1679 – Uniquely Canadian with Infinite Investment Systems’ Ali Zahedi

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0:58With us right now, Ali Zahedi. Ali, you are the CEO at Infinite Investment Systems. You're found on the web at inf-systems.com. Ali, thank you so much for joining us. Pleasure to be here, Josh. Thank you. Absolutely. What do you do at Infinite Investment Systems? We provide systems and software to the financial industry, specifically to the wealth management industry in Canada. Yeah. Okay. Like doing what? What do they need that they don't have very well on their own? How do you improve their lives? Sure. So there's quite a few private wealth management firms that manage money either for wealthy individuals or institutions, and they need to have a system at the center of all their administrative and operational needs.

1:50that is what we provide so everything from tracking the clients for whom they're managing money how much they're managing what did they buy what did they sell what were the gains and losses the tax accounting so the core of it being portfolio accounting and then by extension modules that are necessary in order for these guys to service their clients so everything from measuring performance and doing comparative analysis doing trading and modeling and calculating fees and doing the client reporting and the regulatory reporting. That's what our company provides to about 90 private wealth management firms.

2:26We also work with some of the banks here in Canada, and we work with the bank itself in providing technology solutions to their wealth management groups. And we work in conjunction with the banks with their common clients that we have. Now, so Infinite Investment Systems has been around for quite a while. Do you want to just maybe just touch on like where you come from and kind of the legacy that you are? Yeah, absolutely. I'd be happy to. So we started in 2004. So we're coming up to 20 years now. And we started the company, myself and my partner, both of us have a technical background. I went to University of Toronto for software engineering.

3:10So we were, you know, a couple of geeks, if you will. And we started the business building systems for the industry. We both had prior experience in the industry and we knew that there's a lot of room to bring technology. And our first sort of mission was prior to us coming into the industry, most of the systems that were available were highly modular. So all those things that I talked about in terms of like the core portfolio accounting performance, compliance, trading, all these pieces were kind of little subsystems that you had to sign up for as a firm and then work all of these systems into your operations.

3:48So we built our application, which is called Harmony, as a fully integrated tool. And that's why we named it Harmony because it was this idea of Harmony of Feature and Functionality. And so we built an integrated solution. I don't want to say we're absolutely unique in doing that, but I would say we're one of the first ones in Canada to do that. And that was a pretty good proposition to take to these midsize wealth management firms because they needed the end-to-end application in order to run their business. And by coming to us, they could get sort of a one-stop shop, if you will, in terms of their technology and their core business.

4:28We grew the business completely organically. We were both very young when we started the business. We didn't know much about raising capital and managing those relationships. So we kept it purely organic and just tried to get out there and cold call and sell. And as we got a little bit of traction, hired some of my friends out of university to join us, all smart, brilliant people. And we sort of grew the business slowly from there. And just out of curiosity, are there any unique, you know, as an American, Are there any reasons that you've kind of stayed to the Canadian market? Are there any unique applications just based on regulations, law, that sort of thing, where, you know, you have maybe you solve issues or provide solutions that are uniquely Canadian?

5:22That's a great question. And yes, there are unique aspects to wealth management. First of all, as you pointed out, there's different regulatory requirements. We are, so you guys have the SEC down in the US. We have equivalents up here and there's regulations that we have to do accordingly. Also some core calculations, even things as basic as how do you track the cost of an investment? There's different methodologies. There's like first in, first out, last in, last out, average cost and whatnot. And these different methodologies mean different results when you're calculating gains and losses and subsequently filing for taxes and income and whatnot.

6:02So I'm somewhat oversimplifying it. If someone's an expert in the industry, it's more nuanced than what I'm mentioning. But but but there, yes, there are nuances to the industry that are specifically Canadian. Further, when you think about, you know, say, Josh, you've got$2 million that you're going to give to somebody to manage for you, that money is actually held in custody within a custodian. And a lot of times these custodians are banks. And so in Canada, you're dealing with a subset of firms that provide custody services. They don't necessarily have to be banks. There are other large institutions that provide custody services.

