AdvicePay beefs up compensation tech capabilities with AdvisorBOB acquisition

AdvicePay, the leading wealth tech provider with a focus on advisor billing and payments, is extending its reach into the fee-based advisory market through a landmark acquisition.

The fintech provider announced Monday that it has acquired AdvisorBOB, a fintech company specializing in advisor compensation software, as part of a strategic effort to expand its reach across the full revenue lifecycle of advisory firms.

The transaction, which marks AdvicePay’s first acquisition, brings together two advisor-founded platforms that aim to streamline key operational processes for RIAs. AdvisorBOB’s system automates compensation calculations and payout tracking, reducing reliance on spreadsheets and helping ensure accuracy in advisor payments.

The addition of AdvisorBOB expands AdvicePay’s capabilities beyond client billing, allowing firms to better manage advisor payouts as part of the complete revenue lifecycle.

“AdvicePay was created to solve the pain points around billing and compliance for fee-for-service financial planning. Expanding into compensation is a natural extension of that mission,” Alan Moore, co-founder and chief executive officer of AdvicePay, said on Monday.

According to the latest research report from Cerulli, more than half of financial advisors expect advisory fees to represent at least 90 percent of their revenue by 2026. That forecast is driven at least in part by the ongoing shift away from transactional models toward more fee-based planning. Within its own platform, AdvicePay has reported a rise in monthly recurring subscriptions for planning fees in 2023, as well as quarterly subscriptions and one-time payments for financial planning services.

Against that backdrop, AdvicePay has established itself as the dominant player in the advisor billing space. In the latest T3/Inside Information Advisor Tech survey, it emerged as the runaway leader among customized billing and payment tools for advisors, capturing roughly 13 percent of the market. That put it more than 10 percentage points ahead of the next-largest contender in the category.

AdvisorBOB got an honorable mention in the report, securing the last spot among T3's top-ranked billing and payment tech firms. It was also named among a handful of alternative billing software platforms being considered by survey respondents.

The AdvisorBob deal was completed without external funding, which AdvicePay said underscored its profitability and measured approach to growth.

“Our origin story is very similar to that of AdvicePay, as we are both advisor-founded technology companies built because there weren’t products that fit our needs,” said James Spinelli, founder of AdvisorBOB and chief executive officer of Great Valley Advisor Group.

AdvisorBOB’s team, including chief executive officer Colton Pence, will join AdvicePay and continue operating from its Berwyn, Pennsylvania office.

AdvicePay plans to maintain AdvisorBOB as a standalone product for the time being, with both companies continuing to serve clients independently. However, it left the door open to a possible integration of capabilities as demand grows for connected solutions across billing and payout processes.