Guide Financial, the financial planning startup acquired by John Hancock in June 2015, told its users via email this week that the company plans to discontinue operations on October 11.
Intuit Aggregation Wake
Guide Financial is the first financial adviser technology provider that I know of that has decided to close its operations in the wake of Intuit’s announcement that it is discontinuing its Financial Data APIs for account aggregation. Those APIs will be maintained only for current production developers until November 15, 2016, Intuit said in an email to developers.
In a phone call with Guide Financial, I learned that the company first attempted to contact as many advisers as possible by phone to communicate the news, and those who were not able to be reached received an email with the details of the shutdown on Thursday.
In the email, the company noted that Intuit had recently announced the discontinuation of the account aggregation services that powered the Guide Financial Service. But in my post from March 2015, How Intuit’s account aggregation shutdown may impact the fintech solutions you use, Intuit told developers that Finicity would be providing façade APIs to facilitate the transition from Intuit to Finicity for aggregation services. Guide Financial did not comment on the option to transition to aggregation provided by Finicity.
No Data Exports
In the weeks prior to the shutdown, Guide Financial users will not have the ability to request an export of their data contained in the system. Generally, data on clients is limited to basic demographic information and is likely to be found in other systems used by advisers, such as CRM and portfolio management software, so an export of that data would not be useful in most circumstances. Guide Financial said that transaction data aggregated from financial institutions will not be made available.
Guide Financial has offered a brief FAQ on its website regarding the transition, and additional questions can be directed to support@guidefinancial.com
Alternatives
For alternatives to Guide Financial, I can think of a few financial planning and financial dashboard solutions that perform account aggregation to update financial plans. The list of the solutions are below:
eMoney Advisor, $1,944 to $3,888/year depending on features, including aggregation and an online client dashboard
Right Capital, under $1,000/year including aggregation
MoneyGuidePro, $1,295/year (I think aggregation is an additional $365/year, but I’m not 100% sure, and clients do not see an online dashboard for their outside accounts)
Note: I originally listed Balance Financial in the list of alternatives above, but I have not been able to connect with them for any updates. Also, their website’s terms and conditions have not been updated for two-and-a-half years (last updated January 28, 2014). Until I connect with someone at Balance, I’ll keep them listed in this note and not as a viable alternative to Guide Financial.
There are other solutions that perform aggregation (ByAllAccounts, Aqumulate, Quovo, Blueleaf, Wealth Access, etc.), but they generally don’t also have financial planning capabilities built directly in to the program.
If you can think of other solutions that should be on this list, contact me (or tweet me @billwinterberg) and I will update this list.
On today’s broadcast, Vanare announces two integrations that should raise a few eyebrows, and relationship intelligence gains momentum in the apps you might be using in your business.
Here are the codes you can use to save money on your event registration (Important! These are coupon codes, NOT affiliate links. I do not get any affiliate revenue if you register for the events):
[Now on to this week’s top story that comes from Vanare, taking advantage of the slow summer to announce a new integration with Redtail Technology. Phase one of the integration is available today, which allows Vanare users to automatically create a new client record in Redtail CRM anytime a client completes the on boarding process in Vanare.
Subsequent phases, being rolled out later this Fall, promise to support two-way data sharing between the applications to better synchronize data on client activity and status reports.
But wait! You don’t have to be a Vanare customer to automatically populate new client records in Redtail. If you remember back in episode 185, Redtail announced its integration with Zapier, allowing you to use triggers in any application supported by Zapier to fire off an action in Redtail. Then in episode 186, I mentioned Wealthbox CRM’s Zapier integration.
And if you subscribe to Zapier’s premium plan, you get support to automate actions in Salesforce and Microsoft Dynamics. So maybe it’s time to check the application you use for Zapier compatibility, and if they’re not supported, maybe you need to ask for it.
Now, back to Vanare, I want to also point out an announcement from a few weeks ago about Vanare’s support for Apex Clearing. This is first time I’ve heard of while-labeled robo advisor solution for advisors that supports Apex, which is the same clearing firm used by many of the larger direct-to-consumer investment services like Betterment, Wealthfront, and Robinhood.
Why is this important? Because other turnkey robo services for advisors use custody services from Folio Institutional, TD Ameritrade Institutional, and other, and when you look at their all-in custodial fees, I don’t think they are as competitive as Apex.
