Stuart DePina will step down from his role as president of Envestnet at the end of June as part of a larger corporate restructuring at the fintech and investment outsourcing giant.
Envestnet is reorganizing into three segments: Envestnet Solutions, led by current co-chief investment officer Dana D’Auria; Envestnet Data and Analytics, led by current global head of data and analytics Farouk Ferchici; and Envestnet WealthTech, which will be led by current Envestnet MoneyGuide president Tony Leal. The three group presidents will report to Tom Sipp, who has been promoted from group head of Envestnet Solutions to executive vice president of business lines.
DePina, who joined Envestnet when it acquired portfolio management software company Tamarac in 2012, will remain with Envestnet as an adviser, according to the company.
InvestmentNews reported in April that DePina was expected to depart the company. Envestnet declined to comment at the time. He appeared as the company’s president as recently as May 12, when he delivered 10 minutes of closing remarks on stage at the Envestnet Advisory Summit conference.
The new alignment is the result of years of work to bring together parts of Envestnet's business that weren't connecting, said co-founder and CEO Bill Crager. After Crager and DePina partnered to lead the Envestnet following former CEO Jud Bergman's death in 2019, they created a road map for a more integrated company.
"The point that we were aiming at is really today, transitioning from the Envestnet we were to the Envestnet that we’ve been working toward over the last two years," Crager told InvestmentNews.
Part of that plan including preparing Envestnet for the next generation of leadership, Crager said when asked why DePina is stepping down. DePina was not made available for comment.
"There's nothing more to it than that. The work that we aimed to do together is done, and now we are beginning the next chapter," Crager said, adding that he can't thank DePina enough for his contributions. "I’m more engaged and enthusiastic about the possibilities of our company than ever before because of the work we did."
The new corporate structure is “a pivotal moment” for the company and sets the direction and pace for future growth, Crager said in a statement. The company has reportedly been exploring a sale since February but has been struggling to close a deal since markets started to fall, according to Barron’s.
When asked if the new alignment is a step toward a deal, Crager said Envestnet is focused on execution, driving growth and improving financial wellness for investors and the advisers who serve them. “That’s what gets me up every day and that’s what we’re focused on. Period,” he said.
It’s Envestnet’s second corporate restructuring in fewer than four years. In January 2019, former CEO Bergman consolidated operations into two segments: Wealth Solutions, led by Crager, and Data & Analytics, led by DePina.
DePina was promoted to president in 2020 when Crager was named CEO after Bergman’s death in 2019.
The new structure splits Wealth Solutions into two groups. The Solutions team will focus on wealth and asset management products across the Envestnet ecosystem, working on things like research, overlays, portfolio management, direct indexing, sustainable investing, retirement services and partnerships between Envestnet’s exchanges and other wealth management firms. Envestnet WealthTech will consist of the tech teams building products for Envestnet’s advisory clients, such as MoneyGuide and Tamarac. This will help Envestnet better serve firms that just want access to technology and those that want outsourced investment management, Crager said.
The latest reorganization appears to be an attempt to rationalize the acquisitions Envestnet has made over the last decade, said Timothy Welsh, founder and CEO of consulting firm Nexus Strategy. On June 1, Envestnet bought digital retirement plan company 401kplans.com.
“Buying is easy but integrating is hard,” Welsh said. “it also looks like they are just moving siloed pieces into new silos, instead of aligning these components along customer segments, so the integration challenges will remain.”
Crager disputed this observation, saying the new structure demonstrates the company has fully integrated data into tech across its business lines.
He added that the "sum of Envestnet's parts" is a bigger competitive differentiator than anything else. "This is the fruition of it coming together and integrating the parts," Crager said.
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