Digital natives expect to be served with technology and usually like technology to be part of every touch-point they have with a business or service provider—but that doesn’t mean they understand the technology itself better than older generations.
In this week’s edition of Advisor Tech Talk, we have plenty of headlines to get to, but we also want to talk about how serving next generation clients with technology requires embracing a paradox.
This week, we received more useful confirmation that the generational shift to financial technology versus traditional human financial services continues, with 60% of millenniial and Gen Z small business financial decision-makers reporting that they are using AI within their businesses, versus 34% among baby boomers and Gen X, according to a just-released, 1,100-respondent survey sponsored by American Express.
American Express also found differences between generations in how AI was being adopted within business, with younger businesses automating more processes while older generations were more likely to use AI for security and workforce management.
These younger generations are using more technology and are expecting to encounter more technology as their first service touchpoint–not just at work but also in their creative and transactional relationships—however, that doesn’t mean they’re technologically literate, according to eye-opening analysis from Simon Yeoman, CEO of internet service provider Fasthosts, published this week by Techradar.
Yeoman wrote this week of a growing divide between the technological skills of digital natives and the needs of employers. Just because someone grows in a world surrounded by technology doesn’t mean they understand the best ways to use technology. In an example given by Yeoman, the average millennial or Gen Z internet user likely uses Google every day, but usually does not understand how to find the best responses from a Google search.
Similarly, we’re surrounding Gen Z and millennials with financial technology that often goes well beyond what a traditional financial advisor can offer them—but that doesn’t mean the average technology user, even a young one, can successfully use this technology to produce optimized financial results over a long period of time.
Yeoman’s point has been illustrated previously, however, he goes on to argue that there are two catalysts exacerbating technological illiteracy among digital natives. One is a preference for more frivolous uses of technology like consumption, gaming and social media. The other is the ease of use of emerging technologies—what once took writing code on punch cards or at a command prompt on a computer terminal connected to a local mainframe is now accomplished by pressing a finger to a smartphone connected to a global internet. For writers like Yeoman, it’s like young people don’t even need to know about computers anymore.
Can wealthtech and fintech do the same thing for personal finance and wealth management?
Let’s get to some headlines.
Advyzon
Advyzon, a comprehensive service and technology platform and portfolio management solution for financial advisors and investment managers, recently announced that Samantha Schwimmer has joined the team as Chief Marketing Officer. With nearly 15 years of experience in the financial services industry, Schwimmer brings her marketing expertise to the award-winning all-in-one wealthtech platform.
Schwimmer has been tasked with helping Advyzon enhance its market presence, better demonstrate its value, and move into new market segments – namely on the enterprise, institutional, and investment management sides of the business – in addition to providing continued support to Advyzon’s exceptional core technology solutions. She will oversee all marketing related activities, bringing her extensive marketing experience and insights to the growing company, which has been named to the Inc. 5000 list of America’s fastest-growing private companies for the past three years. As a professional woman that has found many opportunities and much success in the financial services industry, Schwimmer is passionate about cultivating next-gen and female talent at Advyzon and throughout the industry.
Prior to joining Advyzon as CMO, Schwimmer served as Vice President at Northern Trust Asset Management, where she oversaw the creation of global integrated marketing campaigns and programs and also ran the content and creative team. In addition, she previously served as Marketing Director at Ariel Investments, RIA Channel Director at Charles Schwab, and Marketing Director at Hightower Advisors. Schwimmer earned a Bachelor of Arts in Communication Media Studies with a minor in Marketing from San Diego State University.
Capitalize
Capitalize, the first platform to help consumers and financial institutions digitally find and transfer retirement assets, announced the close of a $19 million Series B funding round, led by RRE Ventures. The round included participation from existing Capitalize investors including Canapi Ventures and Bling Capital, and new investors including Industry Ventures.
Since launching in 2020, Capitalize has rapidly expanded its platform to digitally locate and transfer legacy retirement accounts, and is now processing several billion dollars of rollover volume annually. Both rollover volume on the Capitalize platform and Capitalize’s revenue have grown by approximately 6x in the last 18 months.
