What a huge news week. Even in the realm of wealth technology, there was a lot going on.
Of course, the biggest news of the week were political stories where headlines related to elections both in the U.S. and abroad shook many of us and led to calls to tone down the political rhetoric.
Wealthtech news is always hot, but is still a nice place to cool down compared to all of the overheated summer politics in an election year. We welcome you to read all of our technology and AI coverage as a respite from the high-stakes and high-stress political coverage. While politics can literally touch everything everyone does, this will remain a poltics-free zone to the greatest extent possible.
The week, the big news wasn’t such a surprise—Envestnet is going private, an announcement that we all knew was coming. The TAMP and wealthtech giant will become part of Bain Capital’s portfolio of companies, with major financial services firms getting in on the transaction with investments of their own.
Aside from the Envestnet news, we also wanted to highlight a recent survey from reseracher Medius that found that 60% of financial professionals are looking for a new job outside of the sector.
The big reason? Employees within the financial sector are saying their professions are not keeping pace with changing times and expectations. As a result, three-fifths of Medius’s respondents said they wouldn’t recommend a job in finance to the younger generation, as other fields offer better compensation, a better work-life balance, and more stability and security.
Digging deeper, Medius found that administrative responsibilities and repetitive tasks are two major issues driving people out of the industry—which happen to be two of the most common problems that the current generation of wealth tech providers are solving for.
That leaves me wondering, can technology solve these issues quickly enough to help stem the attrition from the financial services industry and bring more workers in—or, as we’ve pondered in previous columns, does advancing technology obviate the need for so many financial services employees and accelerate the attrition?
Let’s get to some headlines.
Advyzon
Advyzon Investment Management (AIM), a turnkey asset management program (TAMP) under the umbrella of comprehensive technology platform Advyzon, recently announced a partnership with FINIAT, a leading provider of wealth management software that enables financial advisors to provide turnkey trading for their client’s portfolios.
The partnership takes FINIAT’s powerful solutions to the next level by integrating them with Advyzon’s trading and portfolio management capabilities. This seamless integration enables financial advisors to automate and personalize portfolio management for each client, leveraging FINIAT’s Intelligent Allocation Portfolio Management Platform and iindex Intelligent Indexing solutions; access a comprehensive, end-to-end portfolio management solution that streamlines investment strategies and enhances client outcomes; and scale their business with confidence, backed by Advyzon’s robust and scalable architecture.
With Advyzon’s innovative technology, FINIAT’s solutions will be automated, allowing advisors to effortlessly maintain optimal portfolios – with dynamic adjustments to reflect changing market conditions and client goals. Advisors can prioritize high-value activities such as client relationships and business development while the platform handles the intricacies of portfolio management.
Canoe Intelligence
Canoe Intelligence (“Canoe”) announced the completion of its Series C financing round of $36 million, led by Growth Equity at Goldman Sachs Alternatives (“Goldman Sachs”) with participation from existing investors F-Prime Capital and Eight Roads. This latest round marks a significant milestone for Canoe, representing a more than 3x increase in company valuation since its Series B financing in 2023. With the additional capital, Canoe will continue its investment in building proprietary AI and machine learning technology to enhance its comprehensive back-to-front office capabilities.
Alternative investments now represent $22 trillion in assets under management, or 15% of global assets under management, highlighting the critical importance of advanced technology for managing investment documents and data. Through its automated infrastructure, Canoe drives improvements in data accuracy and access, team efficiency, and client satisfaction for investors. Canoe’s platform streamlines data management for a diverse client base of 325 institutional investors, capital allocators, wealth managers, family offices and asset servicing firms, including Blackstone and Hamilton Lane (Nasdaq: HLNE).
Since the completion of Canoe’s Series B funding round in February 2023 led by F-Prime Capital and joined by Eight Roads, Canoe has achieved 100% year-over-year growth in both clients and revenue. Canoe’s extensive partnerships with four of the top five global asset servicing firms, seven of the top ten global investment consultants, six of top ten fund of funds, five of the top ten endowments, 12 of the top 25 largest independent wealth managers, and many of the world’s largest single-family offices provide the firm with unique scale and market leadership. Canoe supports the alternative data management needs of over 1,000 LPs across more than 650,000 commitments and subscriptions to over 42,000 funds. This represents one of the most robust fund master databases in the world.
