LearnVest Archives

Learnvest to shut down accounts by June 5: Flash briefing for May 7, 2018

Posted on May 7, 2018 by Bill Winterberg in Flash Briefing, Technology

Here are the links to today’s top stories:

LearnVest to drop financial planning while ‘further integrating’ into Northwestern Mutual from Financial-Planning.com

Financial Engines Announces Agreement to Be Acquired by Hellman & Friedman for $45.00 Per Share in Cash from Businesswire.com

Alexa can remember birthdays and other things for you now from TechCrunch.com

Welcome to the FPPad fintech briefing, here are the top fintech stories you need to know today brought to you by Morningstar.

Register today for the 2018 Morningstar Investment Conference and see how they’ve helped lead the investing discussion for 30 years.

Learnvest to Shut Down Accounts by June 5

One of the larger acquisitions among financial planning startups in recent years is closing out with a whimper, as Learnvest told its customers that it will be shutting down its online investment tools next month, according to an email sent by the company and highlighted by Financial Planning Magazine. Back in 2015, Learnvest received substantial fanfare as Northwestern Mutual announced the acquisition of the online financial planning startup, and while terms of the deal were not disclosed, it was widely reported that the deal’s valuation was somewhere around $250 million.

Now three years later, Learnvest said it will turn off access to customer accounts on June 5 and plans to relaunch later this year as a “digital resource focused on educating consumers on how to meet their financial goals” according to a company statement. Some 8,000 customers will be affected, and may turn to other low-cost online financial planning services available from members of groups like the XY Planning Network or Garrett Planning Network.

Financial Engines to be Acquired for $3 Billion

In other acquisition news, Financial Engines, the nation’s largest independent investment adviser, announced it has agreed to be acquired by private equity firm Hellman & Friedman in an all-cash transaction valued at just over $3 billion. The transaction will merge Financial Engines’ $169 billion in assets with $21 billion in assets from Edelman Financial Services, which is another company in the Hellman & Friedman portfolio.

According to the Financial Engines statement, the combined companies will create the leading provider of scalable, comprehensive, and unbiased advice for all investors.

Alexa Adds “Remember This” Skill

And finally, did you forget your mother’s birthday or the last time you changed the filters in your HVAC? Well now there’s a skill for that, as Amazon rolled out a new skill for Alexa called “Remember This.” Simply ask Alexa to remember just about anything, including important dates, names, clothing sizes, you name it, and Alexa will remember the information and repeat it back to you when you ask in the future. I think this is a very slick feature, as you’re essentially building your own personal database of reference information that you can recall anytime in the future, all without any programming or writing a single line of code. You can’t do that with SQL!

For all the links to today’s top stories, be sure to visit FPPad.com/flashbriefing.

I’m Bill Winterberg, and those are your fintech headlines for today from FPPad.com. Check back in with me later for more fintech news.

What is Fidelity Access℠?

Posted on November 15, 2017 by Bill Winterberg in Technology

Fidelity Access℠ is an API-based account aggregation offering for Fidelity customers to grant permission to third-party financial websites and aggregation services and obtain account balances, holdings, and transaction information.

What is Fidelity Access℠ it and why it matters:

Fidelity Access℠ is a new API-based connection that enables third-party financial websites and account aggregation services to obtain information from Fidelity customer accounts, with the customer’s approval, without using customer login and password information in an attempt to “screen scrape” account information
Who’s onboard? Fidelity Access℠ is available now (November 2017), but no large account aggregation services (other than the obvious eMoney Advisor, a Fidelity company) as of yet have disclosed or announced their adoption of the Fidelity Access℠ API
Improved account security: Moving to API-based account aggregation reduces the number of times customers share their login credentials with third-party financial websites and aggregation services
Expect short-term frustration: Customers who leverage third-party financial websites will need to be patient as their providers transition away from using Fidelity login credentials to the new API. All providers must first meet Fidelity’s security and access requirements before connecting via the API. It’s quite possible that multiple aggregation providers and personal financial applications will not be approved by Fidelity to leverage Fidelity Access℠
What customers must do: All Fidelity customers will eventually have to manually enable account access to third-party financial websites using the Fidelity Access℠ dashboard when logged in to their Fidelity account
What financial advisers must do: Financial advisers who use data aggregated from clients’ Fidelity accounts will need to instruct clients to manually enable permissions through Fidelity Access℠ to the third-party aggregation services used by the financial adviser

Fidelity Investments announced the introduction of Fidelity Access℠, a new service that allows Fidelity customers to grant account access to third-party websites and aggregation services to obtain account balances, holdings, and transaction information using an API.

With Fidelity Access℠, Fidelity joins other financial institutions such as JPMorgan Chase, Bank of America, Wells Fargo (Gateway Channel) and others that have already introduced an API for third-party account aggregation as an alternative to “screen scraping” by logging in using a customer’s online account credentials.

Ending Online Credential Sharing

Historically, investors provided their financial account login credentials to popular aggregation and personal financial management apps like Intuit’s Mint.com, Personal Capital, Betterment, Wealthfront, Learnvest, Clarity Money, Quicken and more.

These services leveraged account aggregation functionality from providers such as Yodlee, Fiserv AllData, Finicity, Aqumulate, Plaid, Quovo, Wealth Access, and Morningstar ByAllAccounts to log in to financial accounts and obtain account balances and transaction data. (See How Intuit’s account aggregation shutdown may impact the fintech solutions you use)

One problem with sharing login credentials with third-party websites is the protection of the account login information and specifically the account password. Given the rapid increase in attacks on financial institutions, including the large security breach of Equifax affecting over 140 million customers in the U.S., hackers are obtaining passwords in record numbers for a variety of online logins that they then use in brute-force attacks to compromise online financial accounts. Many customers are at risk when they do not follow good online password hygiene by using the same password for multiple online accounts.

Cleaner Data

A few positives emerge from an API-driven connection like Fidelity Access℠. First, account authentication and data exchange is performed using well-defined protocols. Overall, security is enhanced as Fidelity Access℠ authentication is performed using the OAuth open standard.