A significant driver of Capitalize’s recent growth has been its Enterprise business, which allows leading financial institutions to embed Capitalize’s rollover technology directly into their onboarding and funding flows, helping their customers find and transfer legacy employer-sponsored retirement accounts such as 401(k)s into a new account of their choice. Capitalize now offers a full suite of enterprise-grade APIs, led by the recent launch of its Embedded Rollover API, which allows partners to leverage Capitalize technology to power rollovers in a native, seamless way.
Communify Fincentric
Communify, a Just Build It (JBI) company led by the former founders of InvestCloud, in partnership with Stellex Capital Management, will be combined with Fincentric (formerly known as Markit On Demand), a provider of digital experiences, curating financial data distribution and other solutions, which was carved out from S&P Global. The acquisition integrates Fincentric with Communify’s existing client communication, automation, and management business for the global wealth and asset management industries to form Communify Fincentric.
The newly formed Communify Fincentric represents a significant leap forward in financial technology, addressing the industry’s long-standing challenge of disjointed data sources and subpar digital user experiences. By unifying market and client data communication, Communify Fincentric offers a comprehensive, on-brand, digital platform for any financial institution through an immediately available SaaS-based product suite. This suite includes Markets Apps, Client Apps, and Advisor Apps, all enhanced with the design, advanced AI, automation and personalization capabilities for which the JBI and Fincentric teams are known.
Building on Fincentric’s strong presence in the US brokerage and self-directed investor markets, Communify Fincentric is poised for both domestic and international expansion, with a focus on serving the broader wealth and asset management industries. The company’s reach is made possible by a flexible delivery model, offering both off-the-shelf products and customized solutions for large organizations worldwide. Communify Fincentric will combine Fincentric’s 30-year legacy, which includes serving more than half of the top online brokerages in the US, with Communify’s cutting-edge design & technology expertise, in an effort to create a powerhouse in financial data communication and management.
Frec
Frec, the innovative investment platform making direct indexing accessible to investors, has reached the significant milestone of accumulating $100 million in customer assets nine months after launching.
The firm also announced the launch of four new direct indices; Russell 1000, Russell 2000, Russell 3000, and CRSP ISS US Large Cap ESG. This expansion increases Frec’s total offering to nine indices, establishing it as the first and sole consumer investment platform providing such a diverse range of direct indexing options.
Direct indexing, an investment strategy that allows investors to directly purchase the individual components of an index, has been gaining traction among mainstream investors. It enables investors to track the returns of an index while benefiting from the ability to offset capital gains with any losses. In the past, this strategy was available via wealth advisors at high minimums and fees. However, advancements in technology, such as fractional shares and commission-free trading, have lowered the barriers to investing and reduced the complexity of the strategy. Frec has seized this opportunity to deliver the greatest choice and flexibility for these investors.
FusionIQ
FusionIQ announced a mutual referral agreement with interVal, a leading provider of software that empowers wealth management firms, financial institutions, and accounting firms with automated insights for small and medium-sized businesses (SMBs) across North America. The collaboration is expected to create significant synergy that will transform how financial advisors leverage wealthtech to deliver business health and growth opportunities for clients.
The partnership, born out of a shared vision for democratizing wealth and delivering exceptional value, will leverage FusionIQ’s and interVal’s expertise to allow financial advisors to scale their operations efficiently for profitable organic growth. This innovative strategy resonates with the evolving needs of advisors seeking to harness the power of digital transformation.
One of the core objectives of the partnership is to show how easy it is for wealth management firms to grow AUM with the proven wealth technologies interVal and FusionIQ have developed for financial advisors. interVal’s tools offer accurate valuations of non-liquid assets, enabling advisors to deliver better service and secure referrals from satisfied clients. The cloud-native all-in-one FusionIQ One platform is designed to offer a frictionless and personalized user experience, seamlessly connecting investors, advisors, and firms in a single digital workflow which is crucial for retaining and attracting clients and firm talent. Through their collaboration, FusionIQ and interVal provide financial advisors with the advanced technology they need to automate their practices, creating opportunities for increased growth, efficiency, and productivity.
