Stubborn software vendors buck integration trend, for now

Some technology providers see potential integration partners as competition, while others respond to adviser demands by partnering with rivals.
SEP 11, 2015
At a time when integration is all the rage for many financial services software providers, some platform vendors have been slow to jump on the bandwagon and plan to stand pat — at least for the time being. Some vendors have continued to go it alone rather than venture out to form a partnership with another service provider primarily because they see the process of integration as potentially time-consuming or having little value in the short term. "Why some might be slower than others [in pursuing integration] is related to them thinking strategically about where they fit," said Neal Quon, co-founder of QuonWarrene, a financial technology consulting firm. There are so many different types of integrations — from something as simple as offering single sign-on from one platform to another, to the more complex, where vendors share data in a bi-directional format that is constantly updated. "That [latter type of] integration becomes more complex, which is why some have been hesitant in the past," Mr. Quon said. GOING ALL IN He does see that changing. Even though some of his clients, which he declined to name, might still be sitting on the fence, taking various factors into consideration while weighing potential integration partners, he sees many in the industry going all in. "The spirit and attitude toward integration is now very open — more so than ever before," Mr. Quon said. RIA in a Box is a perfect example. The company, which provides advisers with software that helps them create registered investment advisory firms and compliance procedures through an online platform, recently participated in its first integration. GJ King, president of RIA in a Box, said the software provider was looking for the right partner. "There are so many amazing technologies today, but also an overwhelming number," Mr. King said. Its first integration partner was Orion Advisor Services, a wealth management technology provider that teams up with various software companies across the industry. Mr. King said with its Orion integration, the company will be able to pull data onto its system. For example, advisory firms can use aggregated data from Orion to determine the states clients are from, since advisers must ensure that they are registered in all states in which their clients reside. "It will be in an automated manner, so we don't have to do that ourselves, which is a real pain point," Mr. King said. MANY CONNECTIONS Orion has many connections with fintech vendors including financial planning platforms MoneyGuidePro and Advizr, data aggregator Quovo and social media analytics platform FMG Suite. Orion's annual Fuse conference last week attracted more than 25 vendors to Park City, Utah, to collaborate on building new adviser-focused technology. The event fostered an additional 17 integrations, including Junxure, a CRM, Riskalyze, a risk management platform, Total Rebalance Expert, a portfolio rebalancing tool and Wealth Access, a data aggregation platform. "We are going to create ways for advisers to share ideas and best practices and communicate with clients in ways they previously have not," said Eric Clarke, chief executive of Orion. FinFolio, a portfolio management platform, pursued an integration when it first started out for that very reason. Its portfolio rebalancing function was lacking so the company decided to integrate with Total Rebalancing Expert. Now that that function has been upgraded, FinFolio considers its integration partner a competitor. WORKING WITH THE COMPETITION Working with the competition may be another reason vendors shy away from integration. In FinFolio's case, there are instances when the company will work with other platforms because advisers want to use their firm's legacy software. Hence it is helpful for advisers if vendors begin working together to make sure users can transition from one platform to another seamlessly. "For the most part, [not wanting to integrate] is probably because they see the others as competition — we certainly see it a bit that way," said Doug Moses, senior vice president of sales of FinFolio. "But people have preferences, especially advisers, so they get used to the technology and they want to stay with it."

Latest News

GLP-1 users are trading retirement savings for their prescriptions
GLP-1 users are trading retirement savings for their prescriptions

A Nationwide survey finds 47% of GLP-1 users have never discussed the drugs’ financial impact with an advisor, even as many dip into savings.

Inspired Healthcare sale price of properties is 59% of $1.2 billion sold by advisors
Inspired Healthcare sale price of properties is 59% of $1.2 billion sold by advisors

The hundreds of millions of dollars from a sale of Inspired Healthcare properties does not mean an immediate windfall for investors.

Class action alleges Webull misled investors about China operations
Class action alleges Webull misled investors about China operations

Its SEC filings said one thing - a congressional probe said another.

Investors accuse Netcapital of inflating revenue through sham deals
Investors accuse Netcapital of inflating revenue through sham deals

Sham agreements allegedly padded revenue by 345%.

Pre-retirees are looking for flexibility, security, and guidance when it comes to retirement income: Cerulli
Pre-retirees are looking for flexibility, security, and guidance when it comes to retirement income: Cerulli

"Most pre-retirees are uncomfortable making key retirement income decisions without an advisor's help," said Chris Bailey of Cerulli.

SPONSORED Built on insurance experience to deliver on long-term promises

Knighthead Life entered the market with a competitive MYGA. A strong launch earned advisor confidence and paved the way for FIAs.

SPONSORED In the Age of AI, Trust Becomes the Advisor's Greatest Asset

As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor