Welcome back to the first Fintech Bytes column of 2023.
We’re all getting back into the swing of things after a couple of weeks off, but the fintech engine is starting to rev back up after a year where fintech struggled more than both finance and technology, according to Wall Street Journal.
How hot it burns remains to be seen. As I wrote earlier this year, many companies are facing an economic outlook that they’ve never faced before. Funding is more difficult to come by than it has been in a decade, and it will be interesting to see how that starts to impact advisor-facing companies.
One adviser-facing company, TradingFront, has already closed down operations in the U.S. to focus more on the Asian market. I have a sense it won’t be the last.
What do you think the year will look like for advisor-facing fintechs? Please let me know with an email or by dropping me a line on Twitter.
Riskalyze has landed its first large client of 2023, bringing on AE Wealth Management, an RIA with $18.3 billion in assets under management and more than 1,000 advisers and staff. AE Wealth will use Riskalyze as its standard platform for acquiring new clients and engaging with them over time.
This year is going to be an interesting year for the larger players in the wealthtech space. Will they continue to land large enterprise clients, or will fears of recession and tightening budgets delay firms’ plans? This January announcement is a big early win for Riskalyze.
Frontier Asset Management’s downside-risk managed ETFs will now include personalized tax management using technology from 55ip. The partnership aims to help advisers tax-efficiently transfer clients into Frontier’s ETFs as well as provide ongoing automated tax-loss harvesting.
While a recession isn’t guaranteed, many people at least feel as if one is coming, and that collective feeling may be more important than raw data. Everyone seems to be preparing for an extended period of difficult markets, and this partnership is another example. Using 55ip’s tech, advisers can move clients into a risk-managed portfolio while minimizing the pinch of embedded capital gains.
Private equity firm Frontier Growth has sold the digital onboarding technology and related wealth management solutions of technology provider Agreement Express. Agreement Express is able to open accounts at multiple custody and clearing firms (it also has a payments business that was acquired by a different tech company), and Advisor360 plans to use it help advisers open investment and insurance accounts across every major custodian.
Beyond multicustodial support, the acquisition will help Advisor360 offer a wider range of integrations with client relationship managers (CRMs). But why buy these capabilities instead of building them in house? We’ll have to see how exactly Advisor360 integrates Agreement Express’s tech.
Savvy Wealth, the digitally native RIA that raised $11 million in venture capital in November, has added another veteran adviser to its ranks. Brad Weber, who managed $150 million in assets at Bank of the West, is turning to Savvy’s platform of proprietary technology to go independent.
Landing the 30-year industry veteran is another win for Savvy, which has also recruited advisers from BNY Mellon, Merrill Lynch and Morgan Stanley. Savvy is proving that providing an integrated suite of technology that advisers can’t get anywhere else is a winning strategy.
Digital alternative investments platform iCapital announced that it's adding more than 100 new people to its technology team. The fintech already employs 400 technologists (the entire company has 1,050 people), but CEO Lawrence Calcano wants to bring on more software engineers, product managers and infrastructure developers to continue pushing iCapital.
While it's not as well known as some consumer-facing brands, iCapital is undoubtedly a fintech success story. The company has raised $729 million, according to Crunchbase, and services $149 billion in assets. After a year when many fintech companies struggled and have had to make layoffs, iCapital brought in additional funding and plans to expand.
In partnership with digital custodian DriveWealth, Richr, a fintech designed to help people save money when buying or selling homes, is launching a wealth management advisory service allowing people to invest the capital proceeds from selling their home directly into stocks, bonds and other investment products. The idea is to provide alternatives to people who aren't ready to purchase their next home.
As a 35-year-old millennial living in New York City, the whole concept of owning a home is a bit foreign to me, let alone buying, selling, escrow, and all that other stuff. Still, this seems like an interesting, unique idea for a fintech company.
Zocks has inked an exclusive partnership with mega-RIA Hightower, while Jump becomes the choice AI operating system for Equitable Advisors' field force.
The agency's proposal to rescind the contentious 2024 Biden-era mandate opens up a 60-day public comment period.
The Carmel, Indiana RIA grew nearly 150% in assets since severing ties with its first backer following a FINRA dispute.
Meanwhile, Raymond James' employee arm adds a defector from D.A. Davidson, and South Carolina-based RIA Ballast Rock Private Wealth recruits a new advisor.
A FINRA arbitration panel sided with a former wealth manager fired over a $642 deli platter and a disputed client event.
As $84 trillion prepares to change hands, advisors who treat estate planning as peripheral are quietly building a sieve, not a book.
In volatile markets, the advisors who win aren't the ones with the best calls - they're the ones whose clients stay the course.
