The crowded data quality market continues to spawn new entrants. In a market with over 60 active vendors selling software, then unless you are a well-known brand then you need to do something to distinguish yourself, either in technology or approach. Every textbook on software marketing also tells you that specialisation in a niche, at least initially, is a smart move. Irion is an Italian data quality company who have done this, offering data quality software on an annual rental model (which in itself is unusual) entirely focused on one market, banking. Founded in 2004, they have steadily brought on board some impressive clients, such as UBS in Italy, and a number of other large local banks.
There are some peculiarities to data quality for banks that Irion has tackled. One is the need to deal with external data feeds such as Bloomberg, who provide pricing information. A common problem is to reconcile individual trades made during the day with the total "position" that the bank has at the end of the day. If the two do not match, then the bank needs to go back to the trading counterparties and resolve any errors, which can be caused simply by bad data (and more recently for more dramatic reasons, such as that counterparty being Lehman Brothers).
There are also regulatory issues. There are several providers of real-time prices, and so you will typically set up rules at a bank defining which price to use for a trade. If that rule changes at some point, then you will need to keep an audit trail of when that rule changed and who did it in case the regulators inquire. Having these rules buried away within trading systems is one approach, but keeping the rules and controls in a separate data quality system keeps things in one place and provides advantages, especially if that system provides an automated audit trail of changes as Irion's software does.
Of course specialising in one market has many advantages, such as understanding the language and business practices of that market intimately, something not to be underestimated when selling. It can have a downside if that particular market goes through hard times, and not many industries are going through harder times than banking at present. In principle, banks should be caring more than ever about controls, audit trails and data quality, but it seems inevitable that this will be a tough market for software vendors on the near term, rather than la dolce vita of recent years.
Irion is a small vendor, but it has done well in a short space of time by an admirable focus and a business model that minimises the lengthy sales cycles that bedevil enterprise software companies. So far it has shown a laser focus on a single market niche that has served it well. Italians (or at least the Lombards as they were then) pretty much invented the modern banking system in the 13th century and, despite the current market turmoil, there will be banks around in the future (perhaps rather fewer of them), and data quality problems around in the future, so software vendors that come through this crisis should have plenty to do.
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