Ep. 193: A Growth Platform is the Glue in Your Tech Stack with Aaron Klein, Nitrogen Wealth

Come on in and sit back relax, you’re listening to Episode 193 of the WealthTech Today podcast. I’m your host, Craig Iskowitz, founder of Ezra Group Consulting and this podcast features interviews, news and analysis on the trends and best practices all around Wealth Management Technology.

I’m pumped for my guest of this episode, which is my good friend and industry leader, Aaron Klein. Now, Aaron needs no introduction, but I’m going to do a quick one for him anyway. Aaron is the co founder and CEO of Nitrogen Wealth the industry leading software company that was formerly known as Riskalyze. Aaron is very well known, he seems to be everywhere. They’ve done a fantastic job creating a rebranding risk tolerance from a backwater that no one wanted to talk about, into a marketing and sales juggernaut that took the market by storm and now has the largest market share in the  risk tolerance category.

They also launched a number different applications around risk tolerance, including lite financial planning, investment analytics, RegBI and a few others. They recently combined that all together into what they’re calling a growth platform. Which is a new product for advisors. And the $64,000 question is, will the industry embrace it?

But before we get started, if you are an executive of a wealthtech firm that’s selling software to RIAs, broker-dealers, asset managers, TAMPs or others, then you should run, not walk to our website, ezragroupllc.com and fill out the Get in Touch form on the home page. Our experienced team can assist with software vendor evaluations systems integrations, improving operational efficiency, software implementations and a whole lot more. You can take advantage of our free initial consultation offer by going to EzraGroupllc.com. Now, let’s kick this thing off!

Topics Mentioned

  • Rebranding to Nitrogen
  • Focusing the New Product Offering
  • Without Good Integrations, You’re Dead
  • A Growth Platform is Tech Stack Glue
  • What is Sales Enablement and Why Do Advisors Need It?

Episode Transcript

Craig: My guest today is Aaron Klein, co-founder and CEO of Nitrogen Wealth. Hey, Aaron.

Aaron: Hey, great to be with you.

Craig: Great to be with me again.

Aaron: Yes. Second time on the podcast and the last time we did this there was all this breaking news and we just like talked about the news instead of talking about what you or I actually work on. I’m excited about this. I’m excited about this. We’re going to have a good conversation today.

Craig: The news is always more interesting than what we have to talk about. But now it’s summertime, so there isn’t as much news. But before we start, I know everyone listening already knows you and already knows your company but give us a 30-second Nitrogen Wealth elevator pitch.

Aaron: Sure. I had the great honor of having the chance to help co found this company and service as CEO since 2011. Today, nitrogen serves tens of thousands of financial advisors by equipping them with the growth platform for wealth management firms and that all starts with the risk number that we invented back in 2011.

Aaron: The idea that humans just have this incredible ability to sabotage their investing and if we can help them understand who they are, and connect them with that and show them the alignment that we create with that ultimately helps them be successful investors, stick to their plan and stay invested for the long run.

Aaron: Financial advisors have some interesting challenges with growth. I think of growth by the way, as two sides of the coin. Acquiring clients and retaining them and maintaining their expectations. We’ve been pretty excited to spend the last decade building out this growth platform for wealth management firms, helping them drive the process of turning leads into meetings and meetings into valued clients. Clients into referral champions for their firms. That’s the core of what we do today and excited to talk about

Craig: Look, man, just because we’re friends doesn’t mean you can blow up the podcast by just talking as much as you want, I said 30-second elevator pitch, you just blew past that.

Aaron: Alright, sorry. Apologies.

Rebranding to Nitrogen

Craig: Let’s talk about the the biggest news for your company this year was rebranding to Nitrogen Wealth and the growth platform. So that was a big move, and I predicted it many years ago.

Aaron: You did.

Craig: I don’t want to talk specifically about that, but underneath that you completely changed the product set. That’s something we pay close attention to at Ezra Group in terms of all the different technology around the advisor tech space, and that you’ve changed what technology you are promoting and how you’re presenting it and how you’re organizing it. So now it’s client acquisitions, client engagement and compliance are the three areas you’re promoting. Why did you do that and how did you come up with those particular areas?

