Robo-adviser takes a stake in Plancorp

Traditional advisory firm to become the human element of hybrid-robo offering

May 25, 2017 @ 1:11 pm

By Liz Skinner

Financial advice firm Plancorp has attracted a novel investor. The 34-year-old advisory firm is now partially owned by a fintech firm launching a digital advice platform later this year.

The St. Louis, Mo.-based registered investment advisory firm, which has $3.6 billion in client assets, will become the live adviser component for the hybrid robo to be known as BrightPlan.

(More: Robo-advisers and human advisers adopt each others' biggest advantages)

Prumentum Group, the fintech firm that owns BrightPlan, acquired a 40% stake in Plancorp and has the option to buy as much as 100% of the company in the future, according to Chris Kerckhoff, Plancorp's president. Financial details of the deal were not released.

"This supports our efforts to serve the next generation of our existing clients and will evolve our relationship with all clients by offering mobile and digital enhancements," he said.

Existing Plancorp clients, mostly ultra-high net worth and high net worth families and individuals, will gain account aggregation tools and other goal-tracking capabilities that the BrightPlan platform will offer.

(More: Meeting clients' high-tech expectations)

Plancorp spent many years looking for an innovative digital strategy for clients that went beyond focusing on investments, Mr. Kerckhoff said.

BrightPlan will evaluate a user's full financial picture to create a custom set of financial objectives, and incorporates a digital and interactive planning tool, he said. Its clients will be urged to consider talking with an adviser once their overall financial situation suggests certain complexities, such as needs that extend to estate planning, tax or other professional help.

Plancorp, which has 55 employees, has a $5,000 annual fee minimum for clients. It was one of the nation's first fee-only advisory firms when it was founded in 1983 by Jeff Buckner, who is still one of the firm's 14 employee shareholders that control the other 60% of Plancorp.

Mr. Kerckhoff, a 20-year veteran of Plancorp, said he wouldn't be shocked to see other advice firms strike such deals with wealth technology firms.

"I think over time we'll likely see a closer relationship between advisory firms and tech firms," he said. "If you look at the need to scale, it really made sense to build such a partnership."

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