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The Connector Podcast - DFS Digital Finance Summit - Regnology's Global Expansion: From Regional Player to Champions League
Klaas from Regnology shares how the company transformed from a regional player to a European leader in regulatory technology, with ambitions to become the global champion following CPP investment and strategic acquisitions.
• Joined Regnology in 2022 when they acquired b.fine, modernizing their front-end offering
• Regnology's unique approach pivoting from a reporting platform to a data platform minimizes the impact of regulatory changes on financial institutions
• Won Regulatory Reporting Product of the Year Award twice due to granular data approach and cloud-native platform
• Secured funding from CPP in December 2024 to expand globally beyond their European leadership
• Partnership with Google Cloud enables optimal deployment and AI initiatives like regulatory chatbots
• Future vision includes improving two-way communication between regulators and banks
• Moving toward real-time supervision rather than traditional monthly/quarterly reporting
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Koen Vanderhoydonk
koen.vanderhoydonk@jointheconnector.com
#FinTech #RegTech #Scaleup #WealthTech
Welcome to the Connector Podcast, an ongoing conversation connecting fintechs, banks and regulators worldwide. Join CEO and founder Cohen van der Hooydonk as you learn more about the latest available trends and solutions in the markets.
Speaker 2:Welcome to another podcast, together with Belgium Fintech, and today I've got with me Ragnology and I've got Klaas with me and I know it's a little bit of a different story, but somehow part of the founders. But you need to explain us a little bit what that means.
Speaker 3:Well, yeah, we joined actually Ragnology in 22 through the acquisition of Befine, so Ragnology bought Befine in 22. And that was a major milestone for us and alsoine. So Ragnology bought Befine in 22. That was a major milestone for us and also quite pivotal for Ragnology, especially in the development further on for their product.
Speaker 2:And can you explain a little bit what that meant? What do you mean? Why were you so pivotal?
Speaker 3:Well, we were one of the first M&As. So Ragnology already did an important M&A in Subtech. They bought Pfizer in 21. And in 22, they continued on the M&A vibe and so they bought Befine and Kahlix and through the acquisition of Befine they were able to modernize the whole front end of their offering. That resulted in a rollout of our platform across Europe. So for us it was quite important to be part of that family because, thanks to technology, our platform became installed and rolled out across the whole European region, so I could say a leading platform, right? Yeah, you can say that in detail.
Speaker 2:Well, I say that not only because there was good acquisitions in terms of new business, but there was also acquisitions in terms of other companies that came on board right yeah.
Speaker 3:So that was the first. We were part of the first wave of the acquisition Nowadays we have around. We finalized around maybe 10, 11 acquisitions already. So it was also a learning process for technology. So we were one of the first ones and so there was still a lot to learn. Nowadays we have playbooks to deal with acquisitions, to rapidly integrate, to rapidly decide what we will do with a product, how we can onboard the people and so on.
Speaker 2:So, yeah, definitely a big improvement compared to two or three years ago and the BeFind platform is still there.
Speaker 3:Yeah, it's still there. It's still part of the Ragnology stack and plays a quite important role in in the overall what we call now the technology reporting hub.
Speaker 2:So it's quite an important component in the in the overall product offering and technology supports a lot of financial institutions at a lot of regulatory spaces. So, um, how does that work? How can you keep like the difference of all these different countries, if I may say, of regulatory spaces? How does that work?
Speaker 3:well, we start with with, of course, the analysis. We have a clue. We have closely, thanks to the fact that we are not only offering solutions but also subtext solutions. We are actually closely connected to regulators as well, so we are well aware of what regulatory changes are upcoming. We are even part of a lot of. From the start. We are even implementing these ones and designing these together with regulators, so that helps us well in designing the right Rectex solutions.
Speaker 3:So that makes us really unique in the market. Due to the fact that we have a presence at both sides, we can easily adapt our Rectex solutions and really implement what is really requested by regulators. Next to that, yeah, the fact that we have quite a unique approach in the market. So we are really pivoting from a reporting platform to a data platform, which means that new regulations have a minimal impact for customers. So we, thanks to our granular data approach, we have already a lot of the data elements that need to be reported present in our platform, and so we can easily adapt the platform to new regulations by minimizing the impact for banks, insurance companies.
Speaker 2:Is this the reason why you've actually been recognized and received the prize of being the Regulator Reporting Product of the Year Award and the Risk Market Technology Award twice, or have I missed?
Speaker 3:something. No, no, that's indeed. Our granular data approach is one of the key drivers over there, next to the fact that we already did the whole transformation to a cloud-native platform compared to most of our competitors. They are still in a transition phase or starting to do the transition. We have already done that transition, so that's also there. We are quite ahead of the curve, I would say, compared to our competitors. That's also one of the main reasons, I think, why we received those awards.
Speaker 2:Congratulations again. I think there's another reason I should say congratulations, because it has been a tough time for a lot of startup technology companies to get fresh money and you guys managed to secure funding with CPP back in, if I believe, December 2024.
Speaker 3:Yeah, indeed. Yeah, that was indeed a huge milestone for the company. Next to the previous important milestone for the company was around 2020, when Nordic Capital came on board, and that was quite a pivotal moment for the company. But now again, with the entrance of CPP, it will also be pivotal for the company, because the previous five years were focused from growing out of the DACH region, I would say so. We became a European leader in REC reporting and now, with the entrance of CPP, we want to become the global leader.
Speaker 3:One of the first steps we did was also to the acquisition of Wermack was one of the first steps in that direction. So now we have not only a major customer base in Europe, but also in US APEC. So we have presence in, we have an office in US, we have customers over there. We have quite some customers in Singapore, hong Kong and Australia now, so we are now ready to serve the G-SIP financial institutions in the world. So I would say that, if you compare with football, that we are now playing in Champions League and we are well-placed to play the final in the end, nice one, nice one.
