Wealthtech Roundup: iCapital, Addepar, BetaNXT, Pershing And More

Q&A With Jason Broder Of iCapital – Our Wealthtech Leader Of The Month – And Product News Featuring Addepar And Corient, Wealth.com And Facet, FusionIQ And Interactive Brokers Canada, Flourish And RightCapital, Envestnet And Salesforce, Docupace, BetaNXT, Asset-Map And Pershing.
Jason Broder, Managing Director and Chief Product Officer, iCapital
Jason Broder, Managing Director and Chief Product Officer, iCapital
Chris Latham, Managing Editor, Wealth Solutions Report
Chris Latham, Managing Editor, Wealth Solutions Report

In this edition of the Wealthtech Roundup, we speak with our newest Wealthtech Leader of the Month, Jason Broder, Managing Director and Chief Product Officer at iCapital, who discusses how distributed ledger technology (DLT) intersects with alternative investments.

Other entries include Addepar partnering with Corient on data aggregation and reporting, wealth.com partnering with Facet on estate planning, Docupace announcing its 2024 Back Office Heroes Award Winners, FusionIQ integrating with Interactive Brokers Canada on portfolio management, BetaNXT appointing Robert Santella as CEO, Asset-Map conducting an advisor survey on next-gen clients, Flourish integrating with RightCapital on cash holdings and annuities, Envestnet partnering with Salesforce on advisor pain points, and Bank of New York Mellon’s Pershing hosting its 26th annual INSITE Conference.

Larry’s Take

Larry Roth, CEO, Wealth Solutions Report
Larry Roth, CEO, Wealth Solutions Report

Last summer, BetaNXT CEO Stephen Daffron discussed with WSR the impending shift to T+1 settlement. Last week, the shift occurred. Now stock trades settle (buyers receive shares, and sellers receive cash) in one business day instead of two business days. Investors who sell shares from their brokerage accounts can use that cash the next business day. The shift also lowers how much cash brokers need to place with the Depository Trust & Clearing Corp.

Faster processing feeds the sensation of instant gratification, which could prompt more people to pursue self-directed trading – whether or not they also have financial advisors. It also could increase overall client expectations that advisors will respond immediately to client requests in general. And it is likely to put a heavier burden on custodians, broker-dealers and RIAs to ensure that clients receive timely and accurate information about their holdings.

Advisors switching firms, and firms conducting M&A deals, should ask the firms they intend to get involved with how they have addressed the shift to T+1. This is one of those things that’s easy to overlook, because it seems like back-office mechanics instead of client-facing, or simply out of the advisor’s hands. But clients care about their money. Rather than get caught off-guard by an unlikely reporting glitch, everyone should take the time now to prepare useful answers.

If you would like to discuss this Larry’s Take further, including how these trends might impact your business, please contact me at larry.roth@rlrstrategicpartners.com.

1. iCapital Discusses Its New Distributed Ledger Technology

Jason Broder, Managing Director and Chief Product Officer, iCapital
Jason Broder, Managing Director and Chief Product Officer, iCapital

iCapital, an alternative investments operating system provider, has been busy in recent weeks. It recently launched the first fund leveraging iCapital’s new distributed ledger technology. The fund is distributed by UBS Wealth Management and administered by Gen II. Subscriptions, capital activities, reporting and liquidity will be orchestrated through the DLT, which automates data and document connectivity between firms.

In May, iCapital also announced partnerships with Commonwealth, Gratus Capital, MassMutual and Resona Bank; launched the iCapital Multi-Asset Portfolio (iMAP) for alternative investments; and completed its acquisition of the wealthtech firm Mirador.

And now for our Q&A with Jason Broder, Managing Director and Chief Product Officer at iCapital.

WSR: What is distributed ledger technology and how does it apply to alternative investment funds?

Broder: In the past, alternative investment transactions, transfers and performance have been difficult to track due to a reliance on 20th century technology and manual processes. The launch of iCapital DLT is part of our commitment to enhancing the entire alternative investing experience and enabling the industry to operate with efficiency, precision and ease.

