In this episode of the Fintech Focus podcast, we look at how research management software is upending the world of investing through a user-friendly, data-driven approach.

Mackey Research Management Software, started up by experts in the world of hedge funds, was brought to life to hit one major goal: to break apart a one-size-fits-all consumer application option for research management software (RMS) by harnessing the power of usability in a service that desperately needed some updating.

We speak with the company’s CEO, Chris Mackey, about software development and its role in working with investment professionals.

Speaker 1: 00:02 Welcome to Benzinga’s Fintech Focus Podcast. Your weekly dive into the world of Fintech featuring conversations with leaders on the front lines of the financial revolution.

Spencer Israel: 00:17 Hey everyone, welcome to episode 15 of Benzinga’s Fintech Focus Podcast. Spencer Israel here with you and I’ve got a good one for you today. You know, we try to spread the love around Fintech with this podcast. We try to hit on as many different industries, as many different types of people as we can. On this episode we’re joined by Chris Mackey. He is a CEO of MackeyRMS which is a research management software. If you’re not familiar with that lingo, essentially a research platform for investment professionals.

Spencer Israel: 00:49 It’s a relatively niche industry compared to the other areas of Fintech we’ve had represented on this show. It’s not as big as payments or lending but it is well established and Chris has basically bootstrapped his way into this industry and taken on big names like Bloomberg and FactSet. So this is an interview we actually conducted, Spencer White conducted actually when he was still here and he had some last minute travel which is why he conducted this interview over the phone but great interview nonetheless.

Spencer Israel: 01:18 Chris is a really thoughtful guy and offers great insight on what it’s like to essentially do it yourself. They’re not a VC backed company and like I said, it’s bootstrapped so Chris has some really good insights that I’m excited to share with you. So with that said, here’s our interview with Chris Mackey the CEO of MackeyRMS.

Spencer White: 01:43 All right, well everyone, thank you for tuning into this Fintech Focus podcast. We’re here with Chris Mackey founder of MackeyRMS. Welcome to the podcast.

Chris Mackey: 01:53 Thanks, Spencer. Appreciate you having me.

Spencer White: 01:56 Sweet. We’re glad to have you. So research in the capital market space is sorely needed and it’s a huge, huge market. There’s lots of different products and product suites addressing this need. Do you want to tell us a little bit about your background in this space and what MackeyRMS really does?

Chris Mackey: 02:18 Sure, absolutely. So quick background. I got out of undergrad in 2006 prior to the collapse of the housing market when firms were still hiring at full tilt and ended up working for a primary research group in New York that did a lot of work with institutional investment managers. From there I was introduced to a Boston based hedge fund where I was later hired as a research analyst covering technology companies and during my time as an analyst I noticed a lot of technological inefficiencies in terms of the products we were using to manage our work flow and we were really jumping through a lot of hoops in order to provide our portfolio managers and our compliance officers with all of the information they required to do their jobs effectively.

Chris Mackey: 03:08 Admittedly I was never too passionate about my work as an analyst but one of the great things about the job was that as an institutional investor I got a ton of face time with founder and C level executives from the technology firms that I was covering. Their excitement was really contagious. During this time in my life I really got the itch to branch out on my own and start my own company and just couldn’t shake this idea that there was going to be a need for a more modern and mobile research management platform.

Chris Mackey: 03:42 At this point, it’s 2010. The iPad had just come to market. You were seeing it pop up left and right at investor conferences and people were really using it to help manage their workflow but at the end of the day they were still a lot of disparate applications that people were managing or sorry, using to manage that content. So in early 2011, I took the plunge. Started MackeyRMS and RMS stands for Research Management Software which is an acronym in our space that’s as well known as CRM. Set out to build, like I said, a more modern, a more mobile, a more user friendly research management platform for the buy side.

Chris Mackey: 04:25 Was lucky enough to come into contact with my two technical co-founders Dan and Hoony who are still with me today and we set out to build that platform. Today we’re still 100% employee owned. We’ve never taken a cent out outside capital and we’ve been profitable every year since inception. The product that we were able to build really struck a chord. We’ve now got a team of 20 with offices in New York, London and Boston which is where we’re headquartered and we’re working with end-users in over 30 countries who collectively manage about two trillion in assets under management.