The Digital Data Design Institute at Harvard
The Digital Data Design Institute at Harvard (D^3) today announced the launch of its Advisory Council and Industry Council to further its focus on using AI and digital technologies to advance business and society. The Advisory Council, made up of industry visionaries, will work with D^3 and Harvard Business School leadership to build and scale the structures needed to drive the future of global business with AI. In addition, the Industry Council, composed of senior leaders across industries working with AI and digital technologies, will collaborate with Harvard and Harvard Business School faculty at D^3 to identify the greatest potential impact of the Institute’s research.
Advisory Council members bring diverse expertise and global perspectives, invaluable to the mission of driving the future of business. Each Council member serves a term of four years to drive longer-term impact for the Institute.
Industry Council members, who will serve one-year terms, will offer faculty and their researchers at the Institute insights on high impact research opportunities across sectors and geographies. The Industry Council will provide guidance on the potential business impact of the research coming out of D^3. Industry Council members will review proposed field experiments, offering strategic advice on their relevance, reach, and impact, to foster rapid and impactful research outcomes.
Earned Wealth
Earned Wealth, a tech-enabled financial services firm focused exclusively on the needs of medical professionals, announced a $200 million capital commitment led by growth equity Investors Summit Partners and Silversmith Capital Partners with participation from existing investors Juxtapose, Hudson Structured Capital Management, and Breyer Capital. The capital will support expansion of the company’s platform and offerings through product innovation and strategic acquisitions. In conjunction with the investment, Earned announced the acquisition of Thomas Doll, a leading provider of financial services to medical professionals and practices. Today, Earned serves more than 3,000 clients, with over $2 billion in assets under management.
Earned’s mission is to redefine financial services for healthcare professionals through creating the first tech-enabled, integrated personal financial management platform offering wealth, tax, career advisory, insurance, and other services designed for the complex needs of doctors. Using a medical professional’s career journey as a lens, Earned combines deep prognostic technology with a comprehensive set of financial services provided by fiduciary advisors who deeply understand the unique challenges doctors face. With an exclusive focus on medical professionals, Earned advisors are well equipped to guide decisions ranging from medical school loan repayment schedules and private practice buy-ins to medical group malpractice insurance coverage and optimal tax strategies during a practice sale. Earned’s evidence-based approach can proactively and continuously help optimize financial decision-making across nearly every aspect of their clients’ financial lives.
The Thomas Doll acquisition will help accelerate the combined company’s growth and expand the breadth of financial services offerings. Thomas Doll clients will benefit from Earned’s comprehensive wealth management approach, trusted fiduciary advisors, and proprietary tech platform.
Envestnet
Envestnet announced that it has entered into a definitive agreement to be acquired by Bain Capital in a transaction valuing the Company at $4.5 billion ($63.15 per share). Reverence Capital also agreed to participate in the transaction. Strategic partners BlackRock, Fidelity Investments, Franklin Templeton, and State Street Global Advisors have committed to invest in the proposed transaction, and upon its completion they will hold minority positions in the private company.
Envestnet manages over $6 trillion in assets, oversees nearly 20 million accounts, and enables more than 109,000 financial advisors to better meet client financial goals with one of the most comprehensive, integrated platforms delivered at scale in a unified, engaging digital experience. The Company has had great success enhancing the advisor and investor experience, and currently supports over 800 asset managers on its Wealth Management Platform. Envestnet was recently recognized by the 2024 T3/Inside Information Advisor Software Survey as a leader in Financial Planning, Portfolio Management, TAMP and Billing Solutions — reinforcing the strength, depth and breadth of its industry-leading Wealth Management Platform and commitment to supporting advisor growth and productivity through its deeply connected ecosystem.
Under the terms of the agreement, which has been unanimously approved by the Envestnet Board of Directors, Envestnet shareholders will receive $63.15 in cash for each share of common stock they own. The transaction is expected to close in the fourth quarter of 2024, subject to the satisfaction of customary closing conditions, including receipt of approval by Envestnet’s shareholders and required regulatory approvals. Upon completion of the transaction, Envestnet’s common stock will no longer be publicly listed, and Envestnet will become a privately held company.
iCapital
Advisors Asset Management (AAM) and iCapital announced that Crescent Private Credit Income Corp. (CPCI), a non-exchange traded, perpetual-life business development company (BDC) launched by Crescent Capital Group LP (Crescent), will be made available on iCapital Marketplace.
