iCapital on UBS On-Air: Conversations with Jeremy Langlois, Managing Director, Data Solutions

Jeremy grew up playing hockey and after completing a graduate degree in finance, was signed to play professionally. In his first off-season, he had an internship at a private equity firm, where he had a mentor who not only gave him a great knowledge base in new issues and debt deals, but also encouraged him to think about the future and how technology was developing.

Jeremy injured his hip during his second pro-hockey season and while doing rehab, started thinking more about the intersection of technology and finance. During this period, he met Mirador CEO and co-founder Joe Larizza, who at the time only had a rough business plan. They decided to develop Mirador together—even with Jeremy continuing to play hockey during the initial years.

Highlights of their conversation include:

• The value of consolidated reporting and data mining for decision-making
• Ways family offices engage with reporting data
• When outsourcing makes sense
• The art and science of reporting
• How the industry is evolving to meet increasing needs

Excerpt

Kristen: Jeremy, could fill us in on how Mirador/iCapital developed from your first meeting with Joe Larizza?

Jeremy: Our first client was a multibillion-dollar global family office based in Connecticut serving a family with four generations. We were tracking everything from liquid cash equities to fixed income, to alternatives, private equity, hedge funds and direct investments. The reporting platform we built still operates on Addapar. We really worked to establish ourselves as the experts when it came to consolidated reporting and acting as an extension of our firms and our families while advocating for these performance reporting systems.

We steadily built Mirador over a decade to service family offices as well as larger wealth managers. Then in May of 2024, we were acquired by iCapital, which has been very synergistic for both companies. iCapital is the leading alts platform out there. They tech-enabled what had been very inefficient workflows for investing in alternatives. That said, there were cases where clients had alternatives outside of the core platform, and that’s the area that Mirador specialized in—tracking any asset no matter where it’s held. So now iCapital can work with our clients, wealth managers and families, tracking and aggregating assets all across any asset class.

Kristen: Thank you. Can you talk more about the problem that Mirador was addressing—the problem of staffing this function inside a family office and how it came to be?

Jeremy: Yes, the genesis was the demand for consolidated reporting. Joe’s prior firm was an independent wealth manager using one of the largest asset aggregation or data gathering tools available to provide consolidated reporting for families. The problem was that a family might have $50 million with that firm, but $100 million outside. The idea was to be able to offer consolidated reporting all on one platform through one firm. Many families at the time were receiving fragmented reporting across multiple institutions, so they had assets at one firm, but they were also going direct into private equity deals or real estate and had direct investments in art or wine. We were able to say we can take you from your legacy tools and Excel spreadsheets to a newer tool that can aggregate all of this data on a nightly basis, and we can track and manage all of the alternatives and hard-to-track assets, so that you can actually get a full picture of what you own on a real-time basis.

Kristen: What do you notice from family office clients that initially managed the consolidated reporting function in-house and then outsourced it?

Jeremy: Well, the question many family offices most ask is, “What are other family offices doing?” This question is usually followed by, “How do we know what is good reporting? Are we getting the most out of our reporting systems?” It goes back to asking them how they are handling their investments, whether they are leveraging firms like UBS and how they are handling the accounting/ tax side. What is their operating model internally? Do they have internal resources that are doing some of these activities or are they a virtual family office and leveraging other counter-parties to execute their work?

Obviously, we prefer to engage with families at the front end of selecting some of these tools. We get most of our clients coming in when they have already selected or are thinking about selecting the tool and are trying to figure out whether to outsource it or if we leverage iCapital data solutions to help operate the tool. Often clients come when they lose a key employee or subject matter expert who took the time to implement the system and then left, so the family office is panicking to figure out who can fill the seat. In some cases, it may be the president of the family office, or CIO, or CFO who is now tasked with data maintenance and a technology that they don’t know how to use, so they often struggle to get the most out of the system. At the end of the day, you do need dedicated expertise to run these reporting systems.

One of the things that I notice most about working with clients, is that they are managing the system as needed to run a monthly or quarterly report, but they’re not doing it daily. So, when they go to run their monthly report, they have a mountain of tasks that builds up and makes it very hard to efficiently run the business. I call it having good hygiene. Like brushing your teeth every morning, you need to check your data in the morning to make sure you’re getting everything out of the tool.

