INTERVIEW 🎙️ Tim Baker of Expero, discussing the "Modern" Financial Desktop
Channel: Beryl Elites
Date: 2023-12-19

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Tim Baker,  Managing Director,  Expero 
Lindsey L. Miller, Performing Artist & Producer

What are the big trends you are seeing in the financial desktop space?
 ❖ "The trends have been going on for a while actually. When you think about the financial desktop, I think about a Bloomberg or a FactSet workstation and all of those big vendors have been buying up companies and assets. So, there's been a lot of consolidation in the market and there's just a lot less choice out there outside of those big vendors. So, if you want to be able to get access to data, you're probably having to kind of fend for yourself and source that data, pull it into Excel. A lot of PMs and analysts are having to use lots of different applications outside that. So, they're using Excel or they're using their CRM platform or they're using Salesforce, if they're on the sales side. A lot of products are kind of disconnected. On the data side a lot more data companies are trying to get their data into workflows outside of those big desk products."

Where will Gen AI have the biggest impact on investment process?
❖ "It is having an impact already. As far as the investment process is concerned, you're
already seeing productivity gains. Traditionally, a PM or an analyst would have to go out
and read a lot of content when they're covering a company. They'd have to sift through years of filings, keep track of news content, be on earnings calls and because of all of that, an analyst could only cover 10-15-20 companies. Gen AI is already allowing those analysts to cover a lot more ground, so you can use Gen AI, for example to read quite lengthy documents like filings for you and summarize those documents. Another area of change, traditionally the way that you interact with data is through Excel or if you're a quant maybe using Python and you're writing code to analyze data and it takes quite a lot of work to get access to insights from that data.  We're already seeing use cases where you can basically ask a chatbot to look at some data and it will analyze it for you. You can ask it to do certain regressions on the data, ChatGTP 4 you can show it a chart and say, make observations about that image. So, you're going to see a lot more analytics being built into solutions that are driven the front end by a chatbot which I think is going to be very democratizing.

Following up on that, in the field of desktop software, how do you see AI affecting the employment landscape?
❖ Ultimately, it's going to have a big change. It is going to be a big productivity boost for the industry. Just across financial services they reckon about 75% of activities are very manual, require a lot of human intervention, it's copying and pasting, going through filings and a lot of those activities will be automated. It might take a few years for that to flush through the system but that's where a lot of the embedded AI solutions from firms like Microsoft. You're going to be instead of having a junior analyst building an investor deck for you, you as a banker will be able to basically ask PowerPoint to do that for you, and it will reach into all your internal data sources and create a beautiful deck.  So, I think it's going change the role of junior people as they come into a firm as typically, they would be doing a lot of those kind of manual grunt type of things, the software is going to enable that I think. The flip side of this, it's going to allow those individuals to do higher order activities sooner. So, instead of them having to collect a lot of information and read through documents, they're going to be able to participate more in the investment process, more in the value creation process.

Do you think they'll have to get more education then?
❖ In a way, they might need less. I think they're going to need to know how to use the tools. So right now, to get the most out of these Gen AI tools, you need to be able to prompt it. It's a bit like the early days of the internet. If you didn't know how to create a search phrase, you get the wrong results. So, Gen AI today requires a lot of what they call prompt engineering, so you have to keep asking a question and then asking for the results to be rendered to capture some other concept or idea. Now over time, the systems will do that prompt engineering for you. But I do think that individuals are going to have to become much more aware of how to create or to use these co-pilots or these chatbots. But also to know and understand the pitfalls because the worst thing is we all rely on this stuff and it's very important to have a human in the loop. Because they will hallucinate, there might be some unusual outcomes because they've been trained on all of the stuff on the internet, and we know that that's not always a reliable source.