Aaron: I think it was a realization Craig that the rebrand was a moment for us to say, hey, we’ve got to step back and take a look at what we’ve actually built over the last decade, and what we actually do for financial advisors and wealth management firms. The truth is that we built risk first. It’s still at the center of what we do. I just talked about it a second ago. Or I guess, 45 seconds ago. We built the Risk Number we built the ability to do risk alignment. That was kind of the first set of capabilities that we came out with meaning the company after it, Riskalyze.

Aaron: We then embarked on this decade of building the growth platform. For wealth management firms and a much broader set of capabilities to drive client acquisition to drive retention to drive compliance workflows and analytics across all of that. We would walk into large firms, and they would say, well, listen, we’ve certainly heard of you, you’ve got a great reputation many of our advisors love you. We don’t understand why because we don’t need another risk tolerance documentation tool around here. That’s not what we need.

Craig: Advisors love you but we just don’t understand why.

Aaron: How do you want to have them wanting to use a compliance tool, it makes no sense. Branding is such a double edged sword, right? Somebody very wise said to me, if you do it poorly, you can change your brand to mean anything you want it to mean, if you do it well, you’re stuck in the box you created for yourself. And it’s as if Jeff Bezos named that famous website onlinebookstore.com, people were just not going to see. That extended all the way to the FinTech map that you and Michael Kitces have built. We’re out of the risk tolerance box and rightly so we’re a company named Riskalyze. And the truth is, is that we drive growth, call it sales enablement, if you want to call it client success if you want. There’s a lot of different labels you can put on it. But at the end of the day, we’re driving growth for wealth management firms.

Aaron: The rebrand to Nitrogen was about saying wait a minute, like we have named our company after the means to the end of growth and risk is still an important means to that end. But we need to name our company after the essential element for growth on our planet and that’s where Nitrogen came from.

Focusing the New Product Offering

Craig: But what about the products you’re selling? You have built out from risk you’ve built a lot of ancillary products, like meetings and checkins and then you branched out into lite financial planning, and then you expanded into investment analytics. So how did you come up with these different categories? Why client acquisition client engagement compliance as your main selling points?

Aaron: When I looked at the, the wealth tech stack, and I look at the at the industry ecosystem. What I’ve felt for a long time is that we have this hole right in the middle of it. You’ve got like, whatever is bringing you leads on one side, your marketing automation, or marketing system or whatever. You’ve got your asset platform that you’re using to manage all of these assets on the other side, and you’ve got your CRM, and you helped me think about that, by the way with the CRM being the foundational system of record for people along the way.

Aaron: But there’s this piece in the middle that I’ve always felt like the industry has been missing. It’s interesting because there’s a perfect analogy outside of wealth tech, and I often feel like our industry tends to operate like a decade in the past. One of the things I’d like to see us do is to kind of leapfrog our way into the future. If you go out there to the broader rest of the industry served by this SaaS software space.

There is a distinct section of technology that sits on top of CRM, and sits outside of marketing automation sits outside of systems of record, like ERP or asset platforms. And they call it sales enablement. They call it client success. I rolled those two things together and call it a growth platform but it is tools like SalesLoft and outreach and, Totango and Gainsight that helped companies engage with prospective clients and then retain them and nurture them and turn them into referral champions.

Aaron: I’ve just looked at this and said, what our theme and our focus is, and this is not to say that our company has never built anything outside of this focus. But I would tell you, we are more focused today than we ever have been before on this central tenant, which is we exist to help financial advisors and wealth management firms drive leads into meetings and meetings into value clients and clients into referral champions.

So where does that take you? Well, it certainly starts with risk. It certainly takes you into proposals and stress testing and portfolio analytics. It certainly will take you a little bit into light planning for sure to think about risk capacity and is this overall solution gonna meet my goals?

Without Good Integrations, You’re Dead

Aaron: By the way, you want to use integration to delve much deeper into comprehensive financial planning. We have great tools in this industry to do that already. You want to use great integrations, to be able to to pull models and things like that in from asset platforms, and then push those assets over to be managed in asset platforms.

