The adviser world returned from the July 4 holiday ready to spend some money on technology.
First Trust became the latest asset management firm to buy a direct indexing fintech with its acquisition of Veriti. It’s going to be interesting to see how these firms differentiate their offering and convince advisers that their direct indexing product is superior to the dozen others on the market.
And as XY Planning Network co-founder Michael Kitces put it on Twitter, the trend demonstrates how difficult it is to disrupt the asset management business. Truly innovative technology is more likely to get acquired before it can seriously displace the incumbents.
The other major deal of the week was Envestnet’s purchase of fee and billing fintech Redi2. The deal expand Envestnet’s ability to serve asset management firms, and I broke down why advisers are increasingly turning to automated billing fintech. It’s also interesting to see Envestnet — which has had a turbulent 2022 with rumors swirling about a sale, some office closures and the relocation of its headquarters, a departing president and a corporate restructuring — opening up the wallet for a fintech company.
Learn what is fintech here.
Read on for the rest of the week’s fintech headlines.
Independent advisers using SEI for technology and investment management will soon have access to Holistiplan, a tax planning software that automates the process of reviewing a client’s tax returns. With clients expecting advisers to provide more financial services, tech like Holistiplan can help advisers add tax planning to their repertoire.
The partnership with SEI, which has 7,500 advisers on its network, has the potential to be a big win for the rapidly growing Holistiplan. The firm claims it has added 10,000 users since launching in 2019 and already has a significant market share lead over its competitors, according to the 2022 T3 Inside Information adviser technology survey.
Independent Advisor Alliance, a hybrid RIA, is partnering with a Cornelius, North Carolina-based computer repair service called We Handle Tech to launch a new technology firm dedicated to supporting financial advisers. The aptly named We Handle Tech: 4 Advisors will provide IT solutions and software, help mitigate cybersecurity risks and ensure firms are compliant with regulators.
It’s not just a clever name, what’s interesting about this initiative is the idea of helping advisers with both hardware and software needs, as well as setup and training. Services like this could also help deal with the integration problem facing many advisers.
Federal prosecutors say the scheme used fake investment accounts and a fictitious financial advisor to lure victims into romance-fueled fraud.
Morgan Stanley sought to claw back recruiting bonus money from Darryl Cohen.
Referrals from centers of influence may open the door, but the real key to success for advisors comes from clarity about their ideal clients and where they want to show up.
Three advisor groups overseeing more than $700M in combined client assets head to new firms.
New research finds most Americans fear a US retirement crisis, while skepticism grows toward AI financial advice and crypto in retirement plans.
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