6:41and there's quite a few custody services down in the U.S. And so for every one of these relationships, we have to have a bit of an integration in place to do reconciliations of our data and their data and whatnot. And so for us having been in Canada for all these years, we've created very strong relationships within that ecosystem in the Canadian space. And if we go down into the U.S., we would have to sort of work on fostering those same relationships and also make sure that we have brought our system in line to deal with the different kinds of rules and regulations. And the last point is the easiest one, which is like down in the States, you guys have, let's say, your 401k account.

7:23Up here, we have various registered accounts for retirement and tax-free saving accounts and so on and so forth. So those different types of accounts and their inherent behavior when it comes to tax is also something that needs to be considered. And obviously, we have been focused on the Canadian market, recognizing that the U.S. is so much bigger. But the Canadian market has been big enough for us to stay in. And so we've built our home here for now. Yeah. I'm curious. So you have a very, what I would consider to be a mature platform. I mean, you're at this point, like you've got a great roster of clients that you're able to work with and support.

8:06what is operations like for you on a regular basis? Like what is a lot of just, are you doing customer support? Do you continue to develop and refine the program? Are there, you know, still a lot of, you know, very growth oriented activities happening? Yeah, absolutely. So we're constantly trying to bring on new clients and in order to bring them on the in conversion and the implementation process is actually quite involved. So we're constantly trying to get better at that onboarding process, but also adding features and functionality is on the go all the time. As you can imagine, our system being more mature means we need to do work to modernize it, you know, facelifts, user experiences, more connectivity.

8:51So there's always a lot of work that we need to do to keep the system relevant. And also we've been able to take on larger and larger institutions as clients up to and including, as I mentioned, banks. And so that brings in its own challenges because, you know, something that might be easy for a private firm, all of a sudden you get to a certain large institution and volume becomes a factor, something that may not have been an issue before. So there's definitely lots of things that we're doing every day. And we're very aggressive in wanting to grow the business. I mean, it took us a long time to get into a good position and establish ourselves in the industry.

9:28but to give you a good reference is when we went into the pandemic, we were about 17 people. And now we're about 57 people. Wow. And it's all been completely organic. And I'm sure you've heard that, you know, I think there's a common phrase around, you know, it takes 20 years to have overnight success or something to that effect. It took us a long time to build this business, to build the foundation, to build a very strong core of our generals internally. And then when the time was right and we were able to scale without even bringing any external investment, we were able to really grow rapidly and build teams around each one of our core individual team members.

10:10And the application was strong enough to be able to accommodate the new business and the new clients. And it's been quite a successful sort of growth trajectory. And we're looking at an even more aggressive growth over the next three to five years, hopefully. Yeah, that's exciting. So what do you do at this point? Because you're definitely a household name for that world, right? So if we're talking about Canadian firms, financial wealth managers, right? They all know you. So how do you continue to grow market share? Obviously, you're growing with markets, obviously. But aside from that, I'm just curious, what you do to keep deepening relationships, form new relationships?

10:57Yeah, no, we're absolutely forming new relationships. I mean, you can imagine, this is a very sticky business, and we've had a tremendous retention record. But bringing on new firms takes time, because sometimes we'll engage with a new firm, and they may be interested in coming onto our platform, but they're already in an agreement that lasts another four or five years. and it's hard for them to make that transition. So we're constantly working on building our pipeline and making sure we have a healthy list of prospects that are looking to get onto our applications, which we're fortunate to have.

11:28But also our new adventure in working with really large institutions has opened us up to doing really cool new projects, which we never did before. And for instance, right now, obviously the name of the game right now is AI. And that's sort of the big, you know, move for all technology companies. So we're pretty excited about that. And we're building a team around AI and thinking about what we can do with machine learning and various other methodologies in our business. And how can we offer new applications that will not only benefit our existing clients, but attract new clients. And there's a whole sort of world of opportunities and things that we're not doing today that we could be doing.

12:15We're looking at acquisitions as we speak, some very exciting acquisitions. We have a very healthy balance sheet and because we've never had any debt or loans or liabilities or external investments, you know, a lot of PE firms and investment bankers are very excited to work with us because we're an easy firm to raise money for. So there's certainly a ton on the go. There's not a dull moment, sir. Yeah. So Ali, you know, of those who are listening, who should be reaching out? And what is that kind of initial, what are those initial conversations generally like? So if you're obviously in this space and you happen to be in this niche market that we service, you're a Canadian, you know, wealth manager who needs an application, obviously that's an easy one.

