ATLANTA -- Three consultants left Watson Wyatt to establish the newest investment management web-based service.
Jim Minnick, a founder of EVestmentAlliance, said the firm is being positioned as a central repository for investment management data and as the primary web portal for the pension industry.
EVestmentAlliance will provide a variety of interactive services but will not offer investment consulting or money manager recommendations, he said.
Mr. Minnick, former research consultant at Watson Wyatt Investment Consulting, Atlanta, formed the firm along with consulting analyst Heath Wilson and research analyst Matt Crisp.
Finding financing
Financing is coming from the founders and a group of individual "angel investors" Mr. Minnick wouldn't name. He said the firm is seeking venture capital money as well.
"We are putting together a range of services using the Internet, including a comprehensive money manager database and investment information and research materials, which can be updated on the Web," said Mr. Minnick. "It will also involve customized services, reporting functionality and analysis to better facilitate interaction by industry participants.
"We will not be making money manager recommendations. We don't want to be consultants, we want to help improve the ability of consultants to do their job."
The EVestmentAlliance data-base will provide outsourcing of database services to the consulting community along the lines of desktop services offered by Mobius Group Inc. and Plan Sponsor Network, but with the ability to provide rapid information updates using the Internet. (A Mobius spokesman said the firm plans to begin web-based updates by the end of the year.)
In addition, he said, it plans to develop a range of services for the pension investment community.
A special committee made up largely of consultants is being formed to design the initial offerings and to provide input on future product development.
Some consultants such as Callan Associates Inc., San Francisco; William M. Mercer Investment Consulting Inc., New York; and Frank Russell Co., Tacoma, Wash., maintain their own database services. EVestmentAlliance is expected to appeal to those who subscribe to third-party database services or outsource data collection services.
Watson Wyatt is the first consulting firm to agree to participate in the alliance.
Outsourcing data
Jeff Nipp, head of investment research at Watson Wyatt, said both he and Brian Hersey, investment director, will serve on the EVestmentAlliance advisory committee and will assist in the development of products and services "that will benefit the consulting community."
"We expect to derive benefits from EVestmentAlliance through streamlined service delivery and faster response times by cutting down on the production processing time. We will see more and quicker data delivery and we are willing to pay for that," said Mr. Nipp.
"We have long supported the outsourcing of data collection services," said Mr. Nipp. "You need to scrub, ventilate and interpret the data, some of the more mechanical things that we don't do and don't want to do. We want to focus on the interpretation of the data and more of the value-added services in using the data."
Mr. Minnick said he expects EVestmentAlliance to offer live delivery sometime in the third quarter. The website address will be www.evestmentalliance.com.
EVestmentAlliance hopes to exceed the database offerings of online consultants InvestorForce Inc., San Francisco, which claims to track more than 1,400 money managers, and eFrontiers Inc., San Francisco, which tracks 1,300 money managers.
Unlike those firms, however, Mr. Minnick said EVestmentAlliance will not be a conduit for manager searches. Nor will it offer online consulting services.
Mr. Minnick would not discuss fees now, but added he will disclose them as the venture nears a third-quarter launch date.
EVestment Alliance revenue will be generated by selling its database services and by specialized reporting, analysis and data manipulation services to the consulting community using the data.
"As I see it, our alliance partners are the experts and know what their needs are, and we want them as advisers to come to us and say this is where we are spending a lot of time on a particular issue, and help us identify areas of need," Mr. Minnick said. "We will help build the tools needed to address these problems."
In addition to its planned database service, EVestmentAlli-ance aims to become a focal point for the pension fund industry. He said the EVestmentAlliance website will offer plan sponsors a central point for information about the money management industry, and will host online meetings and data exchange. It also will publish position papers and research reports.
Plan sponsors will have access to the database at no cost.
For investment managers, the site will serve as a central location for delivering information to plan sponsors.
"We expect it to be a source of information, and a central place where people in the industry want to come. It's not just us as a silo, but we want and expect this to be a collective effort among all industry partners."
Lawrence D. Davanzo, president of investor services at InvestorForce, said the formation of EVestmentAlliance "validates" the business model used by InvestorForce and others of delivering timely and targeted information to the pension industry. But he noted the new service is in for some "heavy lifting" as it builds a database collection and delivery process.
