Karen Watkin: Welcome to AB Alpha Females, the Multi-Asset Investment podcast. I'm Karen Watkin, and I'm a fund manager in the multi-asset solutions team here at AB. As a multi-asset investor, I love the challenge of looking across the capital markets to deliver the best outcomes for our clients. I work closely with colleagues across all areas of the investment universe to tap into their research and expertise along the way. The alpha females are those women who have developed these unique areas of expertise and made their mark in the investment industry. In this series, we'll hear their expert insights on key questions for multi-asset investors. I'm also going to be looking at their career journeys, the challenges they faced, and the lessons they've learned along the way. So stay with me as we uncover the stories of these impressive and inspiring women and gain a deeper understanding of the multi-asset investment landscape.
What do you need to be successful in multi-asset investing. Dedicated, knowledgeable, and professional portfolio managers, for sure. Clients who understand what they want and are open to ideas, absolutely. But without a strategy and an operational model that works seamlessly from end-to-end, then these qualities risk being wasted. In order to be successful in multi-asset investing, a whole range of elements need to be in place. The right technology, a robust trading structure, the best data sources, and more. Critically, it also needs the right person to understand what's needed and how to make it happen. That person requires a range of sharply honed professional and personal qualities. In AllianceBernstein, Jennifer Santangelo is one of those talented individuals. Previously as the Chief Operating Officer for AB's Multi-Asset business, and most recently as Head of Business Operations across investments, Jennifer is the linchpin, connecting people and technology and taking the vision to reality. Jen has been with AllianceBernstein for almost 20 years and has taken on some high-profile projects, including establishing the first multi-manager long-short hedge fund for the multi-asset business. What are the special skills required to do this job and what difference does it make for our clients and the multi-asset business itself? Jennifer Santangelo is here to answer these questions and more. Jen, welcome to the podcast.
Jennifer Santangelo: Hi, Karen. Thank you. Appreciate the opening remarks.
Karen Watkin: What does it really mean to be a Chief Operating Officer or head of operations when you're running an investment business? What does your day-to-day really look like?
Jennifer Santangelo: My role is really embedded in the investment team and focusing on everything non-investment-related. We want our portfolio managers focused on what they do best, and everything else really falls within my remit and my team. And so it's multifaceted in terms of really looking at our infrastructure, our technology capabilities, our trading function, how we're utilising the best in class data sources. And then really, it's all about people as well in terms of really having strong leadership and talented people that can execute on our strategies here in the multi-asset business.
Karen Watkin: Why is it so important, do you think, to have that robust and flexible infrastructure when you're trying to support different investment strategies? What are some of the critical things that you need to take into consideration when you're looking across that whole spectrum of the business?
Jennifer Santangelo: It's not one size fits all. We really pride ourselves in being able to solution for our clients. That could be from a range of different products. You mentioned our multi-manager hedge fund business. So that's very unique, dynamic, requires different capabilities than, let's say, some of our outcome custom solutions for clients. And so it's really having the capability to be dynamic and flexible in having a strong baseline of technological capabilities and then building upon that to customise where needed to offer the most effective, efficient, and risk-controlled solutions to our clients as possible.
Karen Watkin: You talked about you were obviously instrumental in setting up that hedge fund business. It was a very new type of strategy for AB to take on. How do you set about taking what starts as a strategic vision and actually turning it into reality?
Jennifer Santangelo: Yeah, it's actually a lot of fun. It was a huge challenge, but very exciting journey with a team of people to accomplish implementing that strategy here at AB, which is traditionally a long-only asset management company. We really looked at what our peers do and had a strong vision on what we needed to focus on building in order to attract top PM talent in the multi-manager hedge fund space and have the right tools that they would want to utilise to run their strategies here at AB. We did spend a lot of time in a short period of time, to really execute on best-in-class capabilities that I think at this stage are very competitive. So it really does require a lot of due diligence with speaking with our peers in the industry and some consultants, et cetera, and leaning on what we can use at AB, which we did do a lot of leveraging of our infrastructure, back office infrastructure, and built out a lot of the front-end tools, which was really pertinent for our portfolio managers to execute on the strategy.
Karen Watkin: Jen, when you were launching that new business, you talked about, obviously, there's a lot to do from the people side of things, but then can you talk me through what else you needed to build? Was it trading systems? Was it back office operations? What was different this time around that meant you had to think differently about how to build this type of investment capability at AB?
Jennifer Santangelo: It was actually the build out of the whole business in of itself. So it was really first building out a CFO function, a business function to manage that process, which is very different than our traditional portfolio management structure. Then it was the actual infrastructure itself, building software that could support that that need. In addition, it was hooking in with our third-party prime brokers. As a firm, we traditionally had one, we added six, right? And it was really a focus on really making sure that we could build the business smartly to scale, which we did. We started with 12 portfolio managers, and at the peak, we had about 40.