Grant Thornton
Grant Thornton, one of America’s largest brands of professionals providing end-to-end audit, assurance, tax, and advisory services, has named Will Whatton to lead the firm’s OneStream Software practice.
OneStream is the leading enterprise finance management platform that unifies core finance and operational functions – including financial close, consolidation, reporting, planning and forecasting – to modernize and increase strategic impact of the Office of the CFO.
Grant Thornton is a OneStream Global System Integration Partner, delivering strategic solutions with the OneStream platform for our clients’ business operations. Grant Thornton and OneStream work together to help companies optimize their corporate performance management with a focus on quality, scalability and value all within the secure OneStream platform.
Nitrogen
Nitrogen (formerly Riskalyze announced the availability of its summer 2024 product release. In a launch event attended by more than 1,000 financial advisors, Nitrogen’s product team shared new features added to its products: Nitrogen Risk Center (risk tolerance, proposal generation), Nitrogen Research Center (investment analytics and research), Nitrogen Planning Center (specialized financial planning), Nitrogen Command Center (firmwide controls) and Nitrogen Marketing Center (advisor content marketing).
The summer 2024 release also focused on driving greater performance and a higher-quality user experience across all products. These updates have resulted in 40% faster load times in many cases and reduced latency for key daily advisor and firm executive operations.
Nitrogen also highlighted an accounts-based pricing model for teams who prefer to provision unlimited users as they scale, as many firms have already adopted the new structure in the past few weeks.
Opto Investments
Conway Investment Solutions, LLC (“Conway”), a collaborative investment solutions partner for financial advisors, announced a strategic partnership with Opto Investments (“Opto”), the technology-enabled solution expanding private markets access for independent investment advisors. This partnership enables Conway and Opto to provide registered investment advisors (RIAs) with an end-to-end solution for creating actively managed private markets vintage funds, providing access to bespoke investment strategies supported and delivered by modern technology.
The challenges of limited access, expensive fee structures and large investment minimums, coupled with the operational complexities of managing private markets portfolios, have historically made it difficult for RIAs to invest client capital in private credit, private equity, real estate, venture capital and other private asset classes. By combining the institutional-quality investment research and due diligence capabilities of Conway and Opto, advisors will be able to create private markets solutions from a broad but highly curated universe of opportunities tailored to clients’ individual needs and objectives.
Leveraging Opto’s technology platform and custom funds offering, these new vintage fund strategies provide advisors and investors access to private funds at lower minimums via a simplified digital subscription process, eliminating many of the challenges typically associated with private markets investing.
Orion
Franklin Templeton announced the availability of a broad range of equity separately managed account (SMA) models on wealthtech solutions provider Orion’s platforms. The arrangement will provide enhanced access to Franklin Templeton’s diversified SMA product suite, across its specialist investment managers, by advisors who utilize those investment models in managing their investors’ accounts on the Orion Communities and Orion Portfolio Solutions (OPS) platforms.
Orion Communities, an open-architecture model marketplace, offers a diverse selection of investment models from various providers, allowing for greater flexibility and choice. The OPS platform features a curated list of research-approved, high-quality investment options. As a fast-growing Turnkey Asset Management Program (TAMP) platform, Orion provides a robust, open architecture infrastructure for delivering Franklin Templeton’s innovative investment solutions to advisors for use with their investors.
Franklin Templeton’s equity SMA models are designed to offer tailored investment solutions, leveraging the firm’s expertise and its comprehensive lineup of specialist investment managers from Franklin Templeton, ClearBridge Investments, Putnam Investments, Martin Currie and Royce Investment Partners.
SigFig
SigFig, a digital wealth management solutions and technology provider for financial institutions and their advisors, announced new capabilities, including AI-powered functions, to its financial advisor collaboration platform, Engage.
Powering collaborative digital experiences for the most essential aspects of financial advisor and client relationships, Engage is purpose-built to blend human expertise and technology. The platform combines a robust set of capabilities, including AI-powered assistance for advisors and their teams to increase their effectiveness, core integrations with leading industry systems to drive efficiencies and collaborative digital experiences to drive deeper client engagement.