Second, the quality of data obtained via API is much higher than “screen scraping” since the data is transmitted using conventional API functions. Such functions clearly identify datatypes being relayed over the API, so there’s no ambiguity over what pieces of data represent a security name, security symbol, transaction date, transaction amount, or total value of a holding.

Finally, institutions like Fidelity are able to reduce the bandwidth demands for websites customers use to log in to view account information, which were never intended to be accessed in high volumes by third-party aggregators.

Instead, institutions will now be able to shift the bandwidth required for account aggregation to separate services that support access over the API and reduce the demand on public website login page access.

Expect a Rough Transition

Sometime in 2018, Fidelity will no longer allow third-party account aggregation services to log in to customer accounts using shared online credentials and ultimately “break” the aggregation functionality.

At that time, Fidelity customers will need to manually enable account access via their own Fidelity Access℠ dashboard for each of the aggregation services they wish to continue to use.

The challenge here for customer satisfaction will be the rate of adoption among the dozens, if not hundreds, of third-party personal financial management apps into the Fidelity Access℠ program. It is possible that the transition will actually limit choice among customers as to which personal financial management apps can access Fidelity account information. Today, customers can enter their login credentials into any financial management app they wish to enable aggregation of Fidelity accounts without first obtaining Fidelity’s approval.

Also, many customers maintain relationships with multiple financial institutions for a variety of reasons, so as this trend of migrating to API-based aggregation plays out, customers will be required to manage account aggregation access not only for accounts they hold with Fidelity, but also with accounts at a variety of other financial institutions where the conduct business.

The common denominator for client satisfaction here is the aggregation provider that is able to quickly adopt as many of the institution-specific APIs as possible.

After all, what good is it to permission Fidelity Access℠ to the Personal Capital dashboard when Personal Capital is not approved to connect with other financial institution aggregation APIs? The incomplete aggregation decreases the value of the consolidated dashboard in services such as Personal Capital when it is not able to aggregate all of a user’s accounts.

Tepid Adoption

One other interesting take on the Fidelity Access℠ announcement is that none of the major aggregation providers were identified as adopting the new API (eMoney Advisor is, of course, onboard, which is expected as it is a Fidelity company). Other API introductions launched with at least one major aggregator on board, such as JP Morgan Chase and Intuit’s announcement in January 2017.

Eventually, adoption of Fidelity Access℠ will be very likely among the major aggregators, but I wonder what the thought process was behind the announcement of Fidelity Access℠ without also announcing which of the larger aggregation providers have already begun to leverage the API.

We’ll have to stay tuned for more updates here as the success of Fidelity Access℠ (and satisfaction of Fidelity customers) depends heavily on how widely adopted Fidelity Access℠ is among the major aggregation providers.

How Intuit’s account aggregation shutdown may impact the fintech solutions you use

Posted on March 24, 2016 by Bill Winterberg in Technology

Intuit’s Financial Data API looming shut down will have a ripple effect across popular account aggregation providers

Intuit’s looming Financial Data API shut down will have a ripple effect across popular account aggregation providers

Quick Take:

Intuit is discontinuing its Financial Data APIs widely used for financial institution account aggregation
Account aggregation providers using Intuit feeds (e.g. Blueleaf, Quovo, Wealth Access, Plaid and more) may need to transition to an alternate account aggregation provider
Intuit identified Finicity as a suitable account aggregation provider, but Finicity has issues around its business that raise concern for me
For advisors, your clients will have to reauthorize any accounts aggregated using the Intuit APIs as various companies phase out their use of the Intuit data feed

On March 15, 2016, Intuit announced they have decided to discontinue the Financial Data APIs (formerly CAD). No new direct Financial Data API (CAD) developers will be allowed to move into production.

The API will be maintained only for current production developers until November 15, 2016 to enable time for migration.

In the wake of Intuit’s decision, Guide Financial became the first adviser fintech provider to announce they are shutting down their service later this year. See Guide Financial to shut down operations on October 11.

Intuit identified Finicity as a solution that will provide a “façade” API interface that translates Intuit-structured API calls into Finicity-structured API calls.

Financial Data API Backstory

The Financial Data APIs from Intuit allow developers to link to end-users’ banking accounts from within their application.

In September of 2012, Intuit announced that it was opening up the technology that powered Intuit products like Mint.com, Quicken, and QuickBooks to the developer community via a library of APIs that it called Customer Account Data (CAD).

Customer Account Data, which was rebranded Financial Data APIs, is composed of two separate products: the Transactions API and the Identification API Beta.

The Transactions API offered connections to roughly 20,000 US and Canadian financial institutions, enabling third-party developers to quickly and cost-effectively deploy aggregation functionality to a wide array of financial sources.

The Identification API Beta facilitated customer’s identity and banking account verification using banking credentials. Developers were able to configure ACH connections via the API instead of relying on microdeposits (a series of deposits under $1 that the customer verifies) and a process called “fatfingering.”

FinTech Floodgates

The general availability of the Intuit Financial Data APIs opened the floodgates of all sorts of new B2C fintech startups that featured the aggregation of users’ financial accounts. These startups included popular names such as LearnVest, SaveUp, Hello Digit, BillGuard, and more.

A similar increase has taken place among B2B account aggregation providers, with companies like Blueleaf, Wealth Access, Quovo, Plaid, and Right Capital all appearing with some type of advisor aggregation fintech solution over the last four years.

Prior to the new wave of account aggregation providers, advisor solutions were dominated by four key players:

Yodlee, acquired by Envestnet, completed in November 2015 for $538 million
Cash Edge, acquired by Fiserv in June 2011 for $465 million and available to advisors through partnerships such as Aqumulate
ByAllAccounts, acquired by Morningstar in April 2014 for $28 million
eMoney Advisor, acquired by Fidelity in February 2015 for a reported $250 million

Intuit Gave, Intuit Hath Taken Away

So now that Intuit is going to shut down access to its APIs, several fintech aggregators should find themselves scrambling for a suitable replacement before November.