Aaron: But at the end of the day, our industry needs a purpose built growth platform that is going to help financial advisors and wealth management firms at scale drive that process of lead the meeting to client to referral champion, and we haven’t had that we’ve had asset platforms that try to do all things to all people. We’ve had a couple of small points solutions that people try to patch together and kind of stuff a square peg into a round hole. And I don’t think it’s been working for our industry. And I think that’s why Nitrogen has been so successful over the last decade.

Craig: When you talk about great integrations, that’s something we always talked a lot about having built our Wealthtech Integration Score last year, with of course, Nitrogen getting one of the highest scores possible.

Aaron: We’re very honored. We appreciate that. 

A Growth Platform is Glue for Your Tech Stack

Craig: What other types of besides pulling models from asset platforms and where the growth platform fits between marketing, and on top of the CRM rather than next to the CRM. How do you see that working that will you become the glue that fits that goes between marketing and CRM and the acid platform and other tools for actual planning and such or are you just another cog in that wheel?

Aaron: No, I think that’s true. I think that we’ve largely become the workflow glue that advisors used to take that lead and turn that lead into the meeting, and then they leverage our tools and capabilities in the meeting to tell their story and help help those people see perhaps that they’re not aligned on risk, perhaps they’ve got an inefficient portfolio, perhaps that, you’d go into into the analytics and there’s not a lot of diversification in the portfolio. Tax drag is a new capability that we’ve rolled out that helps you illustrate your competitive advantage as a financial advisor.

Aaron: You’ve got all those different vectors of how you compete as a financial advisor and and turn meetings into valued clients. And then you’ve got the tools and capabilities to continue to drive that engagement in a consistent way once you build trust with a client using great analytics like the risk number you need to continue to reinforce that trust and then you need to turn that trust into referrals to get that growth flywheel spinning for your business. And of course, all of that feeds assets into asset platforms.

Aaron: From an integration standpoint, I think your point is well taken on the glue because I’ll put it this way. What we see an awful lot of the time is a lead might pop into Nitrogen from the lead generation questionnaire on your website. You engage with that person, they say, Yeah, I’d like to go ahead and do a meeting with you. You do a meeting with them and you you gather data like you know, what’s their risk number? Let’s understand your current portfolio, understand its risk number and its analytics. Let’s understand what they want to do what they want to accomplish. And let’s put together a bit of a proposal for how we might serve this person differently.

Aaron: Of course, in that follow up meeting where we’re trying to bring them on board as a client, typically, a lot of clients start to delve a little bit deeper, they’re looking maybe at the retirement map on the screen, and they’re like, well, that’s super interesting.

But what would happen if I wanted to send Johnny to Harvard and needed to pull some money out? And that’s where the advisor can say, well, listen, I love to do comprehensive financial planning with my clients. That’s a much deeper process. It’s going to take us a good hour to collect all of that and go through that. We could do that if you come aboard with me like we could do that in the next meeting and delve into a much deeper financial plan. Maybe I have a MoneyGuide personally, maybe I’m an eMoney person, RightCapital person, however that works.

Aaron: So advisors tend to jump out of Nitrogen into a number of other tools and we love building integrations with those tools. To delve deep into something we have a lot of advisors love to jump out to a Holistiplan or FP Alpha or some of these other tools that engage clients on different aspects of the of the planning experience. But typically, that’s going to come back in because it’s going to ultimately impact the proposal. It’s going to ultimately impact how the client gets invested.

And then from Nitrogen, they’re going to push that over to the asset platform for implementation. So that’s the glue that I think you’re talking about there from an integration strategy. And I think that that’s largely we’ve what we build and continue to build.

Aaron: I think the big frontier in the futures, how do we make those workflow integrations seamless? I recognize we’ve done a lot deeply appreciate the recognition of that with the the Ezra Group Integration Score. And yet I feel like I’m our harshest critic, because I tell the team listen, we want seamless workflow integration. So to me that means when a CRM pops up and says you need to do this for this client, I don’t want you to go to Nitrogen and start searching for that client name and go three layers deep, I want to deep link in the CRM that takes you straight to that workflow inside that climate Nitrogen. That’s where we get to the world of seamless workflow integrations, and we’re just not there yet.

Craig: You’re speaking my language. And that’s one of the reasons why we design the methodology around the Integration Score to encourage vendors to build seamless integrations, more robust and deeper integration. That way so you can build 100 Single Sign ons, you’re not going to score as a vendor who builds one seamless robust integration, which we consider low level five, we scored a five on it. So that’s where we’re going with that.

