How did you come to be running the Morningstar office in Sydney?
I have been with Morningstar 11 years, starting as an equity analyst in Chicago, becoming a fund analyst, then head of news, and then editor of its flagship newsletter, Morningstar Mutual Funds, which was published fortnightly. While running that, the opportunity to run the Australian business came up and here I am. I’ve always been fascinated with Australia and that was even pre-Crocodile Dundee.
What was the original intention of the Aspect Huntley acquisition and how have things progressed so far?
There were two main reasons we did the deal. We think on the research side there is a greater need for one-stop shopping for advisers’ research needs. We’re not the kind of company comfortable in outsourcing. We think you put your brand on the line, so an acquisition made sense.
The second reason was we thought there was an opportunity to combine editorial, equities information and fund information and have some real powerful products in the adviser channels. The first example of that was the InvestorDaily site, which just launched and will be expanded in the coming months to include more fund content. We think it can become a real destination for advisers. One of the things we will be working on later this year will be a retail investment site, which will contain independent editorial content, fund and equity information and portfolio tools.
Has it been difficult to manage the conflicts from the researcher point of view?
In this sort of business there are always going to be some sort of conflicts and it depends on how you manage it. There are conflicts between sales and editorial and sales and analysis. We have tried to form a strong culture where people can’t place undue influence on reporters and analysts. Somehow I think the situation – with analysts and reporters – is similar. Analysts we have are bright, cynical and intellectual, curious people and fund managers don’t always appreciate that. There’s always a strong culture of independence.
I understand why you bought the Aspect Huntley equities business and while it’s not hard to understand the synergies there, people are always asking why the InvestorInfo business?
We had several conversations with Aspect Huntley and could have bought it without InvestorInfo but we think there’s a high amount of opportunities in the content side of the business in Australia. We have had numerous approaches to buy the [InvestorInfo] business and we don’t have any intention of selling it.
Do you feel there’s been any clash of culture between Morningstar and InvestorInfo?
I’ve been pleasantly surprised by the lack of culture clash and I think a big part of it was that the analysts and reporters have a lot in common. At the heart of it we have the same interest to help people make better investment decisions.
Morningstar is an international brand, and you were originally from the Chicago office. How is business carried out differently in Australia?
One thing that’s different between the markets is that people are much more concentrated here – mainly in Sydney and Melbourne – so there are many more personal relationships. In the US, markets are spread – New York, Boston, Houston, Denver, Chicago, LA, San Francisco, Philadelphia – it’s harder to form the same sorts of relationships when people are so spread out. Beyond that, I don’t see a lot of difference. I think part of it is that people in the Midwest of the US are more laidback than New York, so Chicago and Sydney are more similar in some ways than Chicago and New York.
A lot of the US expats here are from the Midwest and they find it an easy transition.
Is there any Morningstar media ownership anywhere else in the world? Are there intentions of moving into that part of the business in a bigger way?
Morningstar is about to launch an adviser magazine in the US. Our publications in the past have focused on newsletter products. However, publishing is a passion of the company’s owner, Joe Mansueto. He personally owns Inc and Fast Company magazines and is a part-owner of Time Out Chicago. The adviser magazine will be published later this year and will go out to 50,000 advisers.
How long have you been in Australia? How are you generally treated as a Yank in Australia? Did you find relocation difficult and what’s been the hardest thing to adapt to living in Australia?
I’ve been here four years and I’ve been treated very well. Except for the occasional cab driver who thinks I’m personally responsible for US foreign policy, I find it easy. My wife found it more difficult mainly because of family issues. My favourite food is Mexican food and there’s not a lot of Mexican food here and I also don’t like watching football (gridiron) games at 3am.
