Hicke has a long road ahead to match his predecessor. SEI founder Alfred West Jr. started selling computer services to investors that sped up trades to Wall Street in 1968 and pioneered tech outsourcing for banks. He took the Oaks, Montgomery County-based company public in 1981, steering the firm as it shifted products and evolved for 54 years. At age 79, West is taking on the new title of executive chairman. Hicke, 44, previously led U.K. asset management and private banking for SEI.
SEI manages or administers $1.3 trillion in assets. SEI said it has 8,700 clients, including 10 of the top 20 U.S. banks and 49 of the top 100 investment managers worldwide.
SEI acts as a back office for Wall Street: It sells asset management and fund administration software, outsources investment processing, advises investors on selecting assets, and has set up its own mutual funds. Its clients include private banks, institutional investors, investment managers, corporations, retirement sponsors, nonprofits, hedge funds, brokers, financial planners, life insurance agents, endowments, and foundations.
SEI Investments’ share price peaked at $72 in 2017, dropping as low as $52 in 2020. Lately, SEI stock (Nasdaq: SEIC) trades at about $59. SEI sales were more than $1.9 billion last year, up from $1.7 billion in 2020.
The Inquirer interviewed the founder and his successor. The interviews has been edited for length and clarity.
Q: 50 years, wow. Anyone else still around from back then, Al?
West: We have a lot of people who have been here 30, 40 years. Ryan has 24 years with the company.
Q: How did you know he was the one?
West: He’s covered all our solutions. Half his career was global — he lived in London for 10 years. He’s also been very active in asset management, and processing technology. He exudes SEI culture, the collaboration, integrity, innovativeness. The culture was really important for the board.
Q: What does “SEI culture” mean for the people who pay for your services?
West: Certainly a long-term approach. It’s appreciating the fact that everybody is on a team. When you ask somebody for help, they actually give you the help, because we’re all in this thing together.
We’re pretty humble about a lot of what we do. That’s unusual for Wall Street.
» READ MORE: Talking investment strategy with Alfred West Jr.
Q: Wasn’t it hard to attract Wall Street people to work out past Valley Forge in Oaks?
West: It was good to be here! We don’t have the overhead [of Wall Street]. Oaks has been an asset for us. It fits the culture. There are times when we can’t get a particular person [to stay] who wanted to be on Wall Street. They end up coming back.
Q:You compete with tech and banking giants, and specialized rivals. How did you stay relevant through all those tech cycles?
West: At SEI, we’ve had five or six different companies. We have been a different company every 10 years. I don’t know if we chose new businesses, as much as we evolved to them, for our clients’ needs. If we do that, we’ll always be relevant.
Q: Ryan, how did you decide this was where you would spend your career?
Hicke: I started when I was 20. I interned that summer and Al hasn’t been able to get rid of me.
Q: How did you and SEI learn to manage in London?
Hicke: I was the 12th person among a mix of Brits and U.S. expats. We grew so quickly. It was a start-up with the advantage of having an established parent company. The coolest thing was the ability to maintain the SEI culture
Q: Has the board charged you with keeping this company independent?
Hicke: It’s what Al said earlier: We stay true to our premise of listening really well, being out in the market, understanding our clients’ needs and where the market is going, and our ability to reinvent ourselves.
We’re serving, from single advisers, to the largest wealth managers and banks. When we listen to all of them, we have a unique perspective.
Q: Is outsourcing inevitable? Will banks and brokers keep outsourcing services as Vanguard is now doing? Or will they have to go back to building their own tech?
West: It’s back and forth. Swings this way, and then that way.
Q: How many people work at SEI now? And are they remote?
Hicke: About 4,000 people worldwide, 3,500 [are based] in Oaks. There’s benefits of working at home, and benefits to being on campus together. We also recognize the flexibility of the hybrid approach. To work remotely has a lot of value. Flexibility in the work environment has increased dramatically in the past two years, and has enabled us to attract more talent and people.
Q: Can you talk about demands from clients for help in the cryptocurrency space?
Hicke: We’ve been looking at the digital asset space (involving cryptocurrencies). We’ve been working across the company, an enterprise group focused on digital assets, connecting with counterparties. We see it as a segment and a capability that will grow.
Q: How do investors hold custody of crypto?
Hicke: That’s exactly what we’re working on, the custody relationship; how do you price it and report on it? These digital assets don’t always strike a price. We’re trying to step back and look at — how do you trade it, hold it, price it, custody it?
We have some investment management clients launching crypto funds and having us administer those funds. The demand is still low but the questions are high. We deal with many banks and wealth managers, and it’s not something that’s part of their formal asset allocation.
Q: What other growth businesses are on your horizon?
Hicke: On the tech side, as more firms look to the cloud, they want help from SEI. And we’re able to help them from on-premise servers to the cloud. We ourselves are moving more of our operations to the cloud for the past two years now.
We’ve also seen demand around cyber security services. Our SEI Sphere is a single cyber security full data protection platform. It offers a wealth management firm end-to-end protection, email monitoring, protecting a laptop, all the way through the network. Other competitors only offer a single product, like an Arctic Wolf or CrowdStrike.
Al asked me to start that business. We’ve sold it to insurance and tech companies. It’s a quickly growing market, also for small to mid-size businesses.