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New hybrid platform being rolled out by Private Client Resources

Some advisers may not know Private Client Resources but with their new offering it is likely more registered…

Some advisers may not know Private Client Resources but with their new offering it is likely more registered investment advisory firms will take notice.
Their new Hybrid Solution is an expanded version of the company’s Palette Platform, which PCR describes as geared for RIAs that are interested in “partially outsourced service solutions.”
It combines account and wealth aggregation with portfolio reporting and other tools and has been in development for a year.
The hybrid solution gives advisers control over their manual data entry while at the same time providing access to institutional-level aggregated electronic feeds and custom reporting.
“Many [RIA firms] that we go after are still using software, spreadsheets and people to do their aggregation and they always ask if we have a software solution for this and we say ‘no we are a services company,’ we are an outsourcer of this,” explained PCR president and chief executive Robert Fiore in an interview.
He explained that the hybrid offering is not meant for a particular AUM level, whether firms under $1 billion or over $1 billion; rather it targets groups not quite ready for a totally outsourced solution no matter their size.
“This allows the prospect to get our full platform served to them, web-based software as a service and they get to enter their own alternative investments into it,” he said.
He went on to explain that PCR provides the full technology platform in the hybrid offering — except for the alternative investment reconciliation and record keeping.
“We are providing you all the tools to investigate the data and those tools are fully integrated into the reporting systems, which is key and not the case with all outsourced providers,” said Mr. Fiore.
To date PCR has been providing account and ‘wealth’ aggregation services to private banks, family offices and registered investment advisory firms but the latter has tended to serve higher net worth clients.
Their full, proprietary Palette Platform on the other hand, provides aggregated and reconciled data, including expertise with alternative investments, and reporting with full multi-currency support.
It also has interactive online dashboards, rebalancing, research, risk analytics, CRM integration and invoicing to boot.

A bit of general background

Many larger registered investment advisory firms crunch their own numbers and end up biting the bullet to purchase fully outsourced, fully-hosted offsite technology (firms that use Tamarac’s Advisor Xi platform are prime examples of this trend), many mid-size and small firms balk at the cost and end up continuing to self-host.
Larger firms, which tend to have either a dedicated IT professional on staff or an adviser that oversees this as operations director — and thereby pretty much becomes a non-producing adviser — come to the realization that they are better off in off-loading their technology.
Smaller firms tend to think of many outsourced services as too expensive for now, though many would probably reap the benefits of increased efficiency and make their money back in a year or two.
So it is that PCR has come up with its hybrid offering in an attempt to entice firms into using a partially outsourced solution.
Mr. Fiore said that while it has no one using the hybrid system in production it is in the middle of landing its first client for the platform. He adds that without that offering, PCR would likely have lost the deal all together.
“They are already billing and reconciling their own data themselves and were thinking they would probably want to offload all of it in our fully outsourced offering,” he said, but that proved wrong, they already had the manpower and were paying for it.
“They were putting in the effort themselves and could just do it more effectively with the new tools we were providing in the hybrid solution that they had previously not had access to and still save money,” he added.
“With the hybrid they were still going to save about $100,000 and the amount of effort they would have to go to would still make sense for them,” said. Mr. Fiore.

Here is a bit more on it in their own words (shortened a bit here an there):

In my interview with him Mr. Fiore referred to Envestnet Inc. and Advent Software Inc. as two dominant players he and his team often encounter in the market and view as chief competition.
Mr. Fiore gets Kudos in my book for at least providing us with a range in terms of pricing.
“Essentially you can buy the hybrid for the same price you are currently paying today for [your current] software, people and cost,” he said.
“Our clients tend to spend anywhere between $50,000 and $150,000 a year, it really depends on the size of the firm and AUM,” said Mr. Fiore.
While pricing was not yet finalized and there are no clients currently using it, he said that the new Hybrid product would be a fraction of the cost of the fully outsourced solution.

For more information visit PCR online.
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