Engage also makes it easier for advisors to deliver personalized advice by seamlessly integrating with their most utilized systems, including Salesforce, Docusign, Microsoft and Google. The CRM integration establishes a bi-directional data sync allowing advisors to view client data in the Engage platform, and more importantly, sync meeting notes, updated client details, follow-up meetings and tasks into Salesforce – helping position the advisor to accelerate the sales process and client conversions. An open-architecture approach provides the flexibility to connect with proprietary systems.
Snappy Kraken
Snappy Kraken announced the official rollout of Snappy Kraken Enterprise, a complete marketing technology solution tailored for mid-market and enterprise firms, including registered investment advisors (RIAs), broker-dealers and independent marketing organizations (IMOs). Snappy Kraken Enterprise supports complex operations at mid-to-large financial services organizations by offering a comprehensive platform that enhances organic growth and boosts client engagement. It provides in-depth analytics and advanced marketing tools to attract and retain top-performing advisors, scale growth strategies and execute compliant marketing campaigns efficiently.
Snappy Kraken Enterprise is built to scale, allowing large organizations to maintain brand consistency while empowering individual advisors with cutting-edge marketing and engagement tools. Financial companies can enhance advisor recruiting and retention by leveraging Snappy Kraken’s comprehensive enterprise solution, which provides data-backed insights on client and prospect engagement, along with differentiated marketing strategies. Additionally, Snappy Kraken Enterprise enables users to build and track automated marketing campaigns powered by custom integrations, AI-driven content creation tools and comprehensive performance reporting. It also streamlines administration and compliance processes, helping to ensure efficiency and regulatory adherence.
Building upon Snappy Kraken’s track record of success with smaller RIAs and existing enterprise customers, this expanded enterprise offering delivers added customization capabilities, advanced reporting and tools specifically designed for managing large networks of advisors.
Trust & Will
Trust & Will announced its new subscription model for financial advisors so they can incorporate this essential service in a cost-effective manner.
Trust & Will released its subscription pricing model to give advisors flexibility on how they want to deliver estate planning services. The competitive seat-based pricing provides unlimited estate plans; the other pricing option is clients can pay for their plans as needed. The streamlined advisor pricing model allows them to better achieve holistic, comprehensive financial planning while also controlling costs.
Trust & Will’s subscription pricing gives advisors a unique option that competitors do not. Unlike other estate technology providers that only offer a single fee structure, Trust & Will meets the demand for flexible pricing with strong buy-in from the 13,000 advisors and firms utilizing Trust & Will. This comes after the recent partnership with LPL Financial as well as the product enhancements that empower advisors to uncover opportunities through its estate summary, visualization, and personalized insights. Trust & Will helps advisors uncover opportunities for their clients, adding to their advisor satisfaction and financial success.
Vanilla
Vanilla announced strategic fundraising led by returning investor Insight Partners, in addition to contributions from Venrock, Vanguard, and other previous investors. Vanilla also welcomes a new strategic investor, Edward Jones Ventures*, and new investor Alumni Ventures. In addition to supporting its rapid growth and customer adoption, the company will use the funding to expand its platform, including its first-of-its-kind embedded AI technology, to revolutionize how financial advisors and estate planners help households of all wealth levels build their legacy.
The investment comes at an opportune moment for both the company and the greater wealth management industry as the adoption of estate planning software gains significant traction. According to the most recent T3 survey, the use of estate planning software spiked sharply among advisors, with a 259% increase over the last two years.
Vanilla is leading and pioneering a new approach to fundamentally alter the $221 billion estate planning industry with its comprehensive, fully digital estate planning platform – the Estate Advisory Platform. Recent innovations in V/AITM, Vanilla’s AI technology for estate planning, and Vanilla Document BuilderTM, an on-demand trust document offering, complement Vanilla’s leading client estate summaries. Designed to simplify the legacy-building process from start to finish, the platform enhances client and advisor education, visualizes plan structures, illustrates how assets work with their plan, proactively monitors for changes, and supports document creation and plan execution.
