The main challenge remains the same

Lance Uggla, chief executive of Mark-It Partners, says his company’s competitive edge is its immaculate data set. By Oliver Holtaway

Whichever asset class Mark-it Partners moves into, says chief executive Lance Uggla, the main challenge is always the same: “Trading desks are happy to share information to help customers manage their business, but not equally with their competitors. To maintain a level playing field for the banks that are investing in electronic platforms, you have to establish a set of rules for the banks so that they can participate, but also maintain their competitive edge.”

As chief executive, Uggla faces his own stiff competition – from rival financial information heavyweights such as Reuters, Thomson Financial and Bloomberg. But data provider Mark-it Partners has shown its willingness to take on the big boys at their own game, selling data directly to end-users rather than taking perhaps the easier road of licensing its data to the platform providers. Uggla says: “Our largest rivals have a competitive edge through their platforms. Our competitive edge is our clean, complete, accurate content.”

And the importance of a clean data set is being felt more keenly than ever by market participants, he argues. “In the current US regulatory environment, you can go to jail if you sign off on a set of accounts. You need independent data for peace of mind,” he says.

Vancouver-born Uggla has been involved in credit for long enough to see the demand for reliable price information grow and grow. He was awarded an MA in accounting and finance from the London School of Economics in 1986 and graduated straight into the frenzied recruitment drives of the Big Bang era. But despite being interviewed for several positions at US investment banks’ London offices, visa problems saw him return to Canada, where he took a job in Toronto as a mortgage-backed securities trader at Wood Gundy, an old, established Canadian investment bank. Soon after, Wood Gundy was bought by CIBC. By 1995, Uggla had risen to head of debt capital markets.

At this point, says Uggla, the credit derivatives market was in its embryonic stage, and “people didn’t really think of ‘credit’ per se.” Uggla, however, took an interest in bringing fixed income and derivatives together.

He joined Toronto Dominion’s London office in March 1995, bringing his wife and three children to the UK (his fourth child was born in his adopted home town of St Albans). Here, Uggla ran Toronto Dominion’s European and Asian credit business, with a specific aim of developing the global credit trading capability.

Toronto Dominion’s presence in the credit markets was substantial, given that it was a medium-sized regional bank. Crucially, says Uggla, “it was an institution that early on put cash and derivatives trading groups together and properly integrated them”.

While running Toronto Dominion’s global credit trading group, Uggla approached the big investment banks to provide Toronto Dominion with daily price data. “As we were good customers of theirs, they agreed,” he says. It was this arrangement, formed in 1999, that provided the seed of the idea for Mark-it Partners. The credit markets were growing exponentially and other banks had the same data needs as Toronto Dominion. They too needed to back up their investment and trading decisions with a robust data set.

Uggla approached Toronto Dominion chief executive Don Wright with the idea of setting up an independent provider of price data. “The data has always been there,” says Uggla, “but there was no clear multi-dealer consensus that was properly cleaned and maintained.” Wright liked the idea, and Toronto Dominion took the initial risk of setting it up. The official spin-off of Mark-it Partners from Toronto Dominion took place in 2002.

Today, Mark-it Partners has more than 250 customers. Hedge funds have been a strong driver of growth over the last year. Mark-it Partners has also expanded through a series of acquisitions. The next move? Daily prices for asset-backed and mortgage-backed securities.

This article originally appeared in the December 2004 issue of Credit magazine