Denmark-based Hemonto has now opened its first overseas office in Oslo.
Hemonto helps investors with more than EUR 26 billion in assets to gain an overview of costs, risk and other quantifiable building blocks of an investment portfolio.
The investment watchdog has hired Magnus Smedaas Hoff-Johnson, whose official title is Country Manager, to spearhead the hub. The Norwegian has joined the company from a position as general manager at wealth advisory firm Forvaltningshuset, and has previously worked in equity and derivatives sales at several Norwegian firms.
"We have chosen Magnus to spearhead our Norwegian office as we needed someone with local expertise who knows the market," Hemonto CEO Ken Gamskjær says to AMWatch, adding that the company is looking to hire another senior advisor to accompany Hoff-Johnson in Oslo as Hemonto plans to be in market for the long run.
Client feedback
AMWatch met Gamskjær and the new country manager at Hemonto's offices north of Copenhagen. As well as making several onboarding trips to Denmark, Hoff-Johnson has already met with the first potential clients in Oslo.
"I need to meet potential clients frequently to receive feedback and ask whether we need to tweak our platform to accommodate the market," he says, adding that there is already a lot of interest for this type of platform among Norwegian family offices.
"I have 15 years of experience from the Norwegian financial industry and have never come across a similar platform that monitors investment portfolios with this degree of sophistication," Hoff-Johnson explains.
"The fact that data is becoming increasingly important in portfolio construction and risk management within wealth management makes Hemonto an interesting company for providing critical insights for Norwegian investors."
Growing family fortunes
According to Gamskjær, the ambition to expand outside the Danish home market has existed for years and the initial groundwork to put it into action was done in 2018, when the company started to do market analysis of potential markets to enter.
"We found the Norwegian market interesting because there's strong growth within family offices, and growing interest in services like the ones that Hemonto provides," he says.
The market analysis was conducted by Pernille Crone Mortensen, executive strategy manager at Hemonto, alongside external consultancies and contacts and advisors to several of the larger Nordic family offices.
"Our analysis shows that Norwegian family offices invest with many asset managers, which requires monitoring and an overview of investments," Gamskjær says, adding that people familiar with the Norwegian financial industry have confirmed the product’s relevance in the Norwegian market.
When asked whether expanding to more Scandinavian countries is already in the cards, Gamskjær replies that the rest of the Nordic countries are also interesting for Hemonto.
"We would, however, like to start with one market and see whether we can succeed. We don't need to make hasty decisions. This is also why we have decided to invest in a new office and two full time employees because we think we can succeed in Norway, if we do it properly," Gamskjær concludes.
Increasing complexity
The hunt for yield outside of stocks and bonds has caused investors to spread their investments across more asset classes and, in some cases, more asset managers. This increasing complexity has been the business case for Hemonto since it was founded in 2006.
Even though financial reporting is increasingly generated automatically, the number of mistakes, such as investors paying incorrect trading costs, has not changed significantly, according to Gamskjær.
"We didn't witness a decrease in 2019 compared to 2018," he says. "Many asset managers are currently overhauling their IT systems, which can cause minor mistakes. We support our clients by engaging with asset managers to uncover mistakes and correct them," he says, adding that the asset managers are important stakeholders as they are, ultimately, the ones creating returns for Hemonto's clients.
The price for using Hemonto's platform depends on the complexity of the client's needs and portfolio.
"Every time we approach an asset manager, our starting point is that we have made a mistake. We therefore always ask questions for clarification in case we have missed something," he says, adding that Hemonto does make a mistake from time to time and that when this happens, it is important not to point fingers. He believes this approach is appreciated by clients' asset managers.
This post originally appeared on AM Watch.
