| TSC iLAB |
| Technology advantage |
| Innovation Goals |
Example: K2 Transparency
Green Technolgy For Real Assets
At Twin Summits Capital, we recognize that the primary aim of innovation in business is to positively impact a company’s financial performance and ensure its sustainability over the long term. To achieve this, we established our Innovation Lab (iLAB), whose role is to continuously review the operations of our Alternative Investment Management (AIM) arm, while exploring ways to enhance performance and generate excess returns (alpha) for our investors. This is accomplished by leveraging new technologies, platforms, products, and by identifying new partnerships for AIM to engage with.
Our iLAB team is often presented with some of the most complex challenges in our industry. They approach these challenges by breaking them down into fundamental elements, reverse-engineering solutions from first principles, and then rebuilding these solutions from the ground up. We firmly believe that the future of institutional investment management will not only be in the hands of traditional investment professionals but will also heavily involve data scientists and programmers. These tech-focused professionals can extract additional insights from new data sources and develop faster and more powerful tools for investment managers to utilize.
By having AIM and iLAB operate closely together as a cohesive unit, we can leverage a broader range of skills to obtain both a competitive and comparative advantage. This integrative approach underscores our commitment to staying ahead in a rapidly evolving investment landscape.
In a rapidly evolving world where technology is increasingly woven into our daily lives, we understand the urgency to embrace emerging technological advancements proactively, rather than reactively. This approach enables us to stay at the forefront of the industry. At TSC, technology is a cornerstone of our investment process. As information systems become faster and more efficient, especially with the advent of Artificial Intelligence and similar advancements, we anticipate that the role of technology will only grow in significance. When considering a new strategy or product, one of the first questions we pose to ourselves is:
“Do we possess the necessary technology and information system to execute this strategy (A) better than our competitors, and (B) more efficiently than our competitors? If the answer is no, then what steps do we need to take to reach these goals? If the required technology or software does not exist, can we develop it ourselves?”
We firmly believe at Twin Summits that by having customized information systems for each of the strategies we operate, and by harnessing new developments in computing such as ‘Big Data’, we can analyze and, more importantly, understand data faster and better than our competitors. This approach gives us a clearer understanding of the markets we operate in, enabling us to make superior investment decisions compared to our competitors. In essence, our tech-forward philosophy amplifies our competitive advantage and underpins our ability to generate value for our investors.
Twin Summits Capital’s Innovation Lab (TSC iLAB) serves three main functions:
(a) TSC iLAB develops new technologies and platforms to enable the Alternative Investment Management (AIM) arm of TSC to operate efficiently across the value chain for its active strategies. One example of this is K2 Transparency, Twin Summits’ disruptive real assets platform that operates across the entire lifecycle of an asset (“cradle to grave”).
(b) TSC iLAB conducts internal development projects aimed at identifying new investment strategies for AIM. This is achieved by seeking out exploitable opportunities in the market, with a current focus on real assets.
(c) TSC iLAB also undertakes external mandates and supports Twin Summits’ external partners in areas where they wish to increase their exposure or concentration, but are encountering difficulties in deploying capital.
TSC AIM and iLAB work in close collaboration, leveraging each other’s resources to enhance the effectiveness of their operations and investment strategies.
K2 Transparency is a critical tool utilized by our portfolio managers in executing Twin Summits Capital’s direct real estate strategy, with a current focus on Single-Family Rentals (SFR) in the US. The leaders of Twin Summits had grown dissatisfied with the limited software options available in the marketplace. They found that existing alternatives were either too slow or did not provide sufficient information for our portfolio managers to take advantage of the inefficiencies in the diverse markets they invested in.
In response to this, Twin Summits made the decision to create a custom real asset acquisition and asset management platform. Given that a significant number of our team members possess programming skills and have prior experience in developing apps and investment platforms for private equity and hedge fund strategies, it was decided to develop the software internally. The outcome is a highly efficient and streamlined platform for direct real estate acquisitions and asset management.
K2 Transparency assists our portfolio managers and analysts in identifying investment areas, right down to individual subdivisions and Homeowners Associations (HOAs). This granular approach can potentially deliver above-average market yields, capital appreciation rates, and potentially generate alpha (excess returns). The tool embodies our commitment to utilizing innovative technology to drive superior investment performance.
At TSC we are committed to researching and implementing green technologies to limit environmental impact and increase the sustainability of our operations. We understand the critical role of eco-friendly solutions in shaping the future of real assets, not only to minimize carbon emissions but also to unlock new investment opportunitiesTSC iLabs therefore also explores how advancements in green tech can be integrated into our existing strategies, while simultaneously scouting for emerging trends and opportunities in the green technology sector.
One of the primary areas where green technology can make a significant difference is in the real estate sector, particularly single-family homes. The implementation of renewable energy systems, such as solar panels, can drastically reduce a property’s reliance on carbon-intensive energy sources. Energy-efficient appliances and smart home systems, such as programmable thermostats, further contribute to reducing energy consumption. In the UK, improving Energy Performance Certificate (EPC) ratings through these measures is a tangible goal, leading to more sustainable homes and potentially higher property values.
However, the potential of green technology extends beyond residential real estate. Commercial buildings can adopt smart building technologies, optimizing energy usage through automation. Infrastructure can be designed or retrofitted with green roofs and walls to reduce heating and cooling demands, while rainwater harvesting systems can contribute to water conservation. Through our research at iLAB, we aim to uncover and harness the potential of these green technologies, positioning Twin Summits Capital at the forefront of sustainable real asset investment.