13:02But we were, you know, very focused on the wealth management world. And if anybody technology on the technology side or on the wealth management finance side, if there needs for big data management and really foundational data platforms and reporting, those are all things that we're getting into quite a bit. And we've built a good reputation for, and, you know, we've spent the past 20 years getting really good at. So anything within wealth management, understanding the transactional nature of this business, the clients reporting, the taxations and all that, we're pretty good with all that. And even now, you know, if we were to look at new jurisdictions, because we've gotten so good at what we've done in Canada, we have a method to the madness that hopefully we can employ if and when we're looking at new opportunities or new markets.

14:01Yeah, that's terrific. Okay. So the website, again, Infinite Investments, it's inf-systems. Again, for Infinite Investment Systems, it's inf-systems.com. You've got a button here that says request a demo. Any other resources that you'd recommend if someone wants to get a feel for how the platform works, you know, kind of that next step in their journey. Yeah, we take a really sort of personalized approach to this because we recognize this system and what we offer isn't for everyone, would it be to be business? And we recognize that. So our first step, if you request for a demo is to have someone senior on our team, business development side, reach out, have the conversation, understand what business you're in and how we could potentially work together.

14:50And, you know, know, we've been very honest in our assessment. If we're not a good fit for a firm, we're upfront about it. We know our reputation is important. We don't want to waste anyone's time, but we take a pretty hands-on approach and a personal approach to this. So I would suggest people to reach out and we'll gladly set up a call or a coffee or something and get to know them and see if there's any potential opportunities for us. Yeah. You know, I wanted to point something out. I found this. What is Infinite Stories? I'm looking at your social media on LinkedIn. By the way, Ali, you're a great follow on LinkedIn.

15:25And again, your name, Ali, A-L-I-Z-A-H-E-D-I. But I see you having a podcast conversation with three other gents here. Is this a series that you're doing? It is a lot of fun. Infinite Stories, as obviously like us being infinite and infinite stories, you know, stories around infinite, but obviously we have an infinite number of stories. So that was the idea. And we thought, let's keep it fun. You know, there's enough content around finance and wealth about an hour in finance and, you know, your top picks and trends and this, that, the other, there's an abundance of it. And we're very serious people here.

16:05Infinite stories is just a way for us to have a good time. You know, we sit down, some of our team members just talk about their experience, how they join. It's pretty personal. Sometimes our clients join us and we'll have a bit of fun. We tell fun stories. It's just four or five minutes of us being silly every week and having a good time and having a laugh. And we thought, you know what, for anyone who's following us on LinkedIn, they get enough serious content from us. We owe them five minutes of smiles. And if we can get a smile out of anyone watching it, I think that's a big win for us. I love it.

16:39I can, I mean, there's a lot of reasons why I love this, you know, kind of getting back to my, you know, advocacy for brand journalism, but just, you know, again, just it's connections, it's relationships. And, you know, we just, we humans connect with humans. I love that you guys are doing this. It's quite brilliant. So if I may tell you a funny story, Josh, we were torn in telling internally, whether we're going to do this and whether it's going to be fun or not and serious or not and there were some people who were against it as soon as we started doing it we got such a positive reaction there were literally dozens of people who were like oh this is so much fun you guys should do this blah blah blah and it got such a great now this is no joe rogan podcast here we understand that but it's it's just got its own little traction and within our little world there's a lot of people that watch it and follow it and We get a lot of good laughs.

17:30You do? Friend and yeah, we've got a lot of good laughs out of it. And we've got some good people watching it. And, you know, we'll tell a story about the other day, my buddy, someone bumped into him and coffee got spilled all over him. And then how does that affect the rest of his day? But it's just a fun little banter conversation. And most people get a bit of few minutes of just break watching it. Awesome. All right. Ali Zahedi, again, your website, inf-systems.com. It's been a pleasure, Ali. You're the CEO. Thank you so much for joining us. Appreciate the opportunity. Thank you, Josh.

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