Through this collaboration, iCapital will provide AAM with access to its global network of wealth managers and advisors on the platform, as well as the option to benefit from due diligence services supported by iCapital.
CPCI is designed to generate current income with meaningful downside protection by providing access to a diversified private credit portfolio consisting primarily of sponsor-backed, directly originated assets, including debt securities and related equity investments, made to, or issued by U.S. middle-market companies.
Nitrogen
Nitrogen (formerly Riskalyze) announced the availability of an integrated client engagement platform featuring three products from the wealthtech innovator: Nitrogen Risk Center, Nitrogen Planning Center, and Nitrogen Research Center. The products are available to solo advisors a la carte as annual subscription Plans for Advisors or, as Team Solutions, with accounts-based pricing for growing RIAs. Nitrogen also announced the availability of the Riskalyze plan, the industry-standard risk tolerance and proposal generation tool for financial advisors at $99/month.
All Team Solution deployments of Nitrogen are powered by Command Center, providing the firmwide data, controls, and oversight you need to get the most out of your Nitrogen products. From monitoring AUM-wide best-interest alignment across each and every holding, account, household, and proposal to controls that manage risk parameters and brand application, to all-new ways to create and manage custom strategies for deployment across advisors, Command Center puts firm leaders in control of their technology. Available immediately, the expanded Nitrogen client engagement platform can be accessed in one of two ways: by individual advisors purchasing a Plan for Advisors or by home offices and enterprises who choose a Team Solution.
Nitrogen Plans for Advisors offer a la carte access to the Nitrogen platform, with the Riskalyze plan starting at $99/month ranging up to Nitrogen Complete. Nitrogen Complete offers solo advisors a risk tolerance, planning, and investment research toolset and adds premium customer support as well as Nitrogen Marketing Center. Marketing Center empowers advisors to supercharge their client outreach and acquisition efforts with a database of high-quality, customizable marketing materials. With a simple, one-time upload of a firm’s logo, disclaimers, and brand colors, an advisor’s unique branding will be seamlessly integrated across dozens of assets, with no need for specialized graphic design or copywriting skills.
Smartria
Smartria, a provider of regulatory compliance software, and MirrorWeb announced that they have combined forces to deliver an integrated compliance solution for registered investment advisors (RIAs). The solution allows customers of both companies to connect their accounts and seamlessly manage their compliance programs, including regulatory filings, marketing reviews, and communications supervision, including but not limited to email, websites, social media and mobile communications.
Smartria partners with many of the leading RIA compliance consultants and a wide variety of wealth tech companies, including but not limited to CRMs, wealth management solutions, risk management platforms, and financial data providers. MirrorWeb–which offers the full range of supervision services for websites, social media, mobile messaging platforms, email, and more–is Smartria’s only current archiving and supervision partner.
The Smartria-MirrorWeb integration is available immediately.
SMArtX Advisory Solutions
SMArtX Advisory Solutions (“SMArtX”) announced the launch of its SMArtX Transition Analysis Tool. This innovative solution empowers financial advisors to seamlessly migrate client accounts to new investment models while controlling tax impact, setting a new benchmark in portfolio transition efficiency.
The SMArtX Transition Analysis Tool is engineered to streamline the intricate and often time-consuming process of transitioning portfolios to new investments. By harnessing powerful automation and customization capabilities, the tool eliminates manual calculations and simplifies complex processes, enabling advisors to focus on delivering superior client service and strategic business growth.
Created to reduce advisors’ workloads, enhance client engagement, and improve client satisfaction, the new SMArtX Transition Analysis Tool transforms traditionally burdensome processes that have historically prevented advisors from achieving optimal efficiency and investment excellence.
SMArtX Advisory Solutions
SMArtX Advisory Solutions also announced the addition of 21 new strategies from eight leading asset management firms to its rapidly expanding platform. With this expansion, SMArtX’s cutting-edge platform now offers 1,484 strategies from over 300 distinguished asset management firms.
Newcomers Moody Aldrich Partners and Vineyard Global Advisors bring their US equity and hedged equity strategies, respectively. Meanwhile, existing partners Allspring Global Investments, Dana Investment Advisors, Lord, Abbett & Co., Nuveen Asset Management, Ocean Park Asset Management, and SMArtX Advisory Solutions have introduced new strategies focusing on themes including fixed income, equity, and allocation.