Now you could elect to work with Apex directly on your own proprietary investment solution, but that takes time, expertise, development, and other resources that you probably don’t have, so that’s why Vanare’s offering that sits on top of Apex is worth taking notice.] Vanare, an innovative wealth management technology platform, and Redtail Technology, a leading provider of client relationship management (CRM) solutions for financial services firms, have launched an integration that will allow Vanare users to sync client contact information directly from their Redtail CRM.
[Next up, I want to talk a little more about CRMs by talking about Salesforce, as this week the company announced an update to the Salesforce Inbox app. After last year’s acquisition of the calendar app called Tempo, Salesforce Inbox now has an enhanced calendar with one-click conference dialing, Sales Cloud data synchronization, and CRM record integration.
Still absent, though, is the contextually relevant info about clients and prospects invited to a meeting that Tempo used to provide, which could include Facebook updates or changes to the LinkedIn profile of meeting participants.
If this automated dossier concept sounds familiar, that’s because it’s similar to an app called Refresh that I told you about back in episode 159, which was subsequently acquired by LinkedIn, which is now part of Microsoft. Also, Salesforce acquired RelateIQ a while ago which powers the SalesforceIQ product with its trademarked Relationship Intelligence™ technology.
So here’s my important takeaway: There are just some things you can’t remember or keep up to date with about each and every client you have. Solutions powered by Microsoft and Salesforce and others, which arguably resemble CRM software, do a lot of the heavy lifting in the background, so you can focus on relationship development and not mundane data gathering.
Again, if you see how your business can be better with automated tools like these, you might want to mention it to your provider and be sure it’s on their road map.] Salesforce’s efforts to turn its Inbox app into a central resource for salespeople has a new trick: An integrated calendar built from its acquisition of Tempo that pulls in contact data from your Salesforce database, giving you a way to quickly find out more about the people you’re meeting with.
Here are the stories that didn’t make this week’s broadcast:
Hearsay Social says it is rolling out a client engagement platform that helps advisors reach clients and prospects more easily and more quickly via social media, their websites, email and text messages.
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[Get ready for the robo news, as this week’s top stories come from Fidelity Investments and TD Ameritrade, as both financial institutions recently announced online investing solutions for the retail investor. A few days ago, Fidelity officially rolled out Fidelity Go, specifically targeting digitally savvy customers in their 20s, 30s, and 40s, with investment assets in the low six figures.
When asked by Investor’s Business Daily what happens when Fidelity Go customers get older and wealthier, Rich Compson, head of managed accounts at Fidelity, responded that customers would be referred “to other services like Fidelity’s Portfolio Advisory Services.”
Ok, ok, but advisors aren’t completely left out, as Fidelity did promise details about an automated service it’s developing for financial advisers by year-end. That’s, details, by year-end.
And a few weeks ago, TD Ameritrade announced it had completed updates to its Amerivest Managed Portfolios retail offering, including a digital overhaul for better goal setting, performance tracking, and more.
In ThinkAdvisor’s interview with incoming CEO Tim Hockey, he said that the company will be using Amerivest’s tech enhancements “to launch a new robo for the self-directed client’s needs” scheduled for sometime in 2017.
When asked about referrals to RIAs who custody with TD Ameritrade Institutional, Hockey added that retail clients with $1 million dollars or more are the “target referral” for affiliated RIAs.
That comment came out at the same time the company announced a program with the XY Planning Network to provide dedicated service and no minimum asset requirement to use TD Ameritrade Institutional’s custody services. That’s good, it’s gotta be awkward knowing TD Ameritrade is going to target digitally savvy investors, aka potential XYPN clients, with their own retail robo solution.
On top of all that, Wells Fargo also announced that it, too, is entering the robo market, with a solution expected also sometime in 2017.
And if you don’t like today’s current robo solutions, you can go build your own robo algorithm with Quantopian, who just received fresh venture capital this week from hedge fund investor Steve Cohen.
That’s it, all I hear all day long is how great robos do this, or how wonderful robos do that: robo, robo, robo!]