Aaron: I’ll put it this way. I feel like you can always figure out how to make those better. Our aim is to push that up and raise the bar so that level fives require a whole different level of seamless workflow integration and we hope to bend the as regroup integration score curve in that way.

Craig: Do you remember the movie Spinal Tap?

Aaron: Yes. It’s been a long time.

Craig: There was one scene where he was showing the the, the amplifiers he goes, “see mate, this one goes up to 11”. And they said why don’t you just make 10 louder? “No, but see, this is 11.”

Aaron: That’s great.

Craig: Back to sales enablement, that’s a new term for advisors. It’s a new term Michael and I added that to the map, we actually converted what was proposal generation category into sales enablement. Thank you very much. So you drove that.

Aaron: Thank you. Appreciate that.

What is Sales Enablement and Why Do Advisors Need It?

Craig: Nitrogen drove that and it’s something we are sorely lacking. There isn’t a lot of that in our industry. How are you helping advisors and broker dealers and banks or the firms that are are looking at your platform, understand how sales enablement fits into their business?

Aaron: I think it’s so crazy. It’s even more critical for our business than it is for other businesses and here’s why. We are one of the few industries I can’t honestly off the top of my head think of another one where we put people who don’t want to be salespeople, we thrust them into the role of being the growth engine for their firms. The number one college degree for a financial advisor is finance. The number two is economics. These are not people who wake up every day and go, I want to sell something to somebody like that. That’s not what they get excited about. They want to be great practitioners of advice.

Aaron: I do think that a lot of what nitrogen success has come from is that is that we say well, in the process of equipping you with great tools to provide great high quality advice, we’re also sneakily turning that fiduciary advisor into the growth engine, a consistent growth engine for their firms without having to twist them into the salesperson that they don’t actually want to be. To me, that’s what great sales enablement will do. It will enable people to drive growth through the process of delivering great advice through the process of driving great prospect meetings. It’s going to enable them to deliver that kind of outcome.

Aaron: From a workflow perspective, what does that mean? Well, I think it means like having some capabilities to engage with leads and turn them into meetings. That’s a big deal in our industry. We don’t do that in a consistent way. I sit on the board of Snappy Kraken, great marketing automation tool for financial advisors, and one of the number one complaints Snappy Kraken can get is, well, I’m getting all these leads, and I don’t know what to do with them.

Aaron: A big part of what you might say sales enablement is about is about giving the advisor the tools to engage with those leads. Basically, we’ve got to create a sense of intrigue among these clients, why do I want to take my precious time as a prospective client, and actually meet with you as a financial advisor? I either need to have a tremendous amount of pain in my financial life, or I need to be intrigued by something that could be better or that I’m worried about or that I sense an opportunity.

I would say what Nitrogen has done in an elite way over the last decade is is create is helping financial advisors create that sense of intrigue with prospects of going well, it’s a very simple, intriguing question, Craig, what is your risk number? I don’t know what my risk number is, that might be in the in the email signature from the advisor. It might be a questionnaire I see on their website, it might be something that the would that the advisor sends me you know, and so, I became a lead through something like Snappy Kraken or FMG and then you know, somebody using Nitrogen engages me with this, what is your risk number question, I go through the process and it goes, well, Aaron, your risk number is 42. I go, interesting. That immediately sparked to the question what like, what is the 42, is that good, or is that bad?

Aaron: Well, the key question is, is how does that match up to my portfolio’s Risk Number? That’s the real question, because that tells me whether or not my portfolio is the right way. This leads me to be a little bit worried, I’m sitting there going like now I understand why my portfolio might be jumping around a little bit more than I want or expect. That’s what leads the person to schedule the meeting with the advisor and actually get the advisor getting the position to actually turn that meeting into a new value client.

Aaron: So this is the process of sales enablement. I just went down one possible path, I would argue there’s a thousand possible paths of how that happens. But by giving advisors a set of tools to do that, not only can we help financial advisors be more successful, but wealth management firms can drive that at scale because we don’t have consistent growth processes across large wealth management firms either. A lot of them have invested in great marketing automation at the front end to create leads but we are a personality, relationship based personal business. And if financial advisors are not doing those growth activities at scale, we’ll never see the results in the wealth management business that we need to see.

