Managing the risk
Juan Pablo Orjuela, Managing Director of CFX Risk Management, discusses how the services offered by Sturgeon Ventures are invaluable for small businesses.
Strategic digital transformation is vital to businesses in a fast-moving technologically driven world. Many companies attempt to manage their data through internal processes, but inevitably their information can become buried deep in Excel spreadsheets as the business grows. At CFX Risk Management, Juan Pablo Orjuela has helped many companies across all sectors find this key information and transform their businesses as a result.
“We help corporate clients with digital not just knowledge systems,” says Juan who started CFX ten years ago. “These systems enable directors to get the right piece of information to make the right decision in a speedy manner.”
In the past decade CFX clients have included a transport company in Turkey, commodities companies producing coffee and sugar, fertiliser companies in Brazil along with airlines and clients on the lending side. “The common denominator is people need information to run their companies properly and that’s what we provide,” he says.
Seeing the opportunity
Juan started his career while at university in Colombia where for his thesis he built a hedging strategy for the Colombia Coffee Federation. Despite exporting most of the country’s coffee to the rest of the world, he spotted that the Federation didn’t actually have such a vital strategy. In the UK for his Masters’ degree, Juan designed a fund for Hargreaves Lansdown in Bristol who then decided to launch it. A few years later Juan ended up at Koch Industries in New York for 15 years, managing property, capital and trading commodities effects, interest rates and equities. Here he built an in-house fund from scratch, including the mental models and the trading strategies for the risk side.
After 15 years, he decided to set up on his own in London. The idea behind CFX was to be able to provide all the tools he had created to manage risk to the corporate world. “It was obvious that many companies just didn’t have tools to analyse risk and see risk as we did it in the trading world,” he says. “I could see an opportunity to help companies understand their business properly and make better decisions.”
Working with Sturgeon Ventures
Seonaid Mackenzie was instrumental in helping Juan build CFX Risk Management, providing valuable advice throughout the process. He engaged Sturgeon Ventures who helped steer CFX through gaining approval as an Appointed Representative Firm of Sturgeon Ventures LLP. “All entrepreneurs in financial services underestimate the amount of effort that it takes to build a company from scratch,” he says. “In that sense, the Sturgeon Ventures team and Seonaid have been very helpful in alleviating some of the pains that you have to go through with regards to being able to carry out regulated activity business within their Regulatory Incubation framework by being an Appointed Representative Firm. That side is covered by Seonaid and her team who take care of it all in a very professional manner.”
CFX is now divided into two offerings, consultancy and software. The original vision was to deliver risk management consultancy, but it became clear over time that the common denominator was the lack of proper information provided by the client. “Sometimes they didn’t even have it,” Juan recalls. “Or they would send a few Excel spreadsheets with different versions of the same information and various owners of the information. It was difficult to distil everything into the absolute truth, so it became obvious after some time that if we could offer a digital tool to the client, life would be much easier for us in terms of doing our own work for them.”
A second company CFX Advanced Analytics, provides software as a service or SAAS, initially as purely FX and then expanding to commodities, interest rates and credit modules.
With the information side fully digital, Juan can now spend time with clients building the risk management side of the businesses, in particular reconciling the commercial and Treasury sides and adding more value. “At the beginning the clients often don’t see the value here but we help them identify their risk appetite and give them tools to help with the hedging.
In Latin America, the margins are much bigger than Europe, so we’ve enabled our clients to have better tools in order to negotiate better with the local counterparts, saving a significant amount of money for some of them. We’ve also helped introduce clients to counterparts abroad which offer them better pricing terms and we’ll continue to do this because the opportunities are quite significant.”
With such a distinct offer, Juan sees CFX as the only independent company that covers the three spaces – FX, commodities and interest rates. As he says of Sturgeon Ventures; “It’s good to have Seonaid on side as she offers much more than a straightforward service and her advice has been invaluable.”
Websites:
https://www.cfx-advancedanalytics.com
For further information on any of our ARs or ventures, please email hello@sturgeonventures.com
