11 Most Excellent WMToday Blog Posts from 2019

Well, the extended family has finally headed home and you’re debating whether to take down the holiday decorations or wait until the neighbors start complaining. It must be the end of another year! It also  means it’s time for our annual top 10 list of the most popular Wealth Management Today blog posts.

As a bonus, we’ve included one extra post, for a total of 11, since there was a statistical tie for tenth place. We also couldn’t choose which one to include even after a particularly nasty fight among our editorial staff that included some childish name-calling and vague threats about planned April’s Fools jokes. So, I decided that both articles would make the cut to avoid further bloodshed.

After reviewing the now top 11 selections, we saw that our loyal readers had a wide range of interests in 2019 that included conference summaries, industry trends and technology updates.  But which one was the most popular?

Check out the list below to find out.

#11 – Diamond in the Rough: Orion Finds a Financial Planning Gem in Advizrorion advisor services

In the seemingly endless series of acquisitions of financial planning software companies, Orion Advisor Tech (formerly Orion Advisor Services) announced last July that they were acquiring Advizr for an undisclosed amount.

According to Randy Lambert, president of Orion Advisor Tech, they plan to integrate Advizr into their core platform offering and will no longer offer it as a standalone solution. This is a different direction than the one taken by Envestnet and Fidelity after their financial planning acquisitions. MoneyGuide and eMoney are both still available separately from their parent firms’ advisor platforms.

“It’s a value play,” Lambert stated, and they’ll include it at no extra cost to their clients.  This will be welcome news to the 70% of Orion clients that do not already have an active integration with a financial planning application.  They could take advantage of the integrated Advizr functionality as soon as the end of the year, if the predictions of a lightning fast integration made by CEO Eric Clarke come to fruition.

We included Advizr in our last financial planning software shootout, although they may not make the next cut since we have only included stand-alone products in this review. (See 4 Top Financial Planning Software Apps for Advisors)

Orion is definitely looking to prepare themselves to fight in a higher weight class and go up against Envestnet’s ENV2 platform as well as the other vendors that have dominated the broker dealer space including Fiserv Investment Services, Vestmark and Charles River Development.  They want to be a player in the enterprise space.

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#10 – 3 Strategies for Single Family Offices to Avoid Becoming Obsolete

Every wealth management should be concerned about the market passing them by if they do not make continued efforts to adapt to changes in client expectations.  Single family offices (SFO’s) are often slower to adopt digital technology than multi-family offices (MFO’s) since they are more likely to consider it an expense rather than an investment in the future. This is especially true for those that are still controlled by first or second generation family members. If they do not change they risk losing the third generation who are more technically adept to the MFO down the street that offers a modern digital client experience.

A recent survey of 103 family offices showed that In the the average age of participating offices was 17 years, but they ranged in age up to 88 years.  Over many decades, the family wealth cascades over increasingly large and diverse generations which also creates more entities and increased accounting complexity.

One big difference is that SFO’s often choose advanced technology for its ability to increase communication with their family members while MFO’s are looking for technology that can help them scale.

A panel of experts shared their experiences with private wealth clients at the 4th New York Family Office Fintech Summit presented by Family Wealth Report.

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#9 – Charles Schwab’s Crystal Ball Sees Less Technology in the Future for Custodians

It seems that my interpretation of events didn’t hold up well.  Schwab’s divestment of their Portfolio Center business wasn’t a strategic decision to get out of building and maintaining their own wealth management platform.  It was part of a decision to buy another custodian’s technology platform with the acquisition of TD Ameritrade.charles schwab technology

The sale of PortfolioCenter to technology vendor Envestnet was an industry-shifting move as it moved 1,500 advisory firms under the Tamarac umbrella. But it also saddled Envestnet with  20+ year old infrastructure that adds to the technical debt they are still digging their way out of after a string of acquisitions of competitors including Tamarac, Placemark Investments and FolioDynamix.

There have been questions about why Schwab sold technology that is used by so many customers for so little.  (Envestnet said that it was too small to even mention.)  The sellers of assets usually know a lot more about their inherent problems than any potential buyers.

While this deal will bring both revenue and clients, it’s not clear what the additional cost burden will be for Envestnet to support Schwab’s aging tech-stack. It also put into play all of the PortfolioCenter advisors, most of whom were not in the market for a new portfolio accounting system, but will be taking calls from multiple competing vendors now that they’re being traded to Envestnet for a draft pick to be named later.

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#8 – #ItzOnWealthTech Bonus Episode: A Maniacal Focus on Advisor Convenience at LPL Financial

We have an almost maniacal focus around making it easy to manage money, which means making our systems more convenient for advisors. If something is not convenient, why have it in there?”

lpl financial focus

— Rob Pettman, LPL Financial


“If we can get advisors really happy faster, why wouldn’t we just reorganize things to do that?”