Karen Watkin: Jen, I'm sure another critical part of what you often look at, as well as the portfolio managers, the trading infrastructure, the data, a large part of it. What we do as portfolio managers in the rest of the multi-asset business is about managing risk. So what are some of the key things you think about when you're trying to manage risk across a very complex investment strategy?
Jennifer Santangelo: It starts, obviously, first with making sure we have robust infrastructure and technology and then building upon that. We built a lot of real-time monitoring and alert tools that would go to the operational team when certain criteria were triggered so that it wouldn't interfere in the portfolio manager process. In addition, there's a lot of robust reporting, risk reporting, attribution reporting, et cetera, that happens to really scrutinise and be on top of the risk exposure for the fund.
Karen Watkin: You did an amazing job bringing that hedge fund strategy to AB. And then the last few years, you've taken on a broader role looking across our whole multi-asset and hedge fund solutions business. I know that you're often a critical part of client due diligence before they perhaps make the final decision to invest with us. Can you talk me through what do you find clients are often looking for at that stage of the process? And what are some of the things that you need to be able to demonstrate in those meetings to give clients the confidence before they choose to invest their money with us?
Jennifer Santangelo: I think you hit it on the head when you said confidence. The clients really want to feel they can trust our people and our processes and that we can demonstrate that they've been tested, that we have a strong control environment. Really being able to demonstrate clients come back year after year. The question is always, what's different from last year? We're always able to demonstrate all of the innovation and work that we've done to continue to control risk and evolve our business. I think that always shows clients that we're looking to evolve and be best in class.
Karen Watkin: When you think about operations more broadly, is it about having the right strategy in place to begin with, or is it more about the implementation and execution?
Jennifer Santangelo: I think it's a combination of you have to start with a strategy and what is the objective or what we're trying to deliver. Sometimes you can't always get to the end state right away. And so it really is then a function of breaking down into components in terms of, okay, what can we deliver right away in a most effective manner? And then it is really helpful, actually, when we then implement stage one and learn what we don't know, let's just say, and then build upon that and make our processes and infrastructure even more robust. I have found we try to solve everything in one go. It's not the most effective approach. Typically, when we start with a strategy and then break things down into projects and implement along the way, it usually is successful.
Karen Watkin: I mentioned in the introduction that you're this linchpin, and I think of you as having to manage all these different stakeholders. As you said, there can often be perhaps competing demands. How do you navigate it?
Jennifer Santangelo: There's never a shortage of competing demands and asks. So it's really looking at which ones will have the biggest commercial impact and which needs we really need to solve for. And being very specific then in sending out that with our message to our internal stakeholders. I'm very intentional when I set out on a new project that we need to work on. I make sure the stakeholders are clear that this is the top priority so that everyone is mobilised and we focus on delivering on this top priority. I do spend a lot of time sitting down and making sure I have a strong understanding of what we're trying to achieve first, and then I set all the different teams to mobilise into action.
Karen Watkin: When you're looking at investment process in particular, and when you've had to build these innovative portfolio solutions for our clients, what do you think is the most important component? Is it having the right technology in place or is it having the right people and teams in place?
Jennifer Santangelo: It's definitely a combination of both. We certainly do have a lot of strong technology here at the firm, and it does require the people to really define how we're going to use the technology to the best of our ability to serve the different client needs. We typically We don't just turn on a new product. It usually takes a lot of thought, a lot of planning, and a lot of looking at our inventory of technology solutions and making sure we use the best that has the least risk for solving the needs for that new product.
Karen Watkin: I mentioned as well, you've been with AB for nearly 20 years now. If you look back over that time, what do you think has changed over the course of your career?
Jennifer Santangelo: The industry has certainly evolved and also the need for real-time information. That is a must and a critical component right now for most strategies. In the past, you can get away with start-of-day, end-of-day information. Now it is real-time. And so we've built those tools. In addition, there's the evolution of ESG, of course, which we've had to solution a lot of our services to meet those client needs as well. So that required some development capabilities as well. So it's really staying abreast of the regulatory environment, what our client needs are, and satisfying our investment professionals at the same time.
Karen Watkin: Given all of that, what do you think are some of the key qualities that are required to be successful in this type of role and to build a robust infrastructure around an investment business?
Jennifer Santangelo: Being a trusted partner with our clients and our portfolio managers in terms of really understanding the need and the ask, and then the trust that we will deliver on that. There's a big element of problem solving. Typically, we don't like to say no. We will say, yes, we'll figure this out. We know we can solution, we've done a great job with solving a lot of our client needs. It's really taking away, looking at the strategy and executing effectively.
Karen Watkin: You've clearly demonstrated all of that, but how do you define professional success?