Speaker 2:And since we talk about football, not so long ago we had South Africa as the place where the World Cup was connected. Yeah, we're getting old, so I also saw that South Africa, for example, is on the list. So what would you see, are the differences between all these different continents? I mean, especially you being part of that initial sort of blueprint of the systems. Is it really the same in different countries and continents?
Speaker 3:Well, in the end, regulators are more or less looking at the same type of information.
Speaker 1:They all want to have statistics around.
Speaker 3:They're all looking at your key risk indicators. They all want to monitor your liquidity risk, credit risk, market risk. They all need statistics for their own economic decisions. So globally, we see quite the same level of information that is required. Of course there are local flavors, but let's say that 80, 90% is probably the same set of information that regulators are looking for. Of course, we see difference in the underlying technology, so the adoption of cloud goes not at the same speed across the whole globe, so the offering is adapted a bit as well to the regions where we are operating.
Speaker 2:I know you have openly a partnership with Google, but does that mean that you force the banks to use the google platform? Or you, or can, or you open to on a cloud or on-prem well, we have a clear uh non-prem strategy.
Speaker 3:So, um, we, we strongly believe in in a sas offering. So there we and we, we only have we only collaborate with google, because we believe that that's the best cloud in in which we can offer our, our ragtag solutions. Um, also, due to the fact that we closely collaborate with google, we can we can also offer the best um deployment and monetary environment for our customers. We also have a lot of benefits of the collaboration with Google, so a lot of AI initiatives are jointly initiated in close collaboration with Google. So that's also a great benefit, I think, from collaborating closely close by collaborating closely with one cloud provider instead of going for a multi-cloud strategy.
Speaker 2:Well, talking about Google, you talk about Gemini, so are there a lot of AI projects running, because you have obviously an awful lot of data across the globe.
Speaker 3:Well, what we are? We have a lot of AI initiatives ongoing, so one of the first ones. Of course, everybody has a chatbot.
Speaker 2:Oh, really Never heard about it.
Speaker 3:So that's of course the quite obvious one.
Speaker 3:So it allows our customers to interact with the chatbots on regulatory topics, on questions about the platform, how regulation is really implemented into our platform. So we give a lot of transparency on how that uh, how regulations is finally implemented in the in in the solution. So we they get a full end-to-end transparency. I would say thanks to that chatbot. Other initiatives that are redoing is more in the development in the R&D department. So there we use AI to speed up developments, obviously, and also in our professional services. So when we do implementation projects we use as well AI to speed up the data integration part, because that's still the part that takes the most time. So the data mapping, understanding the data elements, the data catalogs from the customer, mapping the data catalog, mapping that to our data catalog that takes quite some time. So with AI we can really speed up that data mapping exercise.
Speaker 2:Yeah, and I'm glad you talk about data mapping, because data mapping also has to do with quality of data. And I'd like to bring that back to what you said earlier when you mentioned supervisory technology and you're at the foreground to sort of decide or to together come to new paradigms and new sort of formatting. How do you see the current state of things in terms of formatting and alignment compatibility across the globe?
Speaker 3:Well across the globe. We are not there yet, although there are some. I think in the ESG space there are global standards that are getting getting implemented, but in the rest you're talking about taxonomy in that case well, I'm talking about iXBRL taxonomies.
Speaker 3:there is quite some alignment on at the global level over there and if you look in Europe, some alignment at the global level over there. And if you look in Europe, there is quite some initiatives taken by ECB. So you have the BERT and IREF initiative, which will bring more standardization. I'm not saying that it will be no Valhalla yet yeah but there will still be some local flavors over there.
Speaker 3:but we expect that it should bring a bit more standardization than we have currently today in the area of statistical reporting. So I think that's a good progress over there and I think we will see it more and more coming. So the shift away from template-based reporting to granular data reporting will bring more standardization, at least at region level, or even at the global level.
Speaker 2:Well, it's nice that you give a bit of a glimpse what we can expect. So sort of bridging on this and coming also to the end of this podcast. You obviously had a very exciting last five years, so what can we expect for the next five years for Ragnology?
Speaker 3:So, yeah, like I already mentioned, we started initially as a regional DAG player, then became the European leader and now, within the upcoming five years, we want to become the global leader, and we are on a good track over there. With the acquisition of Vermic, we definitely increased our footprint globally. The other thing we are seeing is that what we're investing on and focusing on is on improving the workflow between regulators and regulated entities. So still too often we see the process is broken. So banks are delivering their data, but they don't capture the feedback immediately from regulators. So there, we want to have a really, really two-way communication process in place between regulators and regulated entities, so that it's Again subtech yeah, so that we have, thanks to the fact that we have Rechteck and Subtech, we know how to close the gap between both worlds. So we see quite some evolution in that area.
Speaker 3:Another area where we think that things will change is in the fact that we will probably maybe not in the upcoming five years, but we will, in the end, move to real-time supervision. So now, perpetual? Yeah, well, now it's still quite post factor. So if you look at, yeah, banks deliver the data on in in some cases already you know, daily basis, but that's really exceptional. But let's say, on most free, regular basis. Most frequently it's Most frequently it's still monthly, quarterly, but that will change in the near term, given the fact that the landscape is also changing. So the world is becoming less predictable. Regulators will also anticipate on that by collecting data on a high frequency.
Speaker 2:Well, thank you very much, Klaas, for sharing these insights here in this podcast. I wish you obviously all the best of luck and keep us posted of this journey, and thank you so much.
Speaker 1:Thanks for listening to another episode of the connector podcast. To connect and keep up to date with all the latest, head over to wwwjointhekonnectorcom or hit subscribe via your podcast streaming platform.