Based on my research, many companies I mentioned earlier are going to have to fill the gap left by Intuit’s hole in the marketplace. They include:

Guide Financial (which will shut down later this year, see Guide Financial to shut down operations on October 11)
Blueleaf
Wealth Access
Quovo
Plaid
Betterment (retail and Institutional, based on their use of both Plaid and Quovo)

Note: Prior to August 30, 2016, I had Right Capital in the list above. After connecting the Right Capital co-founder Shuang Chen, I learned the company had considered Intuit’s API for aggregation at one time, but ultimately decided to engage Yodlee for account aggregation. Therefore, Right Capital will not be affected by the Intuit API shutdown.

In its press release, Intuit identified Finicity as an alternate provider of aggregation services.

We have identified a new aggregation partner, Finicity, for whom this service is a core part of their business. Finicity can offer long-term benefits and service for our aggregation customers. To minimize developers’ engineering work to switch APIs, Finicity will provide a façade API interface that translates Intuit-structured API calls into Finicity-structured API calls.

The “façade API interface” means that developers with existing code that calls on Intuit APIs will not need to change their codebase. Instead, Finicity will publish an API interface that is 100% compatible with existing calls to the legacy Intuit APIs and return data to the developer’s application as if Intuit’s APIs never went away.

Who is Finicity?

For me, Finicity is a newer name in aggregation that came to my attention last year while monitoring Quora for details on Yodlee despite founding the business in September 2000.

While the Finicity compatibility endorsed by Intuit sounds good for existing developers, there are certainly other issues to consider before building a business on top of Finicity services, and that absolutely should factor into the due diligence process of advisors.

Finicity has a relatively unremarkable profile in CrunchBase, but a few more details about adoption and marketshare come from Finicity co-founder Nicholas Thomas from this Quora question:

2015 has been a good year for Finicity. We’ve signed hundreds of Fintech and Financial Institutions to build their solutions on our API, have quietly launched over a dozen partners, and are launching dozens more in 2016. Our partners tell us that our broad native data source coverage and our fanatical agg support teams are the primary reasons why they love us.

-Nicholas Thomas

So with relatively little marketing (e.g. as I published this, their most recent tweet was on October 27, 2015), Finicity managed to sign up “hundreds” of customers, launched “over a dozen” partners, with more on tap in 2016.

Is account aggregation Finicity’s only play in the industry? No.

To see what other lines of business Finicity offers in addition to their aggregation services, their website lists two other divisions: Mvelopes and Money 4 Life Coaching

Mvelopes from Finicity

Mvelopes is a software application for personal budgeting and has extremely high ratings for its apps in the app stores. Surprisingly high, actually (more on this later).

Mvelopes allows users to create virtual envelopes for different spending categories and allocate money to them accordingly. The idea is that throughout the month, users refer to the amount of money left over in each envelope after paying bills in order to preventing overspending. Transactions are aggregated from connected accounts, and transactions are automatically deducted from applicable virtual envelopes of available cash.

The service is free to use with a limit of four aggregated cash flow and credit accounts (here’s the Finicity aggregation connection). To access unlimited accounts, users subscribe to the Mvelopes Premier plan for $95/year.

Money 4 Life™ Coaching

Where things get more controversial for me is Finicity’s division called Money 4 Life™ Coaching. The Mvelopes pricing page makes the first mention of coaching services and describes how customers can benefit from one-on-one coaching customized for individual needs.

Finicity coaching snapshot

So I looked into this coaching services with a quick Google search and came across quite a few consumer complaints (36 to be exact) about the services on the Better Business Bureau website.

Most of the complaints seem to be centered around the Money4Life coaching including allegations of no contact by coaches for months at a time and allegations of cancellation difficulties.

Most complaints listed on the BBB site appear to reach a satisfactory conclusion once customers initiate the dispute process (which results in an overall BBB rating for Finicity of A+) , but it is surprising that many customers feel that they need to involve BBB in the first place in order to reach a resolution.

Also, the Mvelopes mobile app ratings are overwhelmingly positive, but many of the five-star reviews have no details in the description or come from users with no other app reviews other than Mvelopes. It’s eyebrow raising.

Critical Mvelopes app reviews such as the one below from iTunes are enlightening:

mvelopes app review

I contacted Finicity for comments and have not yet heard back from the company, so I will update this post accordingly.

What’s Next?

So what’s next? Given Finicity’s connection to awkward customer experiences under the Money4Life coaching program, how likely are the younger aggregation providers to migrate their API calls to the Finicity API? Or will there be a trend to simply abandon the aggregation of financial institutions currently covered by Intuit?

No matter what, as the aggregation vendors make their decisions behind the scenes, advisors’ clients will need to reauthenticate their usernames and passwords once a migration to a new aggregation service is implemented.

For some firms that have a handful of aggregation accounts, this may be a non event, but for larger firms with thousands of aggregated accounts, the issue could take weeks or months to resolve as all clients work through their accounts to reauthenticate their login credentials.

FPPad Bits and Bytes for January 15

Posted on January 15, 2016 by Bill Winterberg in Bits & Bytes

On today’s broadcast, Jemstep gets acquired by Invesco, rumors fly about a Snapchat robo advisor, FutureAdvisor links up with its first bank, and more.

So get ready, FPPad Bits and Bytes begins now!

(WatchFPPad Bits and Bytes on YouTube)

Invesco acquires Jemstep, a market-leading provider of advisor-focused digital solutions from PRNewswire

[This week’s top story comes from Jemstep, as the B2B online investment platform was acquired by Invesco, the $800 billion dollar asset manager based a stone’s throw away from my studio right here in Atlanta.

Terms of the deal were not disclosed, Jemstep’s leadership will stay onboard to run the Invesco subsidiary, and for now, the company says there won’t be any changes to existing partnerships, custodians, or asset availability in model portfolios.

Ignoring B2C acquisitions of FutureAdvisor and LearnVest, the last twelve months have seen John Hancock acquire Guide Financial and Envestnet acquire Upside.

So who are the independent B2B providers left? I see Autopilot, Trizic, Oranj, Vanare, Betterment Institutional, Motif Investing, and to some extent, the roll-your-own open source platform from Wealthbot.] Invesco Ltd. has acquired Jemstep, a market-leading provider of advisor-focused digital solutions.

Social media firms make ETF push from Reuters

[But hold on! Sending shockwaves in the retail robo space is Snapchat, as rumors were flying this week that the ephemeral chat app might introduce it’s own investment service to its 100 million active daily users.