Jennifer Santangelo: In all my nearly 20 years here at AB, I've always enjoyed my role. I find coming to work really being exciting and achieving and delivering on goals and objectives. To me, that's a big part of my professional success. I really feel it's enjoying the career progression and continuously developing and progressing in my career. Change and challenge has always been a positive for me in terms of learning and developing and moving into the next segment of my career.
Karen Watkin: So, Jen, we've talked a lot about how important it is to have the right risk controls in place when you're building the infrastructure for our investment strategies. And obviously, as investors as well, we're all about taking managed risk. I'm keen to understand your own personal appetite to risk and how you've thought about that through the course of your career.
Jennifer Santangelo: I think a lot of people would look at me as very risk averse, but quite frankly, it's sometimes very opposite. With the multi-manager hedge fund, when we were first bringing that into AB, and the idea was to build it in-house, my response was, oh my goodness, that's nearly impossible. And then a moment later, I was on vacation, I got the phone call being asked to actually run the operations. Right away I said yes , I said this is an extremely exciting and wonderful opportunity challenge to really make this happen here at AB. And I knew there was a strategy and a whole vision behind the business, and I really wanted to be part of that solution and make it happen. My vacation ended quite quickly after that and was on the phone and really planning next steps to make it happen, and it was super exciting.
Karen Watkin: I love that you took that opportunity. I think it's sometimes easy when there is something very new or that might feel uncomfortable to perhaps not step into that. But I love that when it comes to things like that, you absolutely take the risk and you've demonstrated it can totally pay off with huge rewards.
Jennifer Santangelo: That's an extreme example. I have to say in my tenure at AB, that's typically how I've progressed in my career is really taking the risk of when asked to lead a new effort in terms of integrating new businesses into the firm. I always put my hand up and say, yeah sure. That sounds great. That sounds exciting. We can make that happen.
Karen Watkin: It looks like you've always been willing and keen to take on new challenges through your career. What advice would you give to other people, perhaps earlier in their career, about how to navigate that type of path?
Jennifer Santangelo: I think it's important to be open to new opportunities, to maybe not say yes right away, but to, of course, understand all the information and to put yourself out there to try something new. We may not always tick the box for all the qualities for a certain type of new role, but if you're a hard worker, smart, of course, you could do that. I think it's try to say yes to new opportunities as much as you can.
Karen Watkin: Where does your personal sense of purpose come from?
Jennifer Santangelo: I think it's really important. I think you might have said it, paying it forward. In my career, I've been fortunate to have different mentors, female and male, and secret sponsors or sponsors and that's really important. And I do spend the time now with the Women's Synergy Group participating in different mentorship programmes over the years, even informal mentorships, really just helping people to continue to develop in their careers. And if I can help them with networking or put them in touch with someone that they're expressing interest in a different type of role, it's really important to just continue to network, develop different skills, and really make sure you're focused on professional growth. I feel like I've had the fortunate capability here at the firm where I had the sponsorship, and so I really want to pay that forward too.
Karen Watkin: I think that's so important as we think about building that pipeline of talent. What would you say are your three key insights in terms of the ingredients you think you need to build a successful multi-asset business?
Jennifer Santangelo: The key ones, I would say, creativity to be able to solve for outcomes, collaboration to really execute on all the ideas, and the evolution of capabilities that will make us best in class.
Karen Watkin: Fantastic. Thank you so much for joining me on the podcast today, Jen.
Jennifer Santangelo: Thank you, Karen. Appreciate your time.
Karen Watkin: One of the key things that really stuck in my mind after that conversation with Jen was the phrase she used about being a trusted partner. I think that's so fundamental to what she does in her role. What we try to do as a multi-asset business here at AB is being a trusted partner to our clients in terms of the investment outcomes we deliver, but the way that we do that for them and having that very robust infrastructure that they may not always see, which is really behind the scenes, but it means that what we deliver to them is seamless from end-to-end. Then I also think being a trusted partner for somebody in a role like Jen's, it's also about being a trusted partner internally. She talked about the importance of managing lots of different internal stakeholders, and sometimes she has to navigate quite competing demands. Being a trusted partner to the different parts of the business that you're having to work with is also really important. The other two fundamental ideas I think she touched on when we're thinking about building a robust infrastructure for multi-asset business is being collaborative, being able to forge those relationships, get stuff done is really important, but then also being flexible. I also really like what Jen spoke about in terms of paying it forward. She's not only focused on operations and technology, she's really focused on the people in the business. She looks to develop that pipeline of talent through her leadership I think she gives a huge amount back in terms of actually helping, as she said, see that talent come up through the firm and spread their wings.
That brings to a close this episode of AB Alpha Females: The Multi-Asset Podcast from AllianceBernstein with me, Karen Watkin. If you've enjoyed this episode, don't forget to tell your colleagues and friends about it. It only remains for me to thank Jennifer Santangelo. This episode was produced by Richard Miron from Earshot Strategies.