[Now in NON-robo news, how about an update from Envestnet | Tamarac, as the company released the latest version of its client portal to advisors who use the Advisor View™ application. If you watched my coverage of the Envestnet Advisor Summit earlier this year, you would have seen a preview of the updated client portal, plus the key enhancements highlighted by Brandon Rembe. So click right here so you can watch that video.] Envestnet | Tamarac has completely redesigned the client portal in its Advisor View™ portfolio management and performance reporting application. The new client portal will be implemented as part of Tamarac’s July 2016 technology release, and seeks to help RIAs create highly customizable client portal experiences to engage their clients and appeal to the next generation of investors.
[Also, MoneyGuidePro recently released a utility called Best Interest Scout, intended to gather information about client goals, expectations, and investment details in one place. This should help you from a workflow perspective, but the tool should also be helpful in identifying when you must engage in a Best Interests Contract with a client. If you’re concerned about compliance with the pending fiduciary rule from the DoL, expect more tools like Best Interest Scout to come to market.] PIEtech, the creator of financial planning software MoneyGuidePro, has built a tool to see how well clients’ portfolios are aligned with their best interests, including retirement goals and concerns, insurance needs, and health-care costs.
Now since I took a few weeks off, I just don’t have time to cover all the stories in my backlog, including news on the talent exodus at Wealthfront, the Betterment for Business 401(k) offering surpassing 200 plan sponsors and $5 billion in AUM, Quovo, Riskalyze and more, so links to those stories are below:
Wealthfront, founded in 2008, is experiencing its first big talent exodus — a flurry of departures that includes some C-suite titles and a Unicorn shepherd.
Betterment for Business, the only turnkey 401(k) service that includes personalized investment advice for all participants, announced today that it has successfully added 200 plan sponsors to the platform in the last six months.
Betterment announced today that it is the first independent robo-advisor to reach $5 billion in assets under management. The company now helps more than 175,000 customers intelligently manage and grow their wealth.
Apex Clearing Corporation will begin offering to its broker dealer and RIA clients the ability to digitally manage investments using Vanare’s digital advice platform. Vanare offers a wealth management technology platform with a highly customizable white labeled Roboadvisor.
Advisor Software, Inc. has teamed up with Quovo to provide wealth managers with seamless access to aggregated client financial data, which can help put together an all-encompassing financial picture for every client.
Marstone, an innovative digital wealth company, and Quovo, a financial data science company for the wealth management industry, today announced that they have completed a partnership to enhance Marstone’s digital wealth solutions with Quovo’s industry-leading data aggregation.
Today’s episode is brought to you by Orion Advisor Services, the industry’s premier portfolio accounting service provider for advisors. Orion integrates with several automated investment platforms, but you’re not sure if now the right time to add a robo element to your firm.
Find out if you’re ready, or not, to add your own solution by downloading a free copy of the Orion pre-robo checklist today by visiting fppad.com/robochecklist.
[This week’s top story is all about Betterment, because in the wake of last week’s Brexit vote, the company notified financial advisors on the Betterment Institutional platform that it had suspended trading from 10am to 12pm Eastern on June 24th, citing their expectation of “highly unpredictable volatility,” a decision which has triggered all sorts of discussions across the investment community.
First, a primer. Betterment uses ETFs for all customer portfolios, and when trading gets volatile, ETF pricing can get significantly disconnected from the value of the ETF’s underlying securities. Remember the flash crash of August 2015? ETF pricing was all over the map, especially for lightly traded and illiquid ETFs.
So, when Betterment’s team identified undesirable trading conditions, they suspend all trading. And as a discretionary advisor to retail customers, they can totally do that. It’s disclosed right there on page 65 of the retail agreement, which every customer acknowledges they read by checking the I agree box next to the Sign Up button. <wink wink>
But the exact same language is on page 70 of the Institutional Agreement, and I couldn’t find anything that said trading *authorized by the Advisor* would be treated any differently. In the RIABiz coverage of the event, Michael Kitces said that treating financial advisors the same as clients “creates operational channel conflicts.”
And there’s the rub. If you’re an advisor using Betterment Institutional for your clients, when you authorize trades, you need to know whether those trades will be subject to Betterment’s suspension criteria.
But that’s one risk of using ETFs in Betterment Institutional, or any automated investment service for that matter. Sometimes the pricing gets out of whack, and you won’t always know in advance when that happens.
So on a volatile day, you need to understand that, as of today, your trade authorizations might not be processed right away, and your trades will be in limbo for who knows how long until Betterment decides it’s ok to resume trading. I suspect that policy might soon be changing for Betterment Institutional users.] Betterment, LLC, a pioneer in the world of automated investing, made an unusual move and suspended all trading Friday morning as markets were roiled by the U.K.’s vote to leave the European Union.
