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Ian Taylor

Wraps in the UK are coming up to their 10th birthday this month and Transact’s managing director is proud of helping to blaze the trail. He believes the company is well placed for the next 10 years as it is already positioned for the RDR and concentrates on its core business of service for IFAs Interview by Tracey Scott


This month, Transact celebrates its 10th anniversary and managing director Ian Taylor reflects proudly on the day the UK’s first wrap was born. “An old friend said he had met a couple of mad Australians and thought I ought to go along and have a chat with them. One of them was Mike Howard, who is now my boss and Transact chairman,” says Taylor. “We got together, rented an office in London above an Italian restaurant called the Fire House and started the business. Mike is the man who made the decision to start wraps in the UK.”

Of course, launching a wrap was not as simple as two men with PCs. Taylor spent most of 1999 getting advisers to use the service, talking to regulators about his plans and raising capital from private investors, including Howard’s Melbourne-based technology firm ObjectMastery.

“On March 15, 2000, we wrote our first piece of business,” he says. Now Transact has around £8bn in assets under management,nearly 100,000 clients and a team of 280 staff, with 140 focusing on working with advisers.

“It has been one of the most influential financial services companies in the last 10 years. It is very gratifying to know that we have invented a whole new financial services sector.”

Taylor describes himself as the Alan Partridge of financial services as he spends weekends at home in Lincolnshire but bases himself in the Holiday Inn across the road from Transact’s offices during the week. He says setting up in a new market was a mixed blessing. “We had no one to copy, which is both a great advantage and a disadvantage.”

But having spent much of his career in marketing promotional products, Taylor knew how to make Transact a sellable and attractive proposition.

“Our core principles of the business we set up in 2000 have not changed at all. Our thinking was always that we would have integrity, that we would make a profit, would never be greedy and would always be absolutely clear who our advisers were and who we were working for.”

When Transact came to market it was set up as a wrap that operated on customer-agreed remuneration. Critics said such a charging structure would not work with advisers but Taylor says: “The reason Transact is chosen is because it is the most suitable. It is not to do with overrides or inducements.”

The charging structure fits neatly with the FSA’s requirements in the retail distribution review but Taylor says the RDR is going be an enormous spanner in the works for other platforms.

“It is much more to do with overcoming the intellectual hurdle of changing the way you think about the market, changing who you think your customers are and coming to terms with the fact you cannot control distribution with money any more. That is something an awful lot of people have not even thought about.”

Having recently cut its platform charges, Taylor is aware that Transact might not be the cheapest platform. He says, where possible, Transact will cut charges without risking the business but he believes being the best platform almost always means you cannot be the cheapest. “We provide services for managing complex financial plans. We are not there pushing ourselves forward, providing answers to simple questions.”

With many platforms demonstrating “suicidal pricing” and offering “the same thing”, Taylor believes many need to revisit their business plan and start differentiating themselves from the competition if they are to succeed.

He also foresees there will be a lot more movement in the market as businesses enter and exit. “During the last 10 years, we have seen people come and go, and I am sure over the next 10 years you will see more people come and go. The difficulty they will have is attracting the money in the first place. When you have 15 platforms that all look virtually identical, how are you going to choose which one to use?

“Brand and differentiation will make a difference at that mass end of the market. We will be in a different place.”

Taylor is predicting a clear divide in the technology market between the life offices and banks that serve direct to the consumer and those that offer complex solutions for investors. He is frustrated by the fact that people have lumped platforms together but is confident Transact will remain in a completely different area.

“There is no UK financial services company with a shareholding in Transact and we own the software. That gives us a greater degree of control over our future. We are compulsive in-sourcers.”

The firm has no no immediate plans to float and Taylor expects the next 10 years to be as exciting as the last. He says they are planning to add extra functions to the wrap in the next six months and are also considering the GPP market.

“We have been looking at GPPs for more than a year now and we are at an advanced stage of developing the systems for it. It is just a matter of finding the right partners.”

But he says providing a core service for IFAs remains the priority. “Our plan for at least the next year is to stay close to our advisers – they are the best source of business planning and strategy.”

Born: Essex, 1964
Lives: Lincolnshire and London
Education: MA in English, Peterhouse, Cambridge
Career: 1999-present: managing director, Transact; 1992-99: marketing manager, John Govett; 1987-92: business planning manager, Royal Life
Likes: Wits
Dislikes: Dimwits
Drives: Nothing
Book: Catch-22 by Joseph Heller
Film: Apocalypse Now
Album: Never Mind the Bollocks by The Sex Pistols or Metal Box by PiL
Career ambition: Already achieved
Life ambition: To die wise


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