Eze Castle Integration, a provider of strategic IT solutions and private cloud services to hedge funds announced this month that it was to expand its Eze Private Cloud services to Hong Kong and Singapore. In an interview with Asia Pacific Intelligence, Serge Bukhar, executive director of international operations, explained that many Asian hedge funds keep their infrastructure quite confined. "They don't want to make a big investment into infrastructure and the facilities such as office space don't allow them the space for infrastructure so it's a logical solution to outsource to a cloud solution," he said.
The firm has a global strategy of expanding their cloud to cover larger global firms and to use it in multiple offices. "In Asia, we primarily have offices in Singapore and Hong Kong as they are the hedge fund capitals in this region," Bukhar said. "The industry is not in the best shape ever, smaller funds are struggling and potentially shutting down. The opportunity to transition IT costs from capex to opex with cloud computing is quite appealing."
Bukhar finds that local Asian hedge funds are often smaller and due diligence requirements are lower in Asia than elsewhere. "In the US or the UK we usually see a dedicated compliance officer, but we rarely see that in Asia where the roles are done by one person wearing multiple hats. They are more cost conscious and don't want those dedicated salaried positions."
However, Bukhar feels that it is changing as more institutional money comes to Asia and more second and third generation hedge funds are opening up. "Originally, it was a large US or UK hedge fund opening in Asia and if they were successful then the managers spun out and created their own firm. Now there are more generations of independent managers, working for themselves and not reporting back to the west," he says.
This article was published in Opalesque's Asia Pacific Intelligence our monthly research update on alternative investments in the Asia-Pacific region.