Fidelity Investments acquires eMoney Advisor

Fidelity Investment acquires eMoney Advisor

Fidelity Investments’ acquisition of eMoney Advisor makes the custodian invested in financial planning software.

Updated 7:54 AM ET, February 3, 2015 with valuation information

Fidelity Investments today announced the acquisition of eMoney Advisor, the Conshohocken, Pennsylvania-based provided of popular financial planning and adviser marketing solutions.

Terms of the acquisition were not disclosed by Fidelity Investments.

“North of $250 million”

Some sources cited a purchase price “north of $250 million” and a valuation of four times eMoney’s annual revenue in this article.

Sources not authorized to speak publicly on the matter told me the valuation was closer to eight times eMoney’s annual revenue for a purchase price between $250 and $300 million. (Note: we’ll never know the true terms as both companies are privately held and not required to disclose the terms.)

The Guardian Life Insurance Company of America® will retain a minority interest in eMoney Advisor and will continue to use the solution as one of eMoney’s largest clients.

Independent Planning

Today’s acquisition marks the first time I can recall an institutional custodian has taken majority ownership of a financial planning software provider.

I’ve taken the liberty of listing many of the other popular financial planning solutions along with their respective parent company affiliation(s) where applicable.

  • MoneyGuidePro, owned by PIETech, Inc., Private
  • FinanceLogix, owned by OLTIS Software, LLC., Private
  • inStream Solutions, Inc., Private, unknown private equity affiliation
  • Advicent Solutions (provider of NaviPlan® and Profiles™), Vista Equity Partners, a U.S.-based private equity firm
  • Guide Financial, Private
  • MoneyTree Software, Private
  • Advizr, Private
  • SunGard, operating under SunGard Financial Systems, a subsidiary of SunGard Data Systems Inc., Private under ownership of Bain Capital LLC, Blackstone Group LP, Goldman Sachs Capital Partners LP, KKR & Co LP, Providence Equity Partners Inc, Silver Lake and TPG Capital LP
  • WealthTec, Private
  • GoalGamiPro, Advisor Software, Inc., Private

If you have more details regarding the providers listed or wish to add any solutions to the list, please contact me.

Accelerating Integrations

Several questions come to my mind once Fidelity Investments finishes its eMoney acquisition.

Will eMoney continue to support integrations with competing institutional custodians, or is a walled garden strategy coming for the popular planning software? Will the new ownership expand integrations and custodial support, restrict them, or simply maintain today’s status quo?

Ed O’Brien, senior vice president of Technology Platforms for Fidelity Institutional, and Edmund Walters, eMoney Advisor Founder and CEO, graciously carved out a few minutes to converse by phone regarding my questions.

“Our vision at eMoney is not just about delivering financial planning, but making the adviser’s life easier through technology,” said Walters. “Developing integrations with leading technology providers allows us to do that, and now with Fidelity behind us, we will accelerate it.”

O’Brien added by saying, “We want eMoney to continue to accelerate their role in the marketplace to deliver the best advisor experience possible, and that helps make what Fidelity does better.”

In addition, eMoney publicly assured others with similar questions that the company will “continue to operate independently as a standalone entity” in an update on the company Twitter feed this morning.

How Will Custodians Respond?

Consider, however, the perspective of other custodians serving independent financial advisers. How eager will they be to integrate and pass data to eMoney Advisor once it falls under ownership of a competing custodian?

For example, TD Ameritrade Institutional just announced at its conference last week that the new Veo One™ platform will soon integrate data from eMoney Advisor (watch Veo One preview from the National LINC 2015 Conference).

With eMoney falling under Fidelity Investments’ ownership, what’s in the future for eMoney integrations supported by competing custodians?

The question is not specific to TD Ameritrade Institutional. eMoney Advisor is used by over 25,000 financial professionals, who collectively use the institutional custody and broker-dealer services from a variety of providers, including Schwab Advisor Services, TD Ameritrade Institutional, LPL Financial, and Pershing, LLC (under The Bank of New York Mellon Corporation).

This is a developing story. Instead of email you can message me on Cyber Dust at billwinterberg 


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