your differentiator.
Future-proof Asset Management by Keeping Lift & Shift in The Rearview – Dan Groman, CTO
By 2025, we’ll see a dramatic shift in how asset management firms approach technology modernization, moving well beyond traditional “lift and shift” cloud migration strategies that have dominated the industry. Nearly all asset managers (95%) recognize technology and digital capabilities as key differentiators, yet many firms remain tethered to legacy systems that impede their ability to adapt and scale. Simply relocating existing systems to the cloud without reimagining their investment operating model will put firms at a significant competitive disadvantage as a result of the time, cost and personnel required to maintain this IT infrastructure. The true differentiator will be the adoption of enterprise-level SaaS solutions that eliminates lift and shift as well as the upgrade trap – which leads to operational disruption as a result of downtime during updates – and hidden costs associated with hardware maintenance, version control, and dedicated IT staffing. Beyond selecting the right approach to modernizing legacy systems, there are other emerging technologies that should be part of anyone’s long term vision.
In 2022, the world was inspired by the release of OpenAI’s ChatGPT and the progress that’s been made since then is nothing short of astonishing. While there is no substitute for subject matter expertise, providing employees with the next generation of tools is paramount. Taking advantage of continued advancements in generative-AI and machine learning requires having a strategy with regard to data accessibility, governance and oversight. A sound strategy regarding data hygiene has never been more critical while modernizing a firm’s technology infrastructure. 2025 will mark a critical turning point as mounting fee pressures, evolving investor demands, and regulatory changes force firms to grapple with the total-cost-of-ownership and wanting to do more with their data.
Looking ahead, the winners in 2025 will be asset managers who embrace fully integrated SaaS platforms that can support any asset class and investment strategy from front to back. These solutions will enable firms to rapidly scale new products like direct indexing and ETFs, as well as leverage new innovative solutions like AI, while maintaining the flexibility to adapt to emerging market opportunities. The ability to pivot quickly and scale efficiently as a result of SaaS deployment will become not just a competitive advantage, but a necessity for survival in an increasingly dynamic market landscape.
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About Enfusion
Enfusion’s investment management software-as-a-service (SaaS) platform removes traditional information boundaries, uniting front-, middle- and back-office teams on one cloud-native system. Through its software, analytics, and middle/back-office managed services, Enfusion creates enterprise-wide cultures of real-time, data-driven intelligence, boosting agility, and powering growth. Enfusion partners with over 850 investment managers from 9 global offices spanning four continents.