[My next story highlights TD Ameritrade Institutional, as I attended the custodian’s 7th annual technology summit in Dallas, and I made a vlog about it so you can get a glimpse of what the event is like, so be sure to check it out.
At the summit, executives offered updates on Veo Open Access, which now features 104 integrated solution providers, announced the introduction of Veo Advanced Alerts, and reiterated the pending release of the Veo One platform for late fall of this year.
There weren’t very many advisor dashboards available when Veo One was first announced in January of last year, but recently several tech providers have invested heavily in their own all-in-one dashboards, with notable names like Envestnet|Tamarac, supported by Envestnet’s acquisitions of Finance Logix and Yodlee, Salesforce, with its rollout of Financial Services Cloud happening now, and Fidelity’s Wealthscape platform anticipated by the end of this year, which will include technology from the eMoney acquisition.
So Veo One will go up against some stiff competition when it is rolled out later this year, so I recommend you make plans now to refresh what you know about the dashboard options for your business in the second half of this year.] A growing community of technology innovators, which has collaborated with TD Ameritrade Institutional1 to make Veo Open Access one of the industry’s leading platforms for independent registered investment advisors (“RIAs”), is again coming together to drive significant new enhancements to Veo and accelerate the pace of future Veo One integrations.
Here are the stories that didn’t make this week’s broadcast:
Junxure, the industry leading CRM solutions and technology company for financial advisors, this week announced new enhancements to its cloud-based CRM platform, Junxure Cloud®. As part of its ongoing work to integrate with leading platforms serving independent registered investment advisors (RIAs), Junxure Cloud has expanded its integration with Veo®, TD Ameritrade Institutional’s comprehensive trading and account management platform.
Vestorly Inc., the leading content marketing and relationship analytics platform in the financial services industry, today announced a unique partnership with Dow Jones that will enable all Vestorly users to access Dow Jones content, including The Wall Street Journal, in order to engage clients and generate leads.
Today, the company behind one of the more popular solutions for helping consumers manage their online accounts, Dashlane, is making its move into the enterprise.
Pershing LLC, a BNY Mellon company, today launched a suite of technology enhancements that provide wealth management firms with greater flexibility to digitally transform their business.
On the final day of the 2016 Morningstar Investment Conference, we wrapped up our vlog coverage with several discussions about things to implement as attendees return to their office.
We first attempted to capture sound bites on some of the best ideas heard at the conference, but this ended up unfolding in an unexpected way.
Next we connected with Blane Warrene and Marie Swift who have supported Morningstar’s social hub since it’s debut at the Morningstar Investment Conference five years ago.
We finished with varying perspectives from more key Morningstar employees, with one of them including, if you can believe it, a karaoke song about account aggregation.
I hope you enjoy the experience of day three of the 2016 Morningstar Investment Conference from our perspective.
Morningstar asked my executive producer Steve and me to attend their conference and create a daily vlog.
I hope you enjoy the experience of day two of the 2016 Morningstar Investment Conference from our perspective, including a new segment we attempted called “Escalator Interviews!”
On today’s broadcast, Personal Capital raises a new round of $75 million, SigFig raises its own round of $40 million, FINRA fines a rep for changing his CRM notes, and more!
Today’s episode is brought to you by RightCapital; innovative financial planning software with unique tax planning capabilities. RightCapital features detailed tax projection and retirement distribution modules that allow advisors to illustrate tax-efficient drawdown strategies and Roth IRA conversions.
[This week’s top story comes from Personal Capital, as the digital RIA firm recently raised 75 million dollars in Series E funding from one investor, IGM Financial, a Canadian-based financial services company. $50 million was invested immediately with the other $25 million to be invested next year, bringing Personal Capital’s total amount of money raised to $175 million.
What will the company do with the money? According to CEO Bill Harris, Personal Capital will double its advisor headcount from 100 to 200, and increase its development staff from 40 to 60. Funds will also be used to double the company’s marketing budget, as chief marketing officer Mark Goines was quoted as saying, “The sad truth is no one knows about Personal Capital,”
What I find most interesting about this round of fundraising is WHO made the investment. IGM Financial is an incumbent financial institution, not a venture capital firm, and I find it interesting that none of Personal Capital’s prior investors participated in this latest round. This begs the question: Why not?] Personal Capital, the leading digital wealth management firm, today announced IGM Financial Inc., a member of the Power Financial Corporation group of companies, has invested $50 million this week, with an agreement to invest another $25 million in the next year.