— Kirby Horan-Adams, LPL Financial

This was a fun podcast to record since it was recorded onsite at the LPL Financial’s Focus 2019 conference in sunny San Diego.  Unified Managed Accounts (UMA) have been the talk of the industry for many years, but they’re starting to gain traction as more advisors move to fee-based business and look for ways to attract higher net worth clients.

LPL has quietly built out their own turnkey asset management platform (TAMP) offering that has become quite popular among their 15,000+ advisors. This provides not only a nice revenue stream for LPL, but another connection that build advisor loyalty and create inertia to reduce defections to competing broker-dealers.

We also discussed the all-in-one technology approach that has been guiding LPL’s strategy over the past few years. This is the opposite of what most of the other top 10 IBD’s are doing as they continue to outsource more and more of their technology. While previous versions of LPL’s platform, ClientWorks, have failed to impress, the most recent incarnation is a huge step towards the Holy Grail of an all-encompassing system that delivers everything an advisor needs to run their business and is intuitive and makes their practice more efficient.

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#7 – The Day Envestnet Became the King of Financial Planning Softwareenvestnet financial planning

I thought that using a photo of Charlemagne would be a good choice for this article since he was the first ruler to unite the majority of western and central Europe since the fall of the Roman Empire. My opinion was that Envestnet could be considered the kind of financial planning software after their purchase of market leader MoneyGuide Pro.

Many opinions were expressed that Envestnet overpaid. But I believe that the old adage, “you get what you pay for,” holds true. If an asset is unusually cheap, there must be a reason. (See the Charles Schwab crystal ball above)

Jim Collins, the author of Good to Great and Built to Last, would call this a Cannonball Move. Envestnet fired some bullets with eMoney, FinanceLogix, and the MGP+Edmond Walters partnership and used them to calibrate the market. This deal is an empirically validated big bet that will give them massive momentum.

I don’t believe this deal was just for cross selling or better integration — it was 100% a *data play* — MGP was #1 in market share of financial advisors. Envestnet now has access to assets by custodian, by tech provider, positions and tons of customer demographics.

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#6 – 18 Enlightening Fintech Demos from In|Vest 2019

“Why do all chatbots and virtual assistants have female names? It’s perpetuating a negative stereotype.”invest conference 2019

— Dani Fava, Director, Product Strategy & Development, TD Ameritrade Institutional

Fintech vendor Jane.ai took Fava’s criticism seriously since they have since rebranded as Capacity, and also raised $13.2 million. (See Ep 21: Zen and the Art of Artificial Intelligence with Davyde Wachell from Responsive)

Chatbots were a popular choice at Invest Demos this year, with three vendors among the 18 total presenters.

I was blown away by the functionality Capacity has built that allows you to give English language commands inside of other applications such as Slack. For example, while inside a Slack channel, you can call up the chatbot and ask it complex questions such as, “What is the email address for our primary contact at <client X>?” The software will parse your request, go out to the CRM find the client grab the primary contact’s email and return it to you in Slack.

The judges all felt the same way, as they were declared the winners!

I’ve seen Capacity demo their product at other conferences and it just keeps getting better. I believe this combination of AI, tight integration across most of the key systems and deep connections to data stores across the organization will become ubiquitous at most Fortune 500 companies. At least, the ones who don’t want to fade into oblivion.

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wealth management technology

#5 – Assetmark’s WealthBuilder is a Next Level Technology Experience for Advisors

Assetmark became one of the leaders in the TAMP space primarily through their product shelf and white glove service and support. Their technology took a back seat with what would now be considered an old-style website and static pages to manage portfolios and interact with advisors.

This has all been changed with the launch of WealthBuilder, a suite of digital investment and planning tools designed to help financial advisors research and create portfolios in the Assetmark universe and improve client interactions. These tools are free to advisors.

Assetmark, which recently passed $50 billion in TAMP assets after their acquisition of RIA Global Financial Private Capital, has been making aggressive moves to compete with SEI, which has around $65 billion in assets and TAMP leader Envestnet who is closing in on $150 billion. (See Envestnet is Transforming into The Alibaba of Wealth Management)

Since this article came out, Assetmark went public (NYSE: AMK) raising $275 million by offering 12.5 million shares at $22. As of last week, the TAMP had a market capitalization of more than $2 billion, according to Yahoo Finance. Their stock is trading at $29.57, which is close to their 52-week high. It seems that there is strong investor interest in this sector with largest TAMPs by assets — including Envestnet, SEI and Morningstar — seeing significant growth with positive earnings and cash flow.

