Since founding RiskCap in 2013, CEO Dr Paul Magro has seen it go from strength to strength, building upon the services it provides to firms operating in the financial services industry around the world. Today, he leads a team of experts based out of the company’s offices in Malta and London, navigating the changing landscape of regulations and industry requirements to help evolve the way governance, risk, and compliance are managed.
Describing his role as a multi-faceted one, CEO Paul Magro explains that, due to RiskCap’s nature as a consultancy and professional services firm, he is not only responsible for managing the company internally, but is also on the frontline, dealing with clients on a daily basis. “It’s about having your fingers in every pie – dealing with in-house matters and helping your clients at the same time,” he smiles.
With over 10 years’ experience in the financial services industry, Paul founded RiskCap, together with his partners, in 2013, in what he describes as his first step into the entrepreneurial world. In fact, the CEO considers his primary career landmarks to be intrinsically tied to the business.
“Apart from obtaining my PhD, my main achievements are associated with growing the company – building various teams within it, and focusing on the areas of risk management, compliance and corporate services, in order to support our clients,” he asserts, also noting the significance of several awards and recognition that RiskCap has achieved over the years, among them service awards in 2018, and a young entrepreneur award won by Paul himself.
He also counts building successful teams and opening an office in London among his achievements, as well as reaching milestones in relation to the number of clients they work with. In fact, the best part of it all, he admits, is “seeing that our clients are happy and satisfied with our work, so much so that they recommend us to other firms that need support in the areas we work in.”
On the flip side, the work RiskCap does also comes with its challenges. That said, the CEO maintains, the challenges are akin to those that everyone involved in the financial industry faces, including regulatory changes and adopting IT when it comes to providing services to help with those requirements. “Compliance has not traditionally been associated with IT, so navigating how it is incorporated within that system can be a challenge. We are always looking to develop internal systems to help us be more efficient in dealing with clients’ needs,” Paul describes.
Looking back on the history of RiskCap, the CEO explains that, when the company was set up in 2013, its original aim was to provide risk management services to Fund Managers that were going to be regulated under the Alternative Investment Fund Directive – a directive that was being released at the same time. “Given that Malta didn’t have the resources for companies to require full-time Risk Managers, RiskCap was providing a service that would help them with their regulatory requirements,” he says.
And as the years went by, RiskCap branched out into other areas, going into compliance, AML, and providing directorships related to corporate services, Paul continues. He also notes that “while risk management is still our core business, over the years we’ve spread out and offer these diverse services to our clients.”
In that time, the industry has also changed quite a bit, the CEO affirms. “Clients are becoming much more knowledgeable in terms of expectations from regulators. Now, not only does that help us, but it also increases the demand on what our clients expect from us,” he explains. Whereas Paul admits that,
in the past, the company would receive very little feedback from clients on risk management reports, over the years, they’ve started seeing new clients increasingly get back to them with feedback, ask questions and request further information to help them with their day-to-day decision-making. “There’s been a gradual shift and clients have begun to see us as an integral part of their firm.”
Speaking about what differentiates RiskCap from other companies offering similar services, Paul says that, from day one, IT has always played a significant role. “We use some of the most advanced systems available to provide our services to our clients, such as having MSCI, a leader, as a strategic partner, when it comes to risk analytics and reporting (eg market, liquidity, counterparty and now ESG). MSCI is a recognised name, so, when clients ask what systems we use, they’re already aware of them and are often impressed. That’s one of the key differentiations between ourselves and similar firms – our systems are really considered among the top in our industry,” he maintains.
The other major element that distinguishes RiskCap is its culture and people. “We ensure that our team are experts in their roles. Besides myself, our Head of Risk and Head of Compliance Services – key individuals in the firm – are well recognised within the industry and by the MFSA. These key people help us to provide the quality of service that we expect,” the CEO states.
It is this strong framework, with the infrastructure to back it up, that supported RiskCap when the pandemic first hit. Within the company, Paul says that certain contingencies were already in place, enabling the team to easily work remotely if needed. That said, he admits that, at the time, the majority of employees were not working from home. “Still, we knew that we could make the switch if we needed to,” he explains, affirming that, upon seeing everyone work from home during COVID-19, and with the work continuously meeting deadlines, “we’ve taken the decision to allow this hybrid method to continue going forward.”
On the part of their clients that invest in the financial market, the CEO admits that the team witnessed the initial negative impact at the outset of the pandemic. “Some of our smaller clients obviously felt the pinch even more when the markets dropped, and we did have some that had to close up shop. But we also have many others that have weathered the storm, and are now bigger and better than they were before.”
And while the CEO doesn’t consider the pandemic to have created major opportunities, it has allowed RiskCap to consolidate. The biggest opportunity, however, was being acquired by AK Jensen Group, a leading provider of turnkey trading and infrastructure solutions for Fund Managers.
As for RiskCap’s office in London, the CEO posits, “since opening, we’ve experienced both Brexit and COVID-19, so we have faced challenges but have managed to build the foundations, for which we see 2022 as the opportunity to continue to cement our place.”
In fact, 2022 is looking bright for the firm. The acquisition by AKJ Group will certainly add a new dimension. Paul explains, “the Group see us as a natural fit for their ever-growing ecosystem, adding a professional services and consultancy firm to service various firms and legal structures that the Group has and will set up.” Also, Paul continues, “it is an opportunity to plan the time to refresh our client experience and brand messaging. Working alongside AKJ Group, we will challenge ourselves to explore unlikely alignments and work with firms that share our vision or a cause we are passionate about.”
As a result of the acquisition, the CEO continues, “this year, we’ll be working on the natural synergies between the Group and on continuing to grow RiskCap, not just in Malta but on an international scale.”
Moving forward, Paul affirms that the biggest opportunities lie with the creation of new services due to regulatory requirements and new sectors, such as blockchain and crypto within the financial services sector, attracting new clients, meeting with people again, and being able to drive the business development side further. “I’m looking forward to all the opportunities that come with those interactions with people once again,” he smiles.
Paul is focused and motivated for the months and year ahead, listing an ambitious set of deliverables. “2021 felt like an unwelcome extension of the struggles of 2020. The challenge of hiring remains industry agnostic. However, our future success will be driven by how we can implement IT across all of our service areas. I plan to ensure that with the right IT we will deliver on more success. Furthermore, my goal is to continue to bring in business for the company across the board and to maximise the integration between RiskCap and AKJ Group as we look to grow internationally and push our plans forward throughout the year.”
This article is part of the serialisation of 50 interviews featured in MaltaCEOs 2022 – an annual high-end publication bringing together some of the country’s most influential business leaders.
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