Envestnet Yodlee raises the bar with AI-powered apps

The company sets a new standard not only in technical prowess, but in understanding how people want to use technology.

Any doubts as to who is leading the way on adviser technology should be put to rest after last week’s Envestnet Advisor Summit.

In addition to announcing updates to Tamarac and a plan to launch an annuities marketplace, Envestnet gave a first look at the new artificial intelligence tools it’s building with Yodlee’s data and technology.

They are miles ahead of anything else on the market.

(More: Envestnet is the industry’s 800-pound tech gorilla)

Envestnet Yodlee Chief Executive Anil Arora demonstrated three applications during his keynote. The first, Envision IQ, plugs into a firm’s data and provides an easy-to-use interface to which advisers can pose any questions they may have about their business or their clients.

Using either a desktop or mobile device, advisers can key in queries like “Who are my top clients?” or “What are my new money flows?” or “Did any clients add cash last week?” and receive an answer within seconds. If advisers have a device powered by Amazon’s Alexa, they can simply speak their question and the digital assistant will report back.

The number of possible questions is in the millions, according to Yodlee executive managing director Frank Coates, and the only real limitation is on the data the firm provides Yodlee. For example, if an advisory firm provides information from a CRM, Envision IQ can handle questions on client interactions and behavior. If Envision IQ is connected to a marketing software, it can give insights on the effectiveness of outreach efforts.

“I don’t think major companies have gotten a huge return on their investment on data and analytics,” Mr. Coates told InvestmentNews. By contextualizing the data into everyday questions, Envision IQ gives advisers analytics that they can act on. “It’s making better decisions, faster, and doing it more frequently.”

Envision IQ demonstrates not just Yodlee’s technical prowess, but an understanding of how real people want to use and interact with technology. For most people, the data firehose is just noise. But to ask a specific question about a client and get an immediate answer? That’s powerful.

This understanding is even more evident in the two client-facing “financial wellness” apps Mr. Arora demonstrated.

In his presentation, Mr. Arora gave insight into the needs of millennial investors that went well beyond traditional platitudes about “being tech savvy and love sharing on social media.”

“They are balancing day-to-day issues with long-term investments,” he said, acknowledging the effect that rising student loan debt and shrinking employer retirement plans are having on investing behavior. “The No. 1 request from millennials and Gen X is to know how much cash they have. ‘Am I going to run out in 30 days?’”

The first tool, OK to Spend, pulls a user’s entire financial picture, including credit cards, bank accounts, loans and monthly bills, into a single location. It then uses AI to identify spending habits and project how much the user can comfortably spend until the next payday.

The other app, AI FinCheck, provides a more holistic assessment to help young investors with their long-term financial health. The app uses peer benchmarking to show how similar people spend and to recommend changes.

For example, it can identify whether someone is spending too much of his or her paycheck on rent, especially compared with other people in the neighborhood. If the investor doesn’t want to consider moving, AI FinCheck can scan the monthly bills and suggest ways to save, such as giving up cable TV in favor of streaming.

In just a few clicks, users can use AI FinCheck to set up an emergency savings fund or even designate how much of their paycheck to save.

“There’s a whole segment of the population you can deepen relationships with,” Mr. Arora said.

He’s right. As a 30-year-old millennial, OK to Spend and AI FinCheck are the apps that comee closest to matching how my peers and I approach our finances. After the demonstration, I immediately wondered how I could get my hand on these apps.

Envestnet was quiet about where these tools would debut, but Mr. Arora made a point of showing that Yodlee counts among its clients 13 of the world’s top 20 banks, and all 10 of the top wealth management firms.

It’s likely that we’ll see these firms launch versions of Yodlee’s apps over the coming months. Whoever does so will immediately be head-and-shoulders above the rest of the industry when it comes to technology.