Uh, let me explain my thoughts in a brief demonstration… Get it, jump the shark?] Snapchat is understood to be at the front of a queue of tech firms developing Robo-Advisory technology – which uses algorithms to help users develop and implement customized investment strategies for retirement planning.

BBVA Compass Teams Up With Robo FutureAdvisor from Forbes

[But wait, there’s more! In its first move after being acquired by BlackRock, FutureAdvisor announced it is partnering with BBVA Compass to roll out the automated investment tools to the bank’s nearly 700 branches in the US.

Bank customers will get access to FutureAdvisors’ digital investment management for the standard fee of 50 basis points, and you can probably bet that new accounts opened up with be held with BBVA’s broker-dealer affiliate, which is how the bank capitalizes on the partnership.] BBVA Compass, the Sunbelt subsidiary of the Spanish banking giant, has announced it will partner with FutureAdvisor to offer its customers digital investment management, popularly known as Robo Advisors. It is the first major bank to sign on with FutureAdvisor since the advisory firm combined forces with BlackRock, the giant asset management company, last year.

Robo Adviser Wealthfront Begins to Offer Free Portfolio Reviews from WSJ.com

[And if you’re not sick of robos by now, let me add news from Wealthfront who this week released a free Portfolio Review service to show investors how bad their current portfolios are and urge them to save a boat load of money by switching to Wealthfront. Whoops, did I say that out loud?

This concept is nothing new, as Personal Capital has offered a similar portfolio analyzer since 2011, and FeeX has been doing it since 2012, but here’s the deal. These VC-backed companies are spending tons of money to target your clients and prospects to get them to try out this tool, and of course, they’re going to tell clients they have suboptimal allocations and are paying high fees to their advisor.

So, expect clients to bring up fees, allocations, and performance in your next meeting, and you need to have a strong answer in the form of your value proposition, which is all the added advice, guidance, and behavior management you deliver that the automated services are incapable of providing.] In a bid to attract more assets, Wealthfront Inc. is joining other robo advisers in providing free advice to investors about their accounts at other financial institutions.

Here are stories that didn’t make this week’s broadcast:

New Laserfiche Release Aims to Improve ECM from CMSWire

Laserfiche just released version 10 of its enterprise content management system (ECM). Speaking at the Laserfiche Empower 2016 Conference in Long Beach, Calif., Laserfiche President Karl Chan said the new version is designed to supercharge content-driven business processes, enabling enterprises to redesign the flow of information throughout the enterprise.

LastPass Revamps Its Interface, Adds Emergency Access and Better Sharing from Lifehacker

LastPass is one of the best password managers around. Today it gets a bit better with an improved interface and a handful of new features.

Dashlane 4 Makes Changing Passwords on Hacked Sites Easier, Adds a New Interface, and More from Lifehacker

Dashlane is one of our favorite password managers, and today the service updated with a new, consistent interface across all devices, an updated “password changer” that lets you change passwords on a site without even visiting it, new languages, and more.

Watch FPPad Bits and Bytes for January 15, 2016

FPPad Bits and Bytes for June 5

Posted on June 5, 2015 by Bill Winterberg in Bits & Bytes

On today’s broadcast, Guide Financial gets scooped up by an insurance company, Fox Financial Planning Network wants to help you with your online investment service adoption, and WealthMinder raises fresh capital to give you an edge over robo advisors.

So get ready, FPPad Bits and Bytes begins now!

(WatchFPPad Bits and Bytes on YouTube)

This week’s episode of Bits and Bytes is brought to you by Total Rebalance Expert, the industry’s largest, privately owned portfolio rebalancing software provider.

TRX now offers TRX Edge, a completely rewritten rebalancing platform optimized for the web as well as mobile devices. Sign up for a demo of TRX Edge by visiting http://fppad.com/trx

Here are the links to this week’s top stories:

John Hancock Acquires Software Provider Guide Financial, Inc. As Part of Companywide Long-Term Innovation Plan from John Hancock

[This week’s top story comes from Guide Financial, because while I was enjoying clam chowder in a Boudin sourdough bowl in San Francisco, the company announced it was acquired by John Hancock, the life insurance, mutual fund, and retirement solution provider. Terms of the deal were not disclosed.

Now if you’re a regular viewer of FPPad Bits and Bytes, you should remember I highlighted Guide Financial in episode 124 when the company announced an agreement to white-label its solution for members of the Garrett Planning Network.

That was more than a year ago, and I’m told that the adoption of the white-labeled solution was below expectations. So fast forward to today on the heels of fintech acquisitions of eMoney Advisor, Upside, NestEgg Wealth, and LearnVest and you’ll quickly realize that industry behemoths like John Hancock are eager to cater to tech-savvy customers with slick, user friendly online experiences. Guide Financial is just one of the many online startups in this space building such a platform.

In the press release, John Hancock said that Guide Financial will operate as an independent group, so I can only speculate whether or not Guide Financial will remain independent or if some financial product upselling and/or cross marketing will weave its way into the solution. So stay tuned.] John Hancock announced today that it has acquired Guide Financial, Inc., a San Francisco-based software provider for financial advisors. Guide Financial builds software that enables investors to make better financial decisions and build wealth, utilizing artificial intelligence, behavioral finance, and seamless advisor integration. Terms were not disclosed.

Fox Financial Planning Network Launches AdvisorTouch Symphony from PRNewswire

[Next up is more news regarding online investment services, as the Fox Financial Planning Network recently announced a new program called AdvisorTouch Symphony. If you missed the news because you were out riding a cable car, AdvisorTouch Symphony is essentially a turnkey roadmap you can implement to add an online investment service to your business.

Under the program, you’ll receive step-by-step guidance on how to adopt these new tools, with Jemstep Advisor Pro being the first automated investment service of choice, and you can expect several other online services to be featured in the near future.

Pricing for firms with one to three advisors is a one-time fee of $5,500, and larger firms will be charged based on their size and need for customization.

This gets you the practice management resources, but this fee doesn’t include additional compliance guidance and resources available from National Regulatory Services, or the optional cybersecurity consulting from True North Networks which were both named in an alliance with AdvisorTouch Symphony. Whew! Got that?