Spencer White: 05:05 Wow. Well, congrats on that success. It’s interesting you sort of caught the bug from the tech industry. That’s something I don’t think I actually have … we have lots of folks who were on this podcast who were in an institution and then sort of jumped ship but they always seem to tell us this entrepreneurial spirit was burning inside me the whole time. It’s interesting that you see it as infectious. So something Spencer Israel and I we’ve been discussing as we were preparing for this interview, we read and digest a lot of analyst notes in our coverage of the markets here at Benzinga but we don’t really know a ton about how the sausage is made. What is the RMS market like? We’re very curious about that. What’s your competition? What’s unique about your product suite? What makes a good RMS stand out in this market?

Chris Mackey: 06:02 Sure, so there were some legacy providers that came before us which was a nice thing as we were getting into the industry because we were dealing with an educated market. The concept was not new to people. SS&C, Advent has a product, FactSet has an offering, Bloomberg has an offering. So really when you’re looking at our three primary competitors, those guys did collectively 12 billion in sales last year. You’re talking about companies with a tremendous amount of resources at their disposal. We always felt on our end as if there was really a need for more of a stand alone product that would focus first and foremost on the core kind of nuts and bolts of research management.

Chris Mackey: 06:53 So notetaking functionality, the ability to work alongside and integrate with other applications and devices for document storage and sharing and things of that nature. So we felt like there was a need for a stand alone kind of pure play RMS in the market. When we first broke into the space, you know, bootstrap startup, no backing whatsoever. Nobody had heard of me. They had no reason to take us seriously unless the product was quite good. The way that we were able to really differentiate … well, we did so in a few different ways.

Chris Mackey: 07:37 Usability. First and foremost we wanted to create a modern platform that was highly usable. If you log into our system and you know how to navigate a LinkedIn page or a Facebook page, chances are you’re not going to require a whole lot of training for our platform. Then beyond that we were really bending over backwards to offer a high degree of mobility and usability. Going back to what I was saying around the timing of our launch the iPad and the iPhone were relatively new inventions.

Chris Mackey: 08:07 They were really changing the requirements that the modern analyst had from a mobility standpoint and an accessibility standpoint. So we really try to hang our hats on our mobility offering and then beyond that we are also able to win business due to automation. We can tap into a lot of different data sources, we don’t force as much behavior change as some of our competitors because we’re willing to integrate with more apps and devices than anyone else under the sun.

Spencer White: 08:42 Got it, so what really closes these deals for you? Is it the inter-operability, the mobility or is it just sort of the boots on the ground analyst being like, “This makes my life so much easier.” What have you found is the big problem it solves? There’s a lot of features but what’s the common thread in all of the deals you close?

Chris Mackey: 09:06 Sure, the common thread is absolutely the fact that we don’t require the process change that most products would require in order to be effective. We understand that many analysts throughout the buy side are set in their ways. They have applications they’re comfortable with and a process that works for them. Because of our automation, because of our ability to integrate with all of these different processes, we’re not going to require that same process change and our end users absolutely appreciate that.

Chris Mackey: 09:36 Then by extension, because we’re getting more immediate buy in due to our integrations and our automation, you’re always going to be dealing with a more complete and a more real time data set for the portfolio manager and for the compliance team. It’s really a win-win for everyone across the board.

Spencer White: 09:55 Got it. So seeing the other startups closing deals and growing and scaling, why didn’t you want to take outside funding? When you were bitten by that entrepreneurial bug was … A lot of the tech companies you were probably talking to were VC fueled and figured out the business part later. But you’ve been consistently profitable. Why take that approach?

Chris Mackey: 10:20 Sure, it’s a really good question. When I started out it’s not as if I was completely married to the idea of bootstrapping a company and I certainly wasn’t adamantly opposed to raising outside funding. For me, the natural first step in starting the business was to focus on the product. I just had a desire to build a great product. I was confident that people would respond to it and a funny thing happened once we finished working on our prototype. We went out and started to show it to prospects on the buy side and people responded to it.

