A handful of financial advisers have contacted me over the past few months, asking if I can recommend a billing application for registered investment advisers.
By the third inquiry, I knew that there was at least a small need for this. I am calling on readers to let me know if there is more need than I see.
As luck would have it, I soon heard about billPort, a product from Arcons Technology Inc.
Billing is a fairly new part of the advisory technology sector, and therefore, it should come as little surprise that there are no established players that make this their core specialty.
In fact, most RIAs use one of two methods for calculating, tracking and forecasting their client billing.
Many still rely on homegrown Microsoft Excel spreadsheets, a terribly time-intensive and error-prone means of carrying out this task.
Other firms have it a little better and make use of the billing features available within their portfolio management or accounting systems.
A lucky few RIAs are on a platform that takes care of billing for them. For example the Advisor Xi platform from Envestnet|Tamarac has a specific billing module that is fully integrated between its PortfolioCenter portfolio management system, re-balancing engine and Microsoft Dynamics-based customer relationship management application.
“We started this project three years ago and over that time have had 15 firms show interest in it,” said Arcons chief executive Hemant More.
The billPort application is built on Microsoft's SQL Server and is but one of almost two dozen applications and tools available from Arcons.
Most of the company's offerings are meant to work with both the long-lived Advent Axys portfolio management application and Schwab's PortfolioCenter product. Both are used by many RIA firms, and the latter is a central component of Schwab's various Intelligent Integration platforms.
In addition to its software development, Arcons provides a variety of tech consulting services, including back-office systems analysis, which is where Mr. More said that the idea for billPort germinated.
The firm's manual billing had become a nearly constant process.
“The lead person at one of the firms we were working with had been unable to take a vacation for several years,” Mr. More said.
The ability to tackle complex and shifting fee schedules is what takes billPort beyond the simple billing features and capabilities built into Advent's portfolio management products or that of PortfolioCenter and other systems.
On the other hand, at firms with a handful of large accounts or that adhere to pretty straightforward billing, those features may be fine.
During the lengthy demonstration that I received of billPort, I got to see many of its strengths, among them its ability to easily search, sort, filter and view accounts on a household basis. (Visit the online version of this story this week to view a slide show of the interface and other features.)
SEARCH QUERY
It is easy to launch a quick search query from the interface to bring up a dashboard at-a-glance view of, for example, a particular family's accounts and billing history.
From the household view, you can drill down to the account level. All the screens have simple sorting, searching and screening.
And thanks to billPort's SQL encoding, it is simple to launch a search across the entire data set or from within a single column.
It is also simple to expand or collapse, and drag and drop, various elements on the screen. In fact, any Microsoft Excel aficionado with no SQL experience should still feel comfortable with the app in short order.
Another strength of the app is the “billing session concept,” basically whereby when creating a bill, all the parameters of it are available on one screen. Click on the “details” button represented by an ellipsis at the far right of the screen, and you bring up additional aspects of the billing process.
I spoke with Debbie Gaffney, controller with the RIA firm First Affirmative Financial Network LLC, following my demo.
She was provided as a user by Arcons, which has five firms using billPort and another eight in the process of evaluating it.
First Affirmative, which has $800 million in assets under management, has been using billPort for a year, and Ms. Gaffney said that she can't imagine her work without it.
Although her own firm's billing burden hadn't quite reached the sans-vacation level, it had grown onerous, she said.
“BillPort has been able to take data in from not only our Axys system but from spreadsheets and order it in such a way that is easy to use, and allows us to come up with an almost infinite number of fee schedules,” Ms. Gaffney said.
“It is almost like a supercharged Excel spreadsheet,” she said, referring to the app's level of intuitiveness.
Ms. Gaffney pointed out many aspects of the program that make life easier, including how deftly client fees or account fee-sharing arrangements can be set up in the system.
“And if we offer special deals for, say, a nonprofit client, it is easy to accommodate that type of fee schedule or even fee-sharing arrangements. The exceptions — those can even become largely automated as part of the [account setup] process,” Ms. Gaffney said.
It is also simple to customize the appearance of a firm's invoices, something not possible with most portfolio management or custodial billing systems.
Pricing includes a one-time setup fee that varies from $10,000 to $15,000, based on a firm's assets under management and number of accounts. This includes five machine licenses in the base price (servers can be either self-hosted or outsourced by the firm).
After that, an annual maintenance fee of 20% of the setup fee is charged.
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