Our chairman, Kevin Houstoun, caught up with Fintech Finance TV at the FIX Trading Community Conference to discuss FGPA solutions, electronic trading processes and where the future direction of the industry lies.
We’re speaking to Kevin Houstoun, Chairman and Owner at Rapid Addition about the event, background on their company, challenges in the industry and much more! So Kevin, can you tell us what brings you to the conference?
Well, we’re a software vendor and we sell a lot of our software to banks and asset managers who are here today, so we’re here seeing some of our customers, catching up with some old friends and generally enjoying the community that FPL do a brilliant job of bringing together at these events.
Can you tell us a bit about what you do?
Rapid Addition manufacture a platform that can host any electronic trading process. We do things like market-side connectivity, customer connectivity; we provide a framework that you can build any electronic trading process in.
For example, some of our customers use us for sponsored access, so they do their risk checks and we provide them with very high-speed market access.
Other customers use our platform to integrate and glue together lots of disparate systems around their organisation.
Some use us for building smart order routers; we’ve got clients using us operating internalisation projects – just a million different things.
What we don’t do is almost as important as what we do, do.
We don’t do the intellectual property that differentiates one of our clients from another; we don’t write the actual algos; we don’t write the smart order routers, etc.
Client support, no competition with your clients, I understand. Can you tell us what challenges you see in the industry currently and how you are meeting those challenges?
I think one of the biggest challenges is as the industry has become more and more competitive, the banks and the asset managers we are dealing with have got an increasing focus on total cost of ownership, Return on Investment and cost income ratios, and IT is a very very large part of those costs.
What we’re doing is we’re providing a platform that can take some of those costs and amortize them across numerous clients.
We’re helping with that particular problem.
We’re able to lower those costs for banks.
So essentially those banks are able to outsource infrastructure to you?
Essentially outsource, but not in the conventional sense of the word ‘outsourcing’.
For example, we spent 20-man years building an FGPA solution for ultra-low latency access to various markets.
If a single bank had done that, they would have to pay for those 20-man years for their development staff. We’re able to sell it to them for a fraction of that cost because we’ve got multiple customers.
What else can you see happening in the next few years around the development of your industry?
I think we’re going to see more and more electronification. We’re going to see an increasing focus on the fixed income processes – improving and refining – people. And really starting to get to grips with how you find liquidity in those often-illiquid instruments.
Want to find out more?
We are the developers of one of the first commercial FIX engines.
Our product offering now extends way beyond just a FIX engine as we provide our clients with a total electronic trading systems and infrastructure.
However, our high performing, robust, and stable FIX engine remains at its heart.