So if you want someone else to show you how to add an online investment service to your business, this is one resource to be sure is on your radar.] Fox Financial Planning Network (FFPN) announced today the launch of AdvisorTouch Symphony, the only program of its kind to help financial advisory firms harness the power of combining robo-technology with practice management. FFPN created this program to demystify robo-technology for advisory firms and provide a detailed road map through every aspect of the implementation process to help firms maximize the benefits of its use.

This Reston startup raised $1.45M to bring financial advisers to the masses from BizJournals.com, and

Beyond the Robo-Advisor from Financial Advisor Magazine

[And finally, this week’s broadcast wraps up with news on WealthMinder, because while I was pillaging and plundering with pirates of the “you can’t say that on YouTube,” the company announced a new round of fundraising to the swashbuckling tune of $1.45 million.

WealthMinder is, surprise surprise, yet another while-labeled advisor solution for online service, only this one goes beyond basic asset allocation recommendations by incorporating goal planning. To get a deeper look at WealthMinder, coincidentally, Joel Bruckenstein reviewed WealthMinder in his column for Financial Advisor Magazine this month.

To cut to the chase, clients and prospects log in to WealthMinder and choose goals they’re planning for, they aggregate their investment accounts using an integration from Yodlee, and WealthMinder ultimately generates an initial financial plan based on some basic assumptions, and yes, the plan can include investment recommendations, too.

For you, the advisor, you can log in to your dashboard and view all the plans that clients have created, which includes their recommended actions, and then you can proactively offer your services to help clients implement the next steps. There are a reported 26 firms using the platform today, and the pricing to advisors comes in at $10 per month per client, but you can offset the cost by collecting a monthly subscription fee from clients who want to use the WealthMinder platform.] WealthMinder, a Reston-based financial marketplace that looks to connect financial advisers with people who aren’t considered wealthy, has secured $1.45 million in seed funding led by two West Coast venture capital firms — Green Visor Capital and Signatures Capital.

Here are the stories that didn’t make this week’s broadcast:

Morningstar to Add Portfolio Rebalancing Capability for Independent Financial Advisors, Powered by Total Rebalance Expert from Morningstar

Morningstar, Inc., a leading provider of independent investment research, is working with Total Rebalance Expert (TRX) to add rebalancing functionality to Morningstar Office, the company’s practice and portfolio management system for independent financial advisors.

Vestorly Announces the Integration of Its Smart Digital Content Technology on to Pershings NetX360® Platform from Marketwired

Vestorly today announced the integration of its smart digital content technology into Pershing’s NetX360® platform.

Tech Review: New Bet on Financial Health from Financial Planning

Consumers seem to be buying into the idea that these devices can help improve their physical health, so why not create similar mobile capabilities to track financial health?

Watch FPPad Bits and Bytes for June 5, 2015

FPPad Bits and Bytes for March 27

Posted on March 27, 2015 by Bill Winterberg in Bits & Bytes

On today’s broadcast, Schwab reveals details about its Institutional Intelligent Portfolios™ platform for advisors, LearnVest gets acquired by Northwestern Mutual, and Periscope becomes the latest trendy app for live video streaming.

So get ready, FPPad Bits and Bytes begins now!

(Watch FPPad Bits and Bytes on YouTube)

Today’s episode is brought to you by Total Rebalance Expert, the industry’s leading tax efficient and multi-custodial rebalancing platform – now available anytime, anywhere on any device with TRX Edge.

Here are the links to this week’s top stories:

Technology details of Institutional Intelligent Portfolios™ from Schwab Advisor Services from FPPad, and

Charles Schwab Unveils Institutional Intelligent Portfolios Details from BusinessWire

[There were two big stories this week you need to know about, so let’s begin with Schwab Advisor Services, as the company announced details of its Institutional Intelligent Portfolios™ solution created for you, the financial advisor, that will be released in the second quarter of this year.

Institutional Intelligent Portfolios is an automated investment management solution that allows you to add your firm name, logo, and contact information to the platform as well as design your own portfolios, provided that you choose from a pool of about 200 ETFs.

Now if you custody over $100 million dollars with Schwab, there’s no platform fee, but if you custody under $100 million, Schwab will charge users a platform fee of 10 basis points. And no matter what, you can’t allocate less than 4% in cash for any of your custom portfolios.

So what does this mean for your business? You now have yet another technology solution to offer a low-cost automated investment service to emerging clients, but IIP has the potential to be “free” if you custody enough assets with Schwab AND you ignore the drag on returns due to the 4% minimum cash requirement. But for that rock bottom price, you’re giving up some control.

If Schwab decides to change the available ETF options, or decides to require a higher minimum cash allocation, well, it’s their way or the highway. And don’t forget, this is not a set and forget business model.
These are people that we’re talking about signing up for automated services; they’re more than just users. Your business may already be spread thin today, and unless you’re thoughtful about a new strategy for serving this market, you may not be setting yourself up for success.

So will you be adding IIP and its ETFs to your RIA ASAP for your VIPs, or will you be SOL and suffer from FOMO? Hashtag LOL.] In company webcast and press release today, Schwab Advisor Services provided details of its Institutional Intelligent Portfolios™ solution that the company describes as an “automated investment management solution for independent registered investment advisors (RIAs).”

Northwestern Mutual Life Insurance Co. to acquire LearnVest from FPPad

[Next up is the surprising announcement this week that LearnVest, the New-York based financial planning startup, has agreed to be acquired by Northwestern Mutual, the largest direct provider of individual life insurance, AND one of the top 10 biggest independent broker-dealers in the financial planning industry.

Terms of the deal were not disclosed, and rumors have been flying in every direction about valuation, revenue, burn rates and more.

Now a lot of times LearnVest has been mischaracterized as another robo advisor, but the company actually employs over 40 full-time financial planners, and they built their own proprietary financial planning software and tools because existing solutions were too complex and time consuming to use.

So while financial planning has been the big focus of LearnVest, I don’t think that was a big factor in this deal at all.