Craig: Walk me through a practical example of how an enterprise firm that’s leveraging Nitrogen’s growth platform uses it to drive growth.

Aaron: There’s one firm that just pops into my mind that we rolled Nitrogen out to over a thousand advisors across the firm. And you know the battle quite well, Craig, for large firms. All these firms have to sit there and go, How do I get technology to be adopted in my firm, that’s a huge battle. And for some firms, it really depends on their on their model on their business model on their affiliation model with advisors, some firms have the ability to mandate things, okay, this firm that I’m thinking of, actually had the ability to go and say, Hey, listen, advisors like you’re going to use this process.

Aaron: You really can’t write business in our firm. You can’t bring new clients aboard unless you use nitrogen to kind of take the prospective client through the process and bring them on board. Some firms are like yeah, not our model. It’s our business model not our affiliation model, we are not really in a position to mandate that advisors use a particular process. But we will encourage it and recommend it.

Aaron: So what we try to do when we look at those two different kinds of firms is we say, first of all, we love when firms actually can’t have the ability to kind of mandate process because I can tell you, those are the firms that get the greatest results. Okay, and the most consistent results. The ones who can’t we try to equip those firms with the insights to help them persuade advisors as to why they’re going to get better results in their businesses and they can prove with data here are the advisors that are that are actually growing the fastest have the happiest, most satisfied clients, and they’re the ones who are actually using their undertaking these activities in Nitrogen to drive these results.

Aaron: So back to that firm, they rolled it out, they mandated the process. What that means is, is that every one of the advisors at this firm is is running every single one of their prospecting meetings with Nitrogen, okay? Because ultimately they have to end up with a risk number for the client all documented in Nitrogen and they have to end up with a proposal for how they want to invest the client all documented in Nitrogen and signed off by the client and Nitrogen. They use it consistently in their prospect meetings. And wouldn’t you believe it like this firm went from 43% of their prospect meetings, turning into clients to 92% of their prospect meetings turning into clients. That’s an incredible increase. I mean, it’s 113% increase in the meeting to client conversion rate. You can imagine the impact across a thousand advisors on the revenue of this firm. That’s a pretty fantastic case but that was that’s their numbers coming back to us.

Craig: I’m speechless, I am without speech. 43% conversion to a 92% conversion rate.

Aaron: Now let’s be clear, I wasn’t talking about lead to meeting. Okay. So it’s not the conversion rate from all the way from the top of the funnel to the bottom. But I’m talking about once I’ve gotten the person intrigued into doing a meeting with me, I’m going to go through the meeting process and yeah, that this firm went from 43% to 92%. By standardizing their growth process with Nitrogen across the firm.

Craig: That’s still pretty impressive I gotta get out, I’d like to know the lead to prospect to conversion but just from prospects to conversion, that’s an impressive number. I want to move into another part of the discussion. Nitrogen Wealth came out with the growth survey, you interviewed or surveyed over a thousand advisors at RIAs, broker dealers, hybrids, which I thought was, it was an impressive number. And you came up with some interesting data from that. Can you share a little bit?

Aaron: Absolutely. We’re gonna do this annually now. We’re really excited about it because we had such a great response to it. And so the first annual nitrogen growth survey, as you said, over a thousand, respondents and 45% and were RIAs, the rest kind of spread across the IBD and employee and bank channels, we serve firms in all of those categories. 38% of the RIA firms were $100-500 million firms, about 10% were billion dollar plus RIA firms. It’s a pretty good picture of the industry as a whole.

Aaron: What I thought was super interesting is firms said that the biggest impediment to growth was the lack of a consistent growth process. Okay. That’s the number one issue that they said was the biggest impediment to growth. And what was interesting is we kind of split these firms that we said, okay, the ones that are growing over 20% a year we call them hyper growth firms and the ones growing less than 5% a year we call them slow growth firms. Firms using Nitrogen were already two times more likely to be hyper growth firms and those who weren’t. But what’s really interesting is it’s the firms that were using us for about a year had a 60% chance of like shifting into hyper growth mode. That’s the impact that using a purpose built growth platform was having on their lead to meeting and beating declined conversion rates. And I think it’s it just kind of demonstrated improved the case that we’ve been making for the last decade.