Chris Mackey: 11:08 Soon enough and kind of just before we ran out of cash we were lucky enough to start signing clients and that revenue really has funded the business ever since. Again, I don’t think that we were opposed to outside funding. We didn’t have these grand aspirations of bootstrapping forever but I think the timing was right for our product. The market really responded to it and the other thing that you need to keep in mind is we’re serving a relatively niche market.

Chris Mackey: 11:41 Not only are we selling into investment management firms, but by and large we’re selling into investment management firms that do a lot of deep dive fundamental research and that typically have about a billion in assets or more. We knew who our potential clients were. We were selling into a well defined market. As I mentioned earlier it was a market that was really already educated on the concept of what we were doing and so at that point the only thing left for us to do was get out there and hustle and get in front of these folks and sell them on our ideas and on our product.

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Spencer White: 13:17 About taking a product on the road, you mentioned that your co-founders are the more technical ones. It sounds like you have a good handle on what the problem the product solved. How do you as a founder with the vision but relying on a team to execute, how do you manage your role as shaping the product and then selling it?

Chris Mackey: 13:41 Sure. Working with two phenomenal technical co-founders since day one, my role within the organization in addition to kind of running the business side of things has always been Chief Product Manager. I’ve been in that buy side seat. I understand and appreciate the pain points that we’re trying to solve for and I’ve worked closely with our technical team really since day one to communicate those pain points and to troubleshoot them along the way. So my role in the organization again is Chief Product Manager. I am the person who most often is driving the demos that we’ll do with prospects and a lot of the meetings that we’re in troubleshooting with clients. I think that’s where I’ve been able to really add a lot of value just based on my experience on the buy side.

Spencer White: 14:36 Great, great. So one thing we really like to hear from folks, especially who are hands on leaders like yourself is what advice would you tell other Fintech founders who have identified a niche need and a niche problem and wanted to solve it. What are some general thoughts on how to attack that?

Chris Mackey: 15:01 Sure. I definitely suggest sticking to one or two core competencies in order to prove your concept. So many fintech firms try to do too much out of the gate. We certainly made that mistake early on and I see it all the time in our niche. Companies with amazing technology straying out of their lane and they get creamed by bigger firms. You need to recognize that you really don’t need to solve all problems for all people to turn a profit but if you’re able to stick with the things you’re good at, your one or two core competencies, you’re going to have a fighting chance to be successful in the fintech space.

Chris Mackey: 15:40 Another area where I would offer a little bit of advice is, I would say you should really try to ignore the noise. Maintain a razor focus on your product. Listen to your clients and your prospects because their feedback is going to be invaluable. Every company is different and only the entrepreneur can decide whether or not raising outside capital is the best thing for them. But a simple fact is that today’s media spends too much time and energy covering fundraising rounds and VC investments. You really need to zone all of that out. Worry about what’s best for your business and go about building something that’s sustainable.

Spencer White: 16:23 I’ll be the first to say I’m guilty of covering fundraisers, but hey, they get the clicks. But to redirect here, so as you reflect on how to solve these problems, what’s the biggest need you’ve discovered about your customer base? Obviously, I imagine in the time between the mid-2000s and now the way analysts work on the buy side has changed, the way they go about their day has changed. Have those needs evolved and what have you learned about those evolving needs?

Chris Mackey: 17:01 Sure. It’s a very good question. One of the biggest changes that I’ve recognized is the fact that mobility has really come to be viewed as more of a right than a privilege. Software providers that are serving the investment enterprise need to recognize that. So that’s why we have really gone out of our way to provide the most mobile solution possible within the investment management space and within the RMS niche. Our clients have responded to that. They appreciate that, but at the same time, you need to be mindful of data security and things of that nature as well.

Spencer White: 17:42 Interesting. I want to throw a forward looking question in here. Something that always piques my interest in these interviews, you mentioned you have a niche market. Sometimes when you target a really specific crowd within a niche market you can top out. You don’t always see this but you can … I’ve interviewed folks who have said, “We’ve gotten all the business we need to in this particular space and then we’re moving on.” Do you see that happening for Mackey? If so, what would you do after? Would you expand the product? Would you look for an exit? Do you look at the end game like that?