According to CEO John Schlifske, Northwestern Mutual advisers created over 400,000 financial plans last year. If you take LearnVest’s number of clients in their February 2015 Form ADV Part 2, at best they delivered 3,700 plans in the last fiscal year, not even 1% of the Northwestern Mutual’s volume.

For me, this deal is all about lead generation. By acquiring LearnVest, Northwesten Mutual now gets access to the over 1.5 million people who use LearnVest’s free mobile app or subscribe to LearnVest’s content. Schlifske was quoted saying that LearnVest “is expected to continue providing unbiased planning,” so assuming that’s true, what’s the upside for Northwestern Mutual?

How does one bring together “best-in-class products” with a “cutting-edge client digital experience,” without an inherent conflict? The jury’s still out on this one, so be sure to watch future broadcasts as this story develops.] According to the Wall St. Journal, Northwestern Mutual Life Insurance Co., said it would acquire New York-based online financial planning startup LearnVest Inc.

Here are the stories that didn’t make this week’s broadcast:

Twitter’s Periscope App Lets You Livestream Your World from Wired

Periscope is consensual voyeurism. That’s not a new idea—millions use Twitch to watch other people play videogames, while YouTube, UStream, and a dozen others have tried to make businesses out of live-streaming video—but it feels like the right platform and the right time.

Tax-Loss Harvesting for Everyone from Wealthfront

We’re proud to announce that our daily tax-loss harvesting service will be made available to all Wealthfront taxable accounts, starting in April.

Watch FPPad Bits and Bytes for March 27, 2015

Northwestern Mutual Life Insurance Co. to acquire LearnVest

Posted on March 25, 2015 by Bill Winterberg in Technology

Northwestern Mutual to acquire online financial planning provider LearnVest

(This is a developing story)

According to the Wall St. Journal, Northwestern Mutual Life Insurance Co., said it would acquire New York-based online financial planning startup LearnVest Inc.

Terms of the deal were not disclosed.

Here’s your Too Long;Didn’t Read (TL;DR) summary:

At the time of acquisition, LearnVest had 10,000 premium clients who pay a one-time setup fee of $299 and $19/month ongoing. That’s at best $2.28 million in annual revenue plus $2.99 million in non-recurring one time setup fees.
LearnVest received $69 million of funding in five rounds from 15 investors (via Crunchbase)
LearnVest for Work, a “corporate financial wellness program” had another 25,000 clients. Employers paid or subsidized access to LearnVest planners for employees.
LearnVest employs 150 planners in New York and Arizona. Assume an “average” salary of $60,000 and you have an annual burn rate of $9 million (hat tip @MichaelKitces).
For now, LearnVest employees will not become advisers for agents of Northwestern Mutual

@FeeOnlyIndy 150 employees at @LearnVest is a helluva burn rate. "Just" $60k salary average is $9M/year? @BillWinterberg

— MichaelKitces (@MichaelKitces) March 25, 2015

More reactions to the potential for conflict between LearnVest’s financial planning advice delivery and LearnVest’s ownership by a retirement plan and insurance provider are in this InvestmentNews article by Darla Mercado.

FPPad Bits and Bytes for December 12

Posted on December 12, 2014 by Bill Winterberg in Bits & Bytes

On today’s broadcast, Financial Planning magazine’s annual tech survey is here. Find out who makes up this year’s winners and losers in advisor technology. Fidelity announces a new collaboration with LearnVest. How will this partnership help you with your digital advice delivery to clients? And, Wealthfront fires the first salvo at the separately managed account industry. Does this new service have the potential to put pricing pressure on the SMAs you use today?

So get ready, FPPad Bits and Bytes begins now.

(Click to watch on YouTube)

Today’s episode is brought to you by the 2015 T3 Conference, Advisor Edition, exclusively designed for the technology needs of independent financial advisors.

You can get $50 off the regular registration rate by using the promo code “2015T3FPPAD,” so reserve your spot to the event Michael Kitces calls the Best for Advisor Technology by visiting technologytoolsfortoday.com

Now here are the links to this week’s top stories:

Tech Survey 2015: What’s New Now? from Financial Planning

[This week’s top story comes from Financial Planning magazine, as technology columnist Joel Bruckenstein revealed the results of the publication’s annual technology survey of financial professionals. The first surprise of the survey involves tools advisors use to assess client risk tolerance.

For the longest time, the risk assessment category has been dominated by FinaMetrica, the Australian-based firm that launched its client profiling tools back in 1998. Today, assessment tools from Riskalyze and PocketRisk have gained respectable adoption among advisors. But roughly 50% of survey respondents admitted that they don’t use any risk profiling tools, so if you’re part of that 50%, you might want to consider adding one of these solutions to your technology plan for 2015.

Also gaining traction are portfolio rebalancing solutions, as these tools are now in use by more than half of all survey respondents, a first for the category. TD Ameritrade Institutional’s iRebal earned top honors, with Envestnet|Tamarac and Orion Advisor Services rounding out the top three solutions in use today. And with all of the low-cost online investment solutions touting their rebalancing and tax-loss harvesting attributes, I expect to see rebalancing software adoption to continue to grow as advisors match the rebalancing capabilities of the online providers.

Other than that, this year’s survey is pretty similar to the one from 2013, with TD Ameritrade Institutional taking top honors in advisor satisfaction, MoneyGuide Pro cited as the most popular financial planning software, and Junxure, Salesforce, and Redtail duking it out once again for top honors among CRM software depending on how you slice the data.] In the advisor technology sphere, it used to be enough to look for evidence of change. What’s different now is the velocity of the action.

Fidelity Institutional Announces New Collaboration with LearnVest from Fidelity Institutional

[Speaking of online investment solutions, the next story comes from Fidelity Institutional, as the company recently announced a new collaboration with LearnVest, the online technology-enabled financial planning provider. This news follows Fidelity’s announcement last month of a similar collaboration with Betterment Institutional, where Fidelity will list the online investment service in its list of resources advisors should consider as they contemplate ways to attract the next generation of investors.

Under the collaboration, advisors can publish what’s called a “financial wellness” micro website that features educational content produced by LearnVest. In addition, advisors can offer the LearnVest planning program to their clients under a preferred pricing agreement.