Distributed ledger technology uses a decentralized network of ledgers to store data in a way that is secure, transparent, synchronized and accurate. iCapital’s DLT solution serves and connects firms across the investing ecosystem, including fund managers, administrators, transfer agents, wealth managers, advisors, custodians and tax providers, who each require timely, precise data to manage alternative investments on behalf of individual investors. The technology eliminates the need for each party to manage multiple integrations across partner firms, reconcile data and documents to their records, and maintain conflicting workflows across funds.

WSR: iCapital straddles technology and investments. Is it more of a technology company, or an investments platform, or both?

Broder: While I’d say that iCapital epitomizes the term “fintech,” our mission and industry position can’t be captured with a simple label. We are leading the digital transformation of the global alternative investing marketplace by constantly innovating and leveraging cutting-edge technologies like DLT to provide the 100,000-plus U.S. financial advisors on our platform with considerable operational efficiencies and convenience.

Recent launches like the iCapital Marketplace and Architect, our portfolio construction tool, really help showcase our commitment to this type of client-first innovation. To put it simply, iCapital’s operating system automates and streamlines the complex process of private market investing by providing the alternative investment ecosystem with an industry-leading suite of tools, end-to-end enterprise solutions, data management and distribution capabilities.

WSR: What else does iCapital have in the works for the wealth management industry in 2024?

Broder: It has been a busy time at iCapital lately with the rollout of iCapital DLT and iCapital’s first model portfolio for alternative investments and a first-of-its-kind solution for the wealth management industry. We plan to launch additional model portfolios that will complement iMAP later this year. In addition, we are in discussions with some of our clients about creating customized models. Working with our in-house team, advisors will be able to build a unique model that is specific to an individual client’s goals.

We’re also launching a new multi-investment tool that will enable our clients to invest in multiple funds within a single workflow, paving the way to use alternative investment models at scale within the portfolio construction context. And of course, we have a robust roadmap for expanding our DLT capabilities through year-end, and we expect to add additional funds on iCapital DLT in the back half of 2024.

2. Addepar To Handle Corient’s Portfolio Data Aggregation And Performance Reporting

Eric Poirier, CEO, Addepar
Eric Poirier, CEO, Addepar

Addepar, a global technology and data company for investment professionals, partnered with Corient Private Wealth to serve as the exclusive platform for portfolio data aggregation and performance reporting across Corient’s more than $160 billion in assets for high and ultra-high net worth clients.

Addepar’s APIs and partner ecosystem allow each user firm to tailor the solution for a bespoke view of investment portfolios. The firm has over $6 trillion of client assets managed on its platform and serves more than 1,000 client firms including family offices, wealth managers, large banks and global institutions, across more than 45 countries.

“As the industry continues to consolidate, Addepar is committed to meeting our clients where they are to transform the way investment professionals manage important client relationships and deliver on a full offering to create lasting value,” said Eric Poirier, CEO of Addepar. “Like Corient, Addepar is committed to delivering unrivaled client excellence, and we believe this partnership will do just that.”

3. Wealth.com Teams With Wealthtech RIA Facet On Estate Planning

Tim White, Co-Founder & Chief Partnership Officer, wealth.com
Tim White, Co-Founder & Chief Partnership Officer, wealth.com

Estate planning platform wealth.com partnered with subscription-based wealthtech firm Facet, enabling Facet financial planners to manage members’ estate planning needs. Facet, an SEC-registered RIA, offers estate planning through wealth.com as part of Facet’s Complete membership and as a standalone service. Facet offers a flat-fee model.

CFPs at Facet can leverage the wealth.com platform to manage the estate planning process, including access to local vetted trust and estate lawyers. Last year, wealth.com launched Ester, an AI-based legal assistant designed to automate tasks traditionally handled by financial analysts and in-house paralegals so advisors can deliver customized wills, trusts and other documents.

“Facet and wealth.com are aligned in a vision that seamlessly combines cutting-edge technology with human expertise,” White said. “At wealth.com, we are committed to innovating on behalf of advisors, driving the industry towards a transformative shift where estate planning becomes an integral part of mainstream financial discussions.”