Chris Mackey: 18:25 I mean, first off I try to follow my own advice, right? We really have a laser focus on our product and we spend a lot of time listening to our clients and listening to our products about their need. Our platform has certainly evolved since we launched the company back in 2011. At the time, I think there was an idea that it was going to be a little bit more of a compliance type platform. Although that’s certainly one of the strengths of the platform, the ability to see what’s happening within your firm in real time from a compliance standpoint, what’s happened is it has really become more of an efficiency tool for the investment enterprise.

Chris Mackey: 19:06 You constantly need to be listening to your customers because they’re going to tell you where you should be going with the platform. I’m really excited about where we stand and how we’re positioned within the RMS space. I think we’ve done a very nice job over the years of building a smart tool for managing data and moving forward I’m really excited about the possibility of being able to tell our clients a lot more about their data that’s sitting within our platform.

Chris Mackey: 19:36 I think through more advanced AI and analytics type functionality we can just tell them a lot more about how their analysts are spending their day and whether or not they’re spending their day wisely. Really excited about the functionality that we can offer from an analytic standpoint and I think that layering that onto kind of the core platform that we’ve built today will be in fact impactful for everyone.

Spencer White: 20:08 Your question about efficiency ties really well into something that Spencer and I were talking about. There’s lots of talk about automation and efficiency in this industry. Some predict the role of analysts on different sides of the buy and sell side might go away as automation and efficiency increase. How does that affect what MackeyRMS does? Is automation a material threat to what you’re doing?

Chris Mackey: 20:40 That’s a really good question. I think that in the niche we play in, automation is always going to be a big benefit to the investment management industry. By allowing people to deal with more complete and real time data sets when it comes to their internal and proprietary research and content, we’re allowing them to really play with a full deck. Automation, just looking back over the last couple of years there have been plenty of headlines calling for the demise of active fund management.

Chris Mackey: 21:17 Wherever you go you’ll see headlines about how the quants are taking over and things of that nature. I think the calls for the demise of active management have been premature. I think that certainly over the last couple of years, the performance of our clients and the performance of active managers all over the world back up that claim. I think automation, especially from where we sit, automation is something that can only help the active manager moving forward.

Spencer White: 21:56 Great. So to wrap it up, what’s next for MackeyRMS? What is the rest of 2018 hold and do you have anything you’d want to tease? Big announcements or clients you’re interested to tout?

Chris Mackey: 22:14 Sure. That’s a really good question. From a business standpoint, we’ll continue to invest in our people and all of the markets we sell into. North America is our biggest market at the moment but we’ve got tremendous momentum in Asia and some of our largest customers are in Europe. We’ll certainly look to those markets for potential investment. Although we’re certainly committed to remaining 100% employee owned at the moment, that could always change if and when our clients needs dictate. We never say never.

Spencer White: 22:42 Great. And then the last hidden bonus question we always throw in, what keeps you up at night? As someone who’s running a company, trying to scale, what worries you and how do you deal with that?

Chris Mackey: 22:58 That’s a really good question. For me it’s making sure that I’m the best manager I can possibly be at scale. We’ve come a long way in the last few years. We’ve grown our team, we’ve grown our client roster, we’re expanding our global footprint. The issues you face daily when you’re supporting end users in over 30 countries are a lot different than the early days when you’re managing a handful of accounts in your own hometown or state or region. For me that would be the would be the biggest thing that I worry about and that I think about and that I prepare for.

Spencer White: 23:44 Well, Chris, thank you so much for the time. This was a lot of fun. Really, thank you so much for the time today and for the thoughtful answers.

Chris Mackey: 23:52 Thanks for having me, Spencer. Appreciate it.

Spencer Israel: 23:57 All right, that was our chat with Chris Mackey, the CEO of MackeyRMS. Hope you guys enjoyed it. If you did, please leave us a review. We are of course on a number of platforms. This podcast is on iTunes, it’s on Google podcast, it’s on Stitcher, Spotify, TuneIn, Audioboom, Player FM. So please show us the love there. You can also subscribe to the Fintech Focus newsletter by going to and clicking subscribe on the top right hand side of the page. Thank you very much to Chris Mackey for joining us today. Again, hope you guys enjoyed it and we’ll see you next time on the Fintech Focus Podcast.