At the end of the day, most of these family offices deal with what I call the fractionalization issue. They have a need to build and operate these systems, but they may only need a half of a person, or three-quarters of a person or a person and a half. So, it’s a push-pull to get the resources they need at a given time.

When we engage with our families, we usually start with understanding the inputs of the data and the desired output, depending on who is going to need access to that data and information. Once we do that, they often want to see more and that’s the benefit of leveraging a third party that lives and breathes these systems on a day-to-day basis.

Kristen: What are some of the ways that family offices engage w/ this data? What have you found that is unique or surprising?

Jeremy: It depends on who you are asking within the family office. On the investments side, they want to look at timely returns and risk calculations that drive a lot of the performance and rebalancing. On the accounting side, they typically are looking for realized gain information, dividends, or distributions and rules that may be feeding general ledgers. Family members may want a monthly report or something to show the next generation their ownership that’s not a pooled trust. A trustee or board member may want to look at how investments are adhering to target allocations, what’s happening within the overall portfolio. We work with our clients to understand the dynamics and the operating models so that we can provide the appropriate outputs.

Most families end up having standardized monthly and quarterly reports that can be run at the click of a button on a variety of different levels. These reports are a mix of art and science, matching the demands of the consumer, but also making sure information is scalable and repeatable.

That’s the value of consolidated reporting—that you have those standardized report packages so that everyone can be speaking the same language when they sit down together as a group. When it comes to the future, the next gen is looking at portals and apps and the ability to customize that data where necessary to fit their needs. I think that as these trends continue, having people that understand the data as well as the dynamics of the family office is key.

There are new and unique ways for family offices to interact with this data. For example, we had a real estate family that started with us just looking at their investment portfolio. It was a second-generation family with a lot of joint ownership of different vehicles, investing across public and private assets as well as real estate. We had a single line item for each of the trusts and then added not only the value, but the liabilities, the debt and the cost to complete. They could see gross and net across each of the hundreds of properties that they own. Taking general ledger data, we could also show operating cash across all these different portfolios. So now they can see the joint ownership across all the entities as well as what percent the trust owns for each of the properties. The family office head commented that this was the first time that the trustees had a full picture with the weightings of all the underlying entities. This helped them make decisions about when to invest in the operating business versus continuing to deploy money to the public and private side. So that’s a great example of how families start in one place but are able to evolve over time in interesting ways.

We’re in a period of lots of volatility and this is usually where clients run a lot of reports. They want ad hoc reports that show performance on a daily or weekly basis. What do our terms look like? Where is my cash? How much cash do I have to deploy? When you have everything consolidated on one system and you are doing that daily hygiene, you can facilitate those requests in an easier manner. During times like this, we are seeing families using reporting in a unique way and keeping up to date information so they can be better prepared to make better decisions with that framework.

Kristen: There has been a lot of innovation and entrants into the consolidated reporting market in recent years. Where do you think the space is going?

Jeremy: There’s a ton of money being spent to track clients to grow wallet share. You have firms like Addapar that are spending $100 million a year on tech to improve the platform, so keeping up with the Joneses is increasingly more expensive. Given the costs, I think you will see more consolidation in the industry. But you must be smart about which tool and platform you’re going with and whether it has staying power for the next five plus years. You really want to take the time to select the right tool, so you don’t go through multiple implementations.

The silver bullet that every family office is looking for is to marry the performance reporting with the general ledger data in one platform, rather than trying to integrate multiple systems. When I talk to clients who are located in different jurisdictions, they’re still consuming their data from multiple sources.

I think when you look at how technology is evolving, AI is really shaking up the space and will continue to do so. It is easier than ever to build tech to attract data, to assist the tech team in translating data and prompting it with questions. I think the next layer for many of these platforms will be using AI to help the user and to help the platform grow and scale.

Kristen: Jeremy, before we leave today, is there anything else that you’d like to leave our listeners with?

Jeremy: For both advisors and families, you need to do your homework and speak with folks in the industry. Family offices are very dynamic. There’s understanding the technology, but more importantly, there is understanding the people and the actual business behind the family office to make sure you are meeting needs across both.

Listen to this podcast on ubs.com/inconversation