Now I’m all in favor of advisors embracing digital advice delivery at an affordable price, buy why should you be piggybacking off of LearnVest’s content? Shouldn’t YOU be the one delivering valuable financial planning content to your clients and prospects? If you have the resources, you should be building your own website, creating your own content, and training yourself and your colleagues to deliver your message with compelling video content. Yes, it takes time and a nominal financial investment, but I bevel the potential reward is worth it.

However, if you don’t have the talent or the resources to make this happen, then the LearnVest collaboration at least gives you a starting point to bridge the gap between your current service model and the technology-enabled relationships that emerging clients are demanding.] Fidelity Institutional, the division of Fidelity Investments® that provides clearing, custody and investment management products to registered investment advisors (RIAs), retirement recordkeepers, broker-dealers, family offices and banks, today announced a new collaboration with LearnVestTM, as well as additional resources to help advisors explore options to digitize their practices.

Direct Indexing: The Next Generation of Index Investing from Wealthfront

[And finally, it seems like I can’t stop talking about online investment services this week, as this time it’s Wealthfront making headlines, as the company just announced a new offering called Direct Index investing. Starting with an account minimum of $100,000, Wealthfront will purchase individual securities and ETFs on behalf of its customers that are benchmarked against the Vanguard Total Stock Market ETF. Holding individual securities instead of funds and ETFs allows Wealthfront to track the performance of the index, but harvest individual gains and losses from individual in securities to be more tax efficient.

If this sounds a lot like separately managed accounts, or SMAs, that advisors use today, that’s because it is. So while Direct Index Investing isn’t anything new, Wealthfront is now able to offer the service with very low account minimums and charges its low annual management fee of just 25 basis points, which could very well put pricing pressure on many of the SMA providers you use like Parametric, Envestnet, Nuveen, and more.] Today, we are very excited to announce the expansion and improvement of our unique direct indexing technology. With this release, the Wealthfront Direct Indexing Platform will extend the benefits of direct indexing to broader sets of clients, with increased tax benefits and lower costs.

Here are the stories that didn’t make this week’s broadcast:

Junxure Expands Relationship and CRM Integration with Advent Software

Junxure CRM, an industry-leading practice improvement firm for financial advisors that integrates CRM technology, consulting, and training, today announced the expansion of its relationship with Advent Software, a leading provider of software and services for the global investment management industry. Advent’s Black Diamond(SM) wealth management platform now offers an integrated experience with Junxure Cloud, Junxure’s cloud-based CRM/office management solution.

Watch FPPad Bits and Bytes for December 12, 2014

FPPad Bits and Bytes for October 10

Posted on October 10, 2014 by Bill Winterberg in Bits & Bytes

On today’s broadcast, Schwab and Google drop hints about their online investment services. See how this crowded market is about to become a little bit more cozy. Digital estate planning for your clients is becoming more important than ever. Find out which new solution will help your clients plan for their digital assets. And, Bob Veres gets me fired up about the use of social media in your business. You’ve been warned, prepare for a storm off!

So get ready, FPPad Bits and Bytes begins now.

(Watch FPPad Bits and Bytes on YouTube)

Today’s episode is brought to you by Envestnet | Tamarac, the provider of Tamarac Advisor Xi, a web-based portfolio and client management platform that uniquely integrates portfolio management, reporting, monitoring, rebalancing, and trading with a client portal and enterprise level CRM.

Find out more about Advisor Xi and download their latest white paper on best practices for technology evaluation and implementation by visiting fppad.com/tamarac

Here are the links to this week’s top stories:

Exclusive: Schwab ready to unveil free ‘robo-broker’ service from Reuters, and

Google study heightens fund industry peers from Financial Times (subscription required) or Google Looks to Enter Financial Industry from NBC Bay Area, or Google will likely re-invent the industry rather than play in the existing sandbox from Valuewalk

[This week’s top story covers *two more* announcements in the online investment algorithm space. You did watch last week’s episode, didn’t you? So first up is Charles Schwab who, according to a Reuters article, is developing its own automated investing service for use by you, the financial advisor, to attract emerging clients with a low-cost solution. How low cost you ask? Rumors indicate the service will be free, not including the four to 19 basis points charged by Schwab’s ETFs used in the platform.

And on the heels of Schwab’s news, Google hinted that the company is exploring its own entry into the investment management business. Financial Times first reported that Google commissioned a research report back in September on entering the asset management industry, which trigged a wave of industry speculation that gained a lot of momentum this week.

So let’s take a step back for a moment. Schwab has over 7 million investor accounts with over $1trillion in assets under management and Google has over one billion users across their various online services and mobile devices.

Collectively, the online investment providers have somewhere around $3 billion in assets under management (that’s 3 tenths of a percent of Schwab!) and less than 100,000 users (that’s one one-hundredth of a percent of Google!). Are the disruptors about to be disrupted? I don’t know, you tell me, and it all depends on whom you ask.] Charles Schwab Corp. is weeks away from introducing an automated investing service aimed at winning business from novice investors it does not currently serve, company officials told Reuters.

Estate Assist Wants To Provide Estate Planning For The Social Media Age from TechCrunch

[Next up is an announcement of a new service called Estate Assist, an online safe deposit box, if you will, that stores information about digital assets and shares that information with trusted recipients after a user passes away.

Identifying and managing your clients’ digital assets is probably not a part of your current service model, partly because there really haven’t been any decent solutions out there you can use that are better than using plain old spreadsheets. But with the introduction of Estate Assist, I think it’s time you consider including digital asset management services. Look at my YouTube channel or my email newsletter as an example: if I got hit by a bus <pause>, how will my spouse and beneficiaries access these assets?

In addition to Estate Assist, I think you should look into similar services from PrincipledHeart.com, created by CFP® practitioner William Bisset, as well the data inheritance feature from SecureSafe.] Estate Assist, launches out of beta today. Its aim is to help you store all your online passwords, social media accounts, digital health records, bank info and other paperwork.

The Five Biggest Ways Your Practice Needs to Change from Advisor Perspectives

[And finally, this week’s episode wraps up with industry commentary from Bob Veres, as he identifies the biggest ways your business needs to change in a recent Advisor Perspectives column. Now Veres says “pundits and journalists” say you need to make radical transformations, but they don’t give you any specifics. I hope he’s not talking about me, because I try to load these broadcasts you’re watching with tons of resources you should have on your radar. But I digress.