Craig: So the growth numbers were self reported.

Aaron: Yes, correct.

Craig: Requesting the firms are telling you what the growth is. Absolutely. And there were some that said, Hey, we’re only growing to five or growing less than 5% a year.

Aaron: That’s right.

Craig: Now where do you get the thousand companies, they weren’t just Nitrogen wealth clients, obviously.

Aaron: We went out to the market as a whole so they weren’t just clients of ours. I would note as well that we asked them for that growth number. It was self reported but we asked them to go back and like make sure that they that they got an accurate number from their ATVs in their in their growth numbers and not just like off the off the top of your head and we tried to go back and spot check it a lot but it matched up with what we can see from industry data as well.

Craig: So like 27% Looking at you’re looking at a report that 27-28% were slow growth, 15% were hyper growth. The rest in the middle.

Aaron: Yep.

Craig: Gotcha. How did you come up with two times more likely to hyper growth if they’re using your product? I’m sorry. RIAs using Nitrogen Wealth are two times more likely to be hyper growth.

Aaron: Well, so we went and took the respondents to the survey and we figured out which of them were clients. But what we discovered was the firms using us were two times more likely to be in the hyper growth category than they were to be in debt in that slow growth category.

Craig: Meaning there was twice as many firms that are Nitrogen clients in the hypergrowth?

Aaron: So think of it this way we slice the thousand respondents out for which ones are Nitrogen clients and which ones are not. And if you were the Nitrogen client bucket, I don’t have the exact number off the top my head but you were two times more likely to be hyper growth than you were to be slow growth. If you compare that to the group of clients that were not Nitrogen clients.

Craig: Yeah. Well, it’s interesting. I mean, I know I’ve heard the numbers at your conference. Advisors having larger books of business if they’re using your product or not. So your code is a track you’ve got a more than just one year track record here.

Aaron: That’s for sure. By the way, this whole growth survey online people can download it. Look at all of the all of the the background of the survey and it’s at nitrogenwealth.com/growthsurvey.

Craig: Another area I thought was interesting, even though there’s both slow and hyper growth, you think they’d be very different. They answered a lot of the questions the same.

Aaron: It was interesting. Absolutely,

Craig: As they said, the most important factor in firm growth, client satisfaction and retention. Both slow growth and hyper growth firms said that was the number one answer, although hyper growth by two to one said lead generation was number two. Where slow growth said no, it’s not.

Aaron: It’s kind of interesting. Well, first of all, that would tend to tell you that Hyper Growth firms are right in that regard. I was not wildly surprised by that answer. And I love the answer, because first of all, it shows you the heart that our industry has that financial advisors have for serving their clients well, and the belief that you can’t grow effectively as a wealth management firm if you have a massive leaky bucket and you’re not satisfying your clients and retaining them and secondly, that the number one source of of leads and prospects for wealth management firms are referrals, so if you’re not doing a great job satisfying retain your clients you’re really going to be missing out on the on the biggest part of the growth flywheel for firms, which is turning great value clients into referral champions that actually bring another one or two or three clients into the firm.

Craig: That’s important. Yeah. Referrals are incredibly important for almost every wealth management firm. Is there a specific part of your platform that helps advisors to drive more referrals?

Aaron: And we’re actively thinking about how we can do that a little bit more directly, but I would say that check ins has been one of the biggest drivers of referrals that that I’ve done, I’ve seen and the way that it works is this, you know, for those who don’t know about the check ins feature, basically, it’s a very relatively simple two questions survey that advisors are are leveraging to keep their finger on the pulse speed of client psychology between client reviews.