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#4 – 19 Ideas from the T3 Advisor Conference Your Boss Needs to KnowT3 Advisor Conference

There were a number of themes that we saw repeated throughout the conference:

  • Increasing integration between systems via application programming interfaces (APIs)
  • Product focus on client experience and emotional intelligence
  • Artificial Intelligence

These are five of the biggest innovations and disruptive ideas I saw:

  • Facial Recognition & AI being used to enhance advisor-client communication and potential replace risk tolerance questionnaires with emotion-based analysis
  • Financial Planning Apps building out integrations to marketing tools and mass affluent tools partnering to move up-market into HNW and estate planning
  • Compliance tools becoming table stakes in enterprise wealth management platforms
  • Vendors building out lite financial planning tools to nibble around the edges of the stand-alone applications vast feature sets
  • Custodians focusing more on the client experience of their technology offerings

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#3 – How the Quovo Deal Validates Envestnet’s Vision for Yodleedata aggregation tools

When Envestnet CEO Jud Bergman announced that his company was shelling out just under $600 million to buy data aggregator Yodlee, saying that the market did not approve was an understatement. The firm was blasted by both the press and equity analysts, who scoffed at the 50% premium Envestnet was offering and wondered aloud why they were “buying the cow when you can get the milk for free?”  These factors helped drive Envestnet’s stock price down by 35% the day the deal was announced.

Boy, have things changed since then.

Since that fateful August day in 2015, Envestnet’s revenue has almost doubled (~$800mm vs $421mm) and their stock price has followed suite with more than 100% increase (from Feb 2016).  A steady stream of new product announcements including expansion of their APIs for developing payment solutions and their AI-powered FinCheck app (which won a Best in Show award at Finovate 2017).  Bergman’s vision of a new era where data becomes the unifying force connecting advisor and consumer networks has been validated not only by the stock market, but by new M&A in the data space. (See Envestnet Rebrands ENV2 as a Financial Wellness Platform)

Data aggregation vendor Quovo was acquired by Yodlee rival Plaid for just under $200 million, per Bloomberg News.  This was Plaid’s first acquisition and came on the heels of a big capital raise of $250 million in venture funding.  Plaid quintupled their valuation to $2.65 billion from just $500 million in 2016. But what are their goals with this splashy entry into the wealth management space?

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#2 – Envestnet is Transforming into The Alibaba of Wealth Management

envestnet credit exchangeI believe that Envestnet’s long-term plan is to transform themselves from a provider of wealth management software and services into an Alibaba-like platform that operates multiple financial services marketplaces that eventually generates a majority of their revenue. 

Envestnet currently operates or is planning to launch three lines of business with transactional revenue streams:

  • Manager Exchange – Envestnet doesn’t use this term, but I’m using it to refer to what they call a “network of strategists”.
  • Insurance Exchange – According to their website, this will offer fixed, fixed-indexed, variable, contingent-deferred, and private placement annuities from leading insurance carriers.
  • Credit Exchange – Also per their website, this will provide numerous credit options including consumer loans that are backed by collateral such as securities, real estate, fine art and other assets.

In October 2018, Yodlee launched a product called Risk Insight for Pre-Qualification that would deliver a robust set of data directly to lenders to enable them to quickly pre-qualify consumers for mortgages and other loans. This could help them to filter out bad risks in real time, which will save them money that would normally be spent on credit reports and other authentication products.

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And drumroll please for the number one most popular blog post from 2019…

#1 – Advisor Group’s eQuipt is a Quantum Leap in Onboarding Technologyadvisor group

Operations and business management can act like quicksand for independent advisors, who need to spend more time managing day-to-day operations than their branch network counterparts. This is according to Cerulli who also reported that while advisors overall spent 21% of their time on administrative tasks such as account opening, independent advisors spent 49% more time than did branch network advisors.

A battle has been raging among broker-dealers, RIA consolidators, and RIA custodians to promote their wealth management platforms to independent advisors as being the most efficient. It’s an important decision, since reducing the administrative burden can spur tremendous growth as advisors have more time for client-facing activities.

Taking a page out of the robo-advisors’ playbook, Advisor Group replaced their cumbersome, paper-based account opening process with one that is completely electronic and digitally advanced.  Christened “eQuipt”, it has advanced their platform to be among the top providers known for technical prowess such as Dynasty Financial, United Capital and HighTower.

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That’s All Folks

That about wraps it up for 2019!  Thanks for reading and making WMToday one of the most popular blogs in the industry. We appreciate it!

If you liked this article, please leave a comment or two below.



The Wealth Tech Today blog is published by Craig Iskowitz, founder and CEO of Ezra Group, a boutique consulting firm that caters to banks, broker-dealers, RIA’s, asset managers and the leading vendors in the surrounding #fintech space. He can be reached at craig@ezragroupllc.com