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A few more voices weigh in on Black Diamond

I interviewed a lot of folks for my column last week on Advent Software…

I interviewed a lot of folks for my column last week on Advent Software Inc.’s acquisition of Black Diamond Performance Reporting, more than I could get into the column itself. So I wanted to get the remaining opinions I collected into the mix.
As luck would have it Rick Adkins, an adviser and chief executive of The Arkansas Financial Group Inc. said his firm was currently in the middle of transitioning from Principia CAMS to Black Diamond.
Not surprisingly, he said his firm had received no warning that the acquisition was coming.
“We are somewhere between 60% and 75% percent there,” he said of the migration between databases.
“There are a lot of transactions, 25 years worth and that is a lot of data and the challenge is getting the data out in small enough bites to then put it in in the way we need it,” he said.
He added that the challenge was no reflection on Black Diamond. In fact a major part of his firm’s move to Black Diamond was a need to be able to scale quickly to help with growth.
One unexpected challenge his firm had confronted with Black Diamond though was that 403C accounts were not currently feeding into the system.
“While we have done a workaround on some clients coming in through ByAllAccounts, so we can’t really use the reporting until that gets fixed — they [Black Diamond] seem to be geared more toward RIAs that are more investment driven than financial planning-driven,” Mr. Adkins said.
“When it comes to the acquisition, I would presume that it will mean there would be more resources available for development at Black Diamond, especially since I never viewed Advent as that focused on RIAs in the first place, much more devoted to asset management and money management that I can tell, so hopefully there is enough coalescence around their platforms to have the critical mass necessary to pull this off,” he said.
Among the other folks I spoke with was Rich Gill, vice president of Focus Financial Partners LLC.
He by and large shared Mr. Adkin’s opinion.
Focus is a partnership of 20 independent advisory firms that manage $40 billion in assets. Some refer to them as a roll-up or consolidator of firms.
Regardless of how they are viewed Rich is a good sounding board because of where he sits. His vantage allows him to see the tools and technology being used by 20 firms and among those firms four are currently using Advent he said.
“One of our firms that is using Advent has been looking at this for a while [a switch to Black Diamond], which, in my opinion has its own strengths and weaknesses and it will be interesting to see how things play out,” Mr. Gill said.
Lacking his own in-depth experience with Black Diamond he said that he sees it as much more of a technology company and not a services company.
“They are known for having a terrific user interface with pretty charts and graphs and a strong client portal feature — that is all good,” he said, adding, “But service at times could be a challenge, after all it is a small tech startup without legions of people.”
“This is a good sign in that Advent is investing in the RIA business. What we want to see is them investing in Black Diamond because it has some really talented people — are those people sticking around? Are they going to continue to develop it? These are the questions we want to see answered before we make decisions.”
Peter Giza, chief of technology and business development with RedBlack Software LLC said that the deal looked like a win for the industry overall. He wrote me an e-mail that summed things up nicely.
“It makes sense in several ways: Black Diamond has been making significant inroads into Advent’s territory; Black Diamond has a great look and feel, everyone who sees it goes “wow”; Black Diamond is single-minded, focused on reporting and delivery via the cloud, whereas this has not been Advent’s focus; And I believe that where there is overlap there is opportunity for Advent to leverage their new tool. I think this will put a lot of pressure on other portfolio management platforms. My bet is that it will perk up the acquisition minded as well,” he wrote.