4. Docupace Names 2024 Back Office Heroes Award Winners

David Knoch, CEO, Docupace
David Knoch, CEO, Docupace

Digital and automated operations software provider Docupace announced its 2024 Back Office Heroes Award Winners. Lauren Mulligan, Director of Client Services at Forefront Wealth Partners, is the 2024 Firm Hero. Kimberley Harvey, Business Analyst at Country Financial, is the 2024 Home Office Hero. And Austin Vashaw, Senior Customer Support Representative at Docupace, is the 2024 Employee Hero.

Mulligan was recognized for her consistency in communicating with others, her meticulous attention to detail and her determination to get things done. Harvey was recognized for her patience and willingness to help others, and pursuing excellence in the advisor, client and home office experience. Vashaw was recognized for his exceptional responsiveness, proactive problem-solving skills and collaborative efforts.

“What defines a back office hero? A back office hero is the person who ensures that the behind-the-scenes work is taken care of so others can focus on helping clients. They are the backbone of wealth management firms, and without them, they wouldn’t be able to do what they do,” Docupace wrote on its website.

Mark Healy, CEO, Fusion IQ
Mark Healy, CEO, Fusion IQ

FusionIQ, a cloud-based wealth management solutions provider, integrated with automated global electronic broker Interactive Brokers Canada to provide benefits for portfolio managers, including access to the Hybrid Digital Advice platform in FIQ Journey. Hybrid Digital Advice is one of four modules on the cloud-native FusionIQ One platform.

FIQ Journey’s Hybrid Digital Advice platform for portfolio managers offers functionality including white-labeled investor websites; digital-first client experiences, including a mobile app; multilingual structure; and access to a mass affluent solution. In March, FusionIQ launched FIQ Market One on the FusionIQ One platform. In May, it launched FIQ Freedom.

“FusionIQ’s integration with Interactive Brokers Canada represents a significant opportunity for financial advisors to leverage advanced technology and enhance their competitive edge in the industry,” said Mark Healy, CEO of FusionIQ. “This integration marks a significant step forward in our mission to provide Canadian advisors with the white-labeled wealth management platform they need to thrive in today’s digital landscape.”

6. BetaNXT Appoints Robert Santella As CEO, Daffron To Remain As Executive Chairman

Robert Santella, Incoming CEO, BetaNXT
Robert Santella, Incoming CEO, BetaNXT

BetaNXT, a provider of wealth management infrastructure solutions with real-time data capabilities, appointed Robert Santella as CEO effective July 1, when he succeeds Stephen Daffron, who will stay on as Executive Chairman. Santella has over 30 years of experience in trading technology and wealthtech. BetaNXT’s backers include Clearlake Capital Group and Motive Partners.

Most recently, he was CEO of IPC Systems, a provider of communications and multi-cloud connectivity solutions for financial markets. Before that, Santella was President of Global Trading at SunGard Financial Systems, where he started as Chief Operating Officer of the Broker-Dealer Group. He served as President of Global Trading at FIS after it acquired SunGard. Earlier in his career, Santella was COO and President of Fox River Execution and SAM Investments.

“Steve has successfully led the carve-out of BetaNXT and communicated a clear strategy for powering the next generation of frictionless, end-to-end wealth management,” Santella said. “As the company has gone from strength to strength and grown its reputation in the marketplace, I am proud that he has chosen to pass the torch to me, and I look forward to working alongside the teams at BetaNXT, as well as Clearlake and Motive Partners, to accelerate the future of connected wealth.”

7. Asset-Map Conducts Survey Of 175 Advisors On Next-Gen Clients

Adam Holt, CEO, Asset-Map
Adam Holt, CEO, Asset-Map

Asset-Map, whose software provides an interactive holistic view of a household’s financial picture to help professionals with client conversations, released survey findings based on responses from 175 advisors on obstacles to assessing next-gen clients. Regarding the biggest obstacle to incorporating new technology into their practices, 35% of respondents pointed to cost and 31% said it was the difficulty of learning the software.

“Asset-Map was seeking to practice what we preach to financial advisors, to prove they know their clients,” Adam Holt, CEO of Asset-Map, told WSR. “In running this survey of financial professionals using Asset-Map in their practice, our interest was in learning from those willing to share how they are looking at their wealthtech solutions, the opportunities and challenges associated with growth in the next-generation space, and more.”