[Because in another related story this week, SigFig, a San Francisco-based online automated investment service, announced that the company raised $40 million dollars, which includes $7 million of debt funding, bringing its total raised just under $60 million.
Once again, who led SigFig’s latest round?
If you said an incumbent financial institution, give yourself a gold star, because Eaton Vance was the lead investor, and to the best of my knowledge, its participation marks the company’s first investment EVER in a startup company!
These incumbent players join a growing list of activity in this space, with BlackRock acquiring FutureAdvisor, Invesco acquiring Jemstep, John Hancock acquiring Guide Financial (remember them?). The list goes on!
So what does this all mean? The throng of automated investment services who set out to change the way investors invest, make investing simple, et cetera, are now cozying up with the incumbent financial institutions many of the startups set out to disrupt in the first place! And I didn’t even mention the SigFig partnership with UBS, did i?
Oh, and this week Wells Fargo said it too will announce its own robo advisor partnership by the end of June!] SigFig, an independent San Francisco-based wealth management technology company, today announced the raising of $40 million in financing from a number of leading financial institutions, including Eaton Vance, Comerica Bank, New York Life, Santander InnoVentures, and UBS, as well as top-tier venture capital firms Bain Capital Ventures, DCM Ventures, Nyca Partners, and Union Square Ventures.
[Now on to news about the CRM software you use. This week, InvestmentNews reported about an Ameriprise Financial Services representative who was fined $50,000 and suspended for one year by FINRA for backdating and editing client notes in his CRM.
The CRM in this case was ACT!, and the rep made changes in his notes related to the sale of a variable annuities, which were discovered only after an arbitration panel mandated a forensic examination of the rep’s computer.
So whether you use Redtail, Junxure, Wealthbox CRM, Salesforce, or any other solution, it’s critical that your firm be aware how the integrity of client notes, and all records for that matter, is preserved. If you don’t know, now might be a good time to conduct a quick audit.] The Financial Industry Regulatory Authority Inc. levied a $50,000 fine against an Ameriprise general securities representative who altered his software notes to document his recommendations, for a 78-year-old client, to invest $2 million in Ameriprise variable annuities, the regulator’s decision shows.
Here are stories that didn’t make this week’s broadcast:
When using technology, we often focus optimistically on all the things it does for us. But I want you to show you where it might do the opposite. Where does technology exploit our minds’ weaknesses?
Dashlane, the New York startup that provides a platform for users to manage their passwords and online identities across multiple sites and apps, has raised a further $22.5 million in funding and picked up a key strategic investor and partner in the process.
MaxMyInterest today launched significant enhancements to client onboarding, making it easier for financial advisors to offer Max’s intelligent cash management solution to their clients.
On today’s broadcast, I’m on location at the Envestnet Advisor Summit. You’ll hear from Bill Crager about Open ENV, Stuart DePina on adding Salesforce integration to Tamarac, and hear how the Yodlee acquisition is enhancing the Envestnet platform.
Envestnet, Inc. has unveiled Open ENV to offer differentiated user experiences, accelerate integrations and extend the availability of Envestnet’s solutions.
Envestnet | Tamarac has rolled out a new edition of its Advisor CRM® application, Advisor CRM, which incorporates the latest Microsoft Dynamics CRM 2016 update and is compatible with Microsoft Windows 10 and Microsoft Office 2016
For our final stop in Washington DC, we connected with Rich Ellinger, founder of Wealthminder, in the shadow of the Washington Monument on the National Mall. Hear how Ellinger is using his background in engineering and startup growth to make quality financial advice accessible to everyone.
CHAPTER MARKERS
0:10 FPPad Tech Tour Intro
0:41 Rich Ellinger introduction
2:35 What was the draw to found Wealthminder?
4:50 How do you balance your work outside of Wealthminder?
5:54 How can technology help make advisors better at what they do?
7:16 Describe the evolution of Wealthminder as more and more advisors use the solution
8:57 Support for the Foundation for Financial Planning