Aaron: You’re able to get a sense of like, how’s the client feeling about the markets positive or negative? How’s the client feeling about their financial future confident or anxious? And it’s a really great way again, to understand if this is a client that you to reach out reach out to because they’re, they’re frustrated, upset, nervous. This is a client that maybe is feeling good about the markets but anxious about their financial future. That means you’re not really aligned with their advisor on their plan. But it’s the it’s the clients who are answering kind of like green green, right? They’re positive about the markets. They’re confident about their financial future or even red green. They’re nervous about the markets, but they’re confident about their financial future. Those are the ones that advisors will typically follow up with and say, Listen them online, great to hear from you glad things are going well. Glad you’re feeling confident about your financial future. Sounds like we’ve got you set up well for your plan. If there’s anybody in your network that you think I could help get into the same position, but like more than happy to help I’ve got room for a client or to you know, to add to the firm and so happy to help anybody you want to refer our way. asking for referrals is the number one way to get referrals but many advisors feel really awkward because they don’t know if it’s a good time to ask for referrals and check in sets them up with that data point that allows them to go ask for the referral at the right time.

Craig: Advisors need all the help they can get. So they can they can know the right time to ask for a referral. I think that’ll help. I think tools like Nitrogen, I’ve said this before that advisors aren’t all the same just like people aren’t all the same. There’s some advisors that are more empathetic that are more passionate, more tuned in to their client’s needs than others and those advisors have always been more successful because they have those innate abilities to interact with people because it’s a people business, as you mentioned. We’re a personality, relationship based business and there are some advisors who got their finance degree or their comic strip but and they never were taught how to be personable, build relationships, and now they’re thrust into this job.

Aaron: So I think tools like Nitrogen and other tools in the category can sort of level the playing field by providing prompts, nudges, insights, reports to the advisors say here’s what you should be doing. Here’s who you should be talking to. Here’s how you should be nurturing those clients along do you think that’s something that you see happening, that advisors sort of level out, and how they how they perform?

Aaron: Yeah, I think that’s true. I think that’s a really profound point. I’m not sure that I thought about it that way, but I think that you’re right, it I don’t know if level playing field is the right word, but I do think that it probably is a little bit of a superpower for the advisor who could use a little bit more intuitiveness or empathy in that way. I would argue it probably just helps the naturally empathetic, intuitive advisor, just be able to do that faster and at scale, in a great way.

Aaron: One of the things that I always found interesting was advisors who would just take one quick look at our platform and just go Oh, no, like I would want to reduce my clients to a number. I like to provide personalized service to my clients. And I would always look at that and say, you know, the reality is is is what you’re probably doing right now is you’re bucketing them in five buckets, or maybe even three buckets called conservative, moderate or aggressive, okay? And the biggest problem is that we don’t even know if we mean the same thing by these words. So you know, the Risk Number, you know, it might be easy to say, Oh, I don’t want to reduce my clients to a number but the risk number actually enables personalization at scale. It actually enables you to think about who a client is and think about how their portfolio is invested and think about whether or not that’s align and do that, you know, first of all at scale and second of all, with a lot of speed and precision.

Craig: There are aspects in the growth survey that I thought was interesting. The most important lesson was board effective, but the biggest challenge and threat is regulations and compliance and compliance. So the third leg of your stool. They came out with with the Reg BI tool a couple of years back. How big has compliance become in your business plan?

Aaron: It’s become a really important leg of the stool for for this particular reason. If you think about it, this area of engagement with clients is where a lot of the regulation is happening, and where a lot of compliance departments are focused because where advisors get tripped up. I just saw a news article this morning about an advisor in a firm they got fined over half a million dollars for putting the client into a portfolio that was too risky for them. I’ll tell you how to make that not happen. It’s actually not that difficult. It’s called you know, taking a client through a process and engaging them and actually getting them to be bought into how much risk they want to take versus how much risk they are taking and then documenting that they’re that they’re signed off on that.

Aaron: That’s really what we built in the compliance analytics and workflows on the Nitrogen platform is for a firm to be able to go in and say, Well, hey, I can I can kind of see across the entire enterprise that there’s 5000 clients here and I can see which ones have documented this numbers and which don’t, and I can slice and dice and go, which advisors are actually doing this on a consistent basis in which advisors have 80% of their book of business, they have no idea how much risk the client wants and how much risk they actually have. That can drive compliance teams to put their focus in the right spots to drive you know, a much more successful outcome for the firm that doesn’t involve these headline creating fines from regulators.

Craig: It isn’t true that all publicity is good publicity.

Aaron: You’re absolutely correct. In a highly regulated industry, you are absolutely correct.

