Commonwealth Financial Network is bringing next-generation financial planning technology to its network of advisers through a new partnership with RightCapital.
RightCapital is integrating its technology with Commonwealth's Client360 system to provide a seamless flow of data, letting advisers use RightCapital's interactive features without having to manually move over brokerage information.
For Commonwealth brokers not yet offering financial planning, RightCapital will also connect its engine directly into Client360 so Commonwealth can design a "light" version of financial planning with the user experience and workflows advisers are already accustomed to. If they want to use some of RightCapital's advanced features, such as
planning for student loan repayment or Medicare, they can transition over to the full version.
"For the past decade, Commonwealth has integrated goal tracking right into Client360°, straddling the line between basic calculators and comprehensive financial planning software," Darren Tedesco, managing principal of innovation and strategy at Commonwealth, said in a statement. "Our partnership with RightCapital will allow us to contract out the planning engine while maintain our unified interface, which will allow the simpler output from Client360° to be aligned with the more comprehensive output of RightCapital."
The news comes as the 54-year-old hybrid adviser is looking to adjust its business model for a changing advisory industry.
Commonwealth CEO Wayne Bloom recently said that the broker-dealer is seeing
a rapid escalation in brokers abandoning commissions in favor of charging annual fees. The firm is also preparing to
launch a parallel business for RIAs.
A partnership with RightCapital could help transitioning brokers better justify the fees they charge clients, help attract breakaways, or entice advisers to consider Commonwealth for new accounts instead of other custodians.
Commonwealth could not be reached for comment.
The partnership is a win for RightCapital, which has found traction in the independent adviser market but hasn't landed the same enterprise partnerships as more established fintechs like eMoney Adviser, MoneyGuidePro or NaviPlan.
RightCapital announced an expanded
relationship with Betterment for Advisors in September, but a partnership with Commonwealth, which supports 1,800 advisers, is the company's biggest deal to date.
Other large financial institutions want to see a proven track record of success before they bring a technology on board, which can be a challenge for a company just three years old, said RightCapital founder and CEO Shuang Chen.
"This partnership will put us on the map in the enterprise space," Mr. Chen said.
He attributes his startup's success to its unique approach to designing adviser fintech. While a lot of solutions out there are produced by former advisers, RightCapital's background is firmly in technology and not financial services.
"We think we've brought a fresh set of eyes to tackle the problems," Mr. Shuang said. "We work closely with financial advisers, but we've never been financial advisers ourselves. We're looking at the question from a different angle."