Veres mentions a number of what he calls “genuine evolutionary trends” which are all enlightening in their own way, but buried down at the bottom of his column, he says he suspects that “social media is going to be the least productive in terms of generating business for your firm.”

Really? Now to his credit, Veres says you should play to your strengths, and if social media isn’t one of them, it’s ok.

Well, I think that attitude was valid 20 years ago before it was possible to find out just about anything about anyone online using a quick Google search.

Just look at this broadcast. Complete strangers are watching it, they’re getting consistent value from it, and if they meet me in person at a conference, they say they feel like they already know me. So to say it’s the “least productive” way to generate business.. that’s it, I’m done.] Pundits and journalists make their living telling you that our profession is in a period of rapid evolutionary transition, and exhort you to be open to radical transformation. What you don’t hear in these messages are the specifics.

Here are the stories that didn’t make this week’s broadcast:

Watch all of the videos from Finovate Fall 2014 presentations

Mobile Dossier Startup Refresh Finds A Revenue Model With Its Salesforce App from TechCrunch

Refresh, the mobile tool for making you smarter at meetings, is now positioning itself to help sales teams be smarter about their clients and potential clients. To do that, the company has created a new product for Salesforce’s AppExchange that will allow users to access detailed information about the people in their professional network.

Watch FPPad Bits and Bytes for October 10, 2014

FPPad Bits and Bytes for October 3

Posted on October 3, 2014 by Bill Winterberg in Bits & Bytes

On today’s broadcast, Upside Advisor teams up with a high-profile RIA. Will this partnership do anything to slow the growth of the $(!#-advisers? Redtail CRM previews the new version of its popular CRM. Will the design and feature changes be enough to attract advisors that are using aging systems? And, broker-dealers aren’t turning a blind eye to technology. Find out which firms are investing heavily to boost the efficiency of their representatives.

So get ready, FPPad Bits and Bytes begins now!

(Watch FPPad Bits and Bytes on YouTube)

Today’s episode is brought to you by Wealthbox CRM. Version 1.6 is now available featuring automated workflows, templates for routine processes, and progress updates all on one screen!

Here are the links to this week’s top stories:

Upside Powers Ritholtz Wealth Management’s New Digital Offering, Called Liftoff from Upside Advisor

[First up this week is an announcement from Ritholtz Wealth Management, the New York RIA headed by The Big Picture blogger Barry Ritholtz and Josh Brown, aka The Reformed Broker, who released a new web-based offering to emerging clients called Liftoff. Liftoff is a white-labeled version of the $(!#-adviser solution, uh, ok, online investment solution from Upside Advisor, which I introduced to you back in episode 136.

For around 40 basis points, Liftoff provides automated asset allocation recommendations to clients who want to get started with investing, but don’t yet have enough assets to qualify for a one-on-one relationship with Ritholtz’s advisors. Upside Advisor is just the latest $(!#-adviser, oh, right, online investment provider to join this space, as they’re going up against competing solutions like Wealthfront, Personal Capital, Betterment, Learnvest, Guide Financial, JemStep, Orion Discover; I can’t keep them all straight!

So today you’re faced with a choice: will you sit on the sidelines to see how these low-cost automated solutions play out, or will you partner with a low-cost provider to offer an investment solution for your emerging clients?] Upside, a technology company providing a digital advisor platform to investment advisors, today announced a new partnership with Ritholtz Wealth Management (RWM).

Tech Review: Redtail’s New Edition from Financial Planning

[Next up is a review of Redtail CRM and its third major product update to its software called Project Tailwag. In his October column for Financial Planning magazine, Joel Bruckenstein gives a very favorable review of the redesign and feature enhancements to the industry’s most widely used CRM.

Users will soon have access to a clean, flat design that’s easier to use, and it’s also responsive, as it adjusts to screens of any size from desktops to smartphones. Contact records feature a timeline of client interactions, and important details like contact information and activities and workflows are just a single click away.

Whether you use Redtail CRM or an alternative solution such as Junxure, Salesforce, Wealthbox, and others, these are the types of features and functionality you’re going to need if you expect to cultivate meaningful relationships with clients and differentiate yourself from the $(!#-advisers, uh, I mean, online investment providers.] Redtail Technology just released a major upgrade to its popular CRM application. Dubbed Project Tailwag, this version of Redtail — only the third upgrade in the company’s 12-year history — offers a host of new enhancements.

Racing Ahead from Financial Advisor

[And finally, Joel Bruckenstien once again wraps up this week’s top stories with a technology update from the nation’s leading broker-dealers firms. In his column for Financial Advisor magazine, Bruckenstein highlights LPL Financial’s announcement of ClientWorks, the successor to the existing BranchNet platform that I covered in episode 137, an updated portfolio reporting solution and Client Center dashboard from Raymond James, updates to Commonwealth Financial Network’s Client Household 360 Dashboard and Practice360 business dashboard, and the AIG Advisor Group’s pending release of a mobile version of Salesforce and with integrated Salesforce work flows.

Clearly these broker-dealer firms are investing heavily in technology to boost the capabilities of their representatives, especially as they face increasing competition from all of the $(!#-adviser, ugh, online solutions out there.] The pace of technological innovation has never been greater. Independent broker-dealer firms continue to invest to keep up with the competition, offering advisors and end clients a better experience.

Here are the stories that didn’t make this week’s broadcast:

Risk Tool Smackdown: FinaMetrica vs. Riskalyze from Financial Planning

I tested myself using two of the more popular risk tolerance instruments: Riskalyze and FinaMetrica.

Smarsh Introduces Enhanced Archiving Support for Instagram from BusinessWire

Smarsh®, the leading provider of hosted archiving solutions for compliance and e-discovery, today announced the Smarsh Archiving Platform now offers enhanced support for Instagram.

Personal Capital integrates Zillow home estimates from Personal Capital

For those of you with property, Personal Capital has come out with a great new feature that will help you keep track of your real estate investments with Zillow.

Watch FPPad Bits and Bytes for October 3, 2014

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