Craig: I wanted to point out at your last conference, you announced these dashboards, the compliance dashboard I thought was was brilliant was that was the one one of the things that was missing. And we work with a lot of of your enterprise clients that we have this great risk score, risk process 95% probability of being in this range, but there was no way to look across advisors across branches across right. Now with the dashboard, I can see, as you mentioned, here, our clients without a risk score, its clients. I’ve been updated in a while as your clients who are drifting away from that score. So really, really powerful. And it’s those kinds of tools that enterprise clients are dying for. That just really need that type of visibility. What are other things you’re seeing now that you’ve got such a large market share in the enterprise space that enterprise clients are looking for?

Aaron: The next frontier is what we’re rolling out over the course of the next month, month and a half on effectively insights into the into the book of business and into how the book of business is growing and kind of where the clients are from that perspective. So it’s one thing to slice and dice it from a compliance perspective, on risk alignment and and what’s documented. It’s another thing to just sit back and go, Okay, let’s look at how the firm is growing compared to other firms like mine, right in a similar kind of scale as mine. Let’s then slice and dice this by advisor, and let’s look at how my best advisors are growing compared to the average advisor in my firm. Let’s look at how my worst advisors are growing, according to the average advisor, my firm.

Aaron: We’re going to continue to push the envelope on this but the vision that I see is being able to sit down with an advisor and say, Tom, the Listen, you have the ability to frankly be more successful in your own career here as a financial adviser and be more helpful to your clients. It is possible let me show you like here’s an example of how Jill in our same firm has has faster growth, but is getting more out of the prospect meetings that she’s holding is getting more out of the client reviews has more satisfied client has clients that are not as fearful. We’re taking all the checkins data, for example, being able to plot all of your advisors across the grid of how aligned they are versus how happy they are right? And being able to show you these are the activities that your advisors are undertaking to drive these results so that you can help Tom see and persuade Tom with data that he can have the same kind of results and still is experiencing if he will undertake the same kind of activities to drive those outcomes.

Craig: And then before I wrap up, I want to ask you one quick question that we’ve been hearing a lot about, what are your thoughts on AI? How is that coming to the next gen platform anytime soon impacting those management space?

Aaron: Great question. I mean, I was onstage at a conference I think five years ago, and somebody asked me this question. I said, Well, so far, the most effective deployment of AI in our industry has been in press releases. I would definitely say that like, oh my gosh, over the last three, four or five months, I think we’re here I think we’re here where AI is actually starting to drive a bit of a platform shift, and it’s exciting. It’s incredibly exciting. And I see this happening in a few different ways. It’s gonna take some time, it’s going to take some experimentation. It’s not going to be like some overnight switch flip. But this generative AI is going to be an incredibly powerful driver of the human financial advisor. I’m pretty convinced of it. I think it’s going to look a couple of different ways.

Aaron: One is generative AI is getting really good at taking unstructured data and turning it into structured data. And that is one of the things that eats up financial advisor time today in a massive way. So I’m incredibly excited about 100 different applications of how we can help advisors take unstructured data and turn it into structured data.

Aaron: The other thing is what we’ve already deployed Nitrogen AI today helps advisors with that sales enablement content creation. So if I want ka tweet, a blog, post an email, I can say for a client, or a prospect of this generation with this kind of tone and I want to talk about this topic. Nitrogen AI will spit out a draft and you know, basically it spells two things for advisors and solves a percent of their time problem because now they can just edit a draft and it solves 100% of their writer’s block, because now they’re editing instead of trying to write from scratch.

Aaron: It’s going to make content creation faster. It’s going to make engaging with clients faster. It’s going to take the drudgery out of the work. I think five years from now, we’re going to be able to start crediting AI with either driving down minimums or driving up the number of clients that we can serve and the number of clients that can that can engage in the impact of our advice. I think that’s going to be profoundly great for the world. So I’m really excited about this platform shift that I think is coming.

Craig: Aaron, you’ve said it all. Thank you we go. We’re out of time. Where can people find out more about Nitrogen?

Aaron: NitrogenWealth.com

Craig: It’s just that easy nitrogen wealth.com. Thanks so much for being here.

Aaron: Thanks for having me, Craig.

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ABOUT ME

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

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