Holt, who was a CFP-holder for 25 years before founding the company, added: “The survey indicated a clear perception that next-gen successor clients do not understand the value proposition of a financial advisor, and coupled with the need to invest in technology, retirement planning and organic growth in the pre/post retirement space is still dominating the focus of professional clients.”

8. Flourish Integrates With RightCapital On Cash Holdings And Annuities

Max Lane, CEO, Flourish
Max Lane, CEO, Flourish

Flourish, a financial products provider that serves RIAs, integrated with RightCapital, a financial planning platform for advisors and their clients. The integration allows advisors to incorporate cash holdings and annuities from Flourish’s product suite into RighCapital’s Net Worth tab.

RightCapital’s market share has more than tripled since 2020. Its platform offers interactive retirement planning, cash flow- and goals-based planning, tax-efficient distribution strategies, insurance needs evaluation, student loan management, estate planning and more. Flourish Cash recently surpassed $5 billion in assets under custody (AUC), more than tripling AUC in the last two years, and is used by more than 750 firms representing over $1.5 trillion in assets under management (AUM).

“In today’s landscape, clients want more than just portfolio management from their advisors. By obtaining a comprehensive understanding of their clients’ entire financial landscape, advisors are better equipped to provide superior financial guidance,” said Max Lane, CEO of Flourish. “We are delighted to announce our integration with RightCapital, a platform that also earned ‘Software All Star’ status in the 2024 T3 / Inside Information Software Survey alongside Flourish’s products.”

9. Envestnet Partners With Salesforce To Address Advisor Pain Points

Matt Wilson, Head of MoneyGuide Sales, Envestnet
Matt Wilson, Head of MoneyGuide Sales, Envestnet

Envestnet partnered with Salesforce on a financial planning experience for Envestnet customers using Salesforce’s Financial Services Cloud (FSC). The goal is a more unified platform experience for advisors – and to solve pain points such as operating across systems and applications, and lack of data parity between CRM and financial planning platforms.

Advisors and financial services professionals in the U.S. will be able to view financial plan information for clients within their CRM, target and track clients using actionable segmentation dashboards, launch in MoneyGuide, unify customer behavioral and financial data across an advisor’s practice, as well as simplify team collaboration with a single source for financial planning-related activities.

“Financial planning is more critical than ever in today’s wealth management landscape,” said Matt Wilson, Head of MoneyGuide Sales at Envestnet. “Our collaboration with Salesforce empowers advisors to deliver personalized and comprehensive financial advice to their clients across any life stage and wealth level.”

Wirehouse / Big Bank Activity

10. Bank of New York Mellon Pershing Hosts 26th INSITE Conference

Jim Crowley, Global Head, BNY Mellon’s Pershing
Jim Crowley, Global Head, BNY Mellon’s Pershing

The Bank of New York Mellon’s Pershing hosts its 26th annual Pershing INSITE conference from June 4 to 6 at the Gaylord Opryland Resort and Conference Center in Nashville, Tennessee. INSITE typically attracts more than 2,000 financial advisors, fintech providers, wealth management firm executives and other industry leaders.

Agenda topics include “3 Changes Your Enterprise Needs to be Ready for Wealtech’s Next Evolution by AdvisorEngine”; “Tech Experience Upgrade: How Clients Evaluate Your Value”; and “Using Artificial Intelligence to Solve Real Problems.” This year also features an interview moderated by Bloomberg’s Carol Massar with Hanneke Smits, Global Head, BNY Mellon Investment Management, and Jenny Johnson, President and CEO, Franklin Templeton, about the “rapidly changing global financial market.”

“It’s a special milestone year for BNY Mellon, which is celebrating its 240th anniversary, and INSITE 2024 will showcase the many ways we are focused on doing more and being more for our clients today and into the future,” said Jim Crowley, Global Head of BNY Mellon’s Pershing. “We launched our Wove advisory platform at last year’s conference and I’m excited to debut new features to the platform that will help us deliver on our promise to power the future of wealth management.”

Chris Latham, Managing Editor at Wealth Solutions Report, can be reached at clatham@wealthsolutionsreport.com

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