After the Covid-19 delta variant cancelled 2021 plans, the Technology Tools for Today conference made its long-awaited return this week.
This year’s event was the most attended in the event’s history, according to T3 president Joel Bruckenstein. Around 1,000 people came to Denton, Texas — nearly half of whom represented advisory firms — to learn about innovative startups and the latest trends driving the world of adviser technology.
It was the first live event in more than two years for many attendees, and what the advisory industry will look like after the pandemic was a major theme at the conference, Bruckenstein said.
“I remember very distinctly in March 2020 getting calls from advisers who had never done a video conference, had never worked remotely and had no idea what they were doing,” he told InvestmentNews. “They realized the world is changing and they need to up their game.”
Several speakers presented data on how the coronavirus affected the technology landscape for independent advisers. For example, 40% of advisers put together a digital strategy for the first time during the pandemic, according to Tricia Haskins, head of integration solutions at Fidelity Investments.
Fintech companies saw a surge in use. For example, the frequency of logins to the Black Diamond client portal quadrupled during the pandemic. Envestnet MoneyGuide reported a 40% increase in the number of new financial plans created on the software and a 40% increase in logins by existing clients, said Dani Fava, Envestnet's head of strategic development. The number of clients aggregating their account data on MoneyGuide also increased 96%, Fava said.
How these changes impacted advisers’ adoption of technology was reflected in the latest edition of the T3 Inside Information software survey, which Bruckenstein and Inside Information owner Bob Veres released at the event.
Client relationship management software (CRM) continued to lead in terms of market penetration, with 97% of advisers using a CRM, up from 92% in the 2021 survey. Document processing, estate planning and tax planning technology saw the largest increases in adoption.
The all-in-one platforms created by ongoing consolidation in the adviser fintech space are increasingly popular among advisers, in terms of both market penetration and satisfaction ratings, according to the latest T3 survey.
More than 20% of advisers now use one, with Orion Advisor Solutions leading the way, compared with 18% in in 2021. While all-in-one platforms long had a reputation for being collections of lesser tools, they are increasingly helping advisers solve integration issues, Bruckenstein said.
“The best-in-breed model that many embraced over the last two decades has some limitations,” he said. “The advantage [of all-in-one products] is everything is on a single database with one point of contact, so if something breaks you know who to call. They may not be the best at everything, but it’s much simpler and if it’s done well, it’s more efficient.”
Perhaps unsurprisingly, given its prominence on the survey, CRM was a major theme at the conference. AdvisorEngine CEO Rich Cancro showed off the configurability of his company’s recently revamped CRM and how advisers can use it to build a comprehensive, data-driven tech suite that connects planning, portfolio management and marketing. Startup CRM Science showed how it can help advisers build a more efficient client-facing software platform out of Salesforce, while Catchlight demonstrated a new AI approach for improving prospecting using Redtail CRM.
Envestnet presented its own vision for an all-in-one technology dashboard built around CRM, trading and financial planning thanks to a tighter integration between Tamarac and MoneyGuide. The fintech giant is also releasing a new user interface to create a cohesive experience across its various businesses and announced plans for a new client portal and proposal generation tool.
Orion didn’t have much to say about its recent acquisition of Redtail CRM, but founder and CEO Eric Clarke did announce plans to utilize Amazon Redshift, the data warehousing segment of the Amazon Web Services cloud computing business, to improve the speed, performance and scalability of data processing on Orion.
“Data is the lifeblood powering the financial advice industry’s rapid expansion and advancement, which makes the issue of data accessibility and transparency a critical challenge facing advisers,” Clarke said in a statement. “Newer cloud technologies have the power to dramatically reshape our industry and offer a simple, elegant solution to the ongoing issue of stale and inefficient data delivery.”
Daniel Crosby, Orion’s chief behavioral officer, also presented plans to incorporate more behavioral finance into Orion Planning, its goals-based planning technology.
“We believe a seamless, embedded approach to goals-based investing can improve people’s investment experience, increase returns formerly sacrificed to misbehavior, and all investors to worry less about ‘the economy’ as they become increasingly focused on ‘my economy,’” Crosby said in a statement.
One area that still lags in adoption among financial advisers is retirement income technology, according to the T3 survey. With thousands of Baby Boomer clients retiring daily, this represents a wide-open opportunity for fintech companies, Bruckenstein said.
Several fintechs demonstrated the work they are doing here. For example, Envestnet is improving the process by helping advisers model annuities from its Insurance Exchange within MoneyGuide and going straight to an account-opening process or taking advisers from estate planning to trust account opening.
William Meyer, CEO of Income Solver, demonstrated his company’s vision to build the first turnkey asset management platform focused entirely on clients in the decumulation phase of their financial lives. Beyond just withdrawal sequences or annuities, a true decumulation TAMP must also account for Roth conversions, asset allocation and rebalancing, asset location, tax-loss harvesting and Social Security, Meyer said.
“I contend that lots of Baby Boomers will run out of money, and they are looking for advisers that can help them maximize their wealth,” Meyer said. “If you can do this well, you will disintermediate a lot of relationships.”
It wouldn’t be T3 without fintech companies taking advantage of their stage time to make major announcements.
From the main stage, SmartX CEO Evan Rappaport told the audience that his company had closed a $30 million round of funding from Morningstar Investment Management. Rappaport also announced that SmartX’s technology will replace Morningstar’s legacy TAMP infrastructure and be used to build out a direct indexing product.
“The TAMP architecture is broken,” Rappaport said, adding that his company plans to introduce manager-traded sleeves, client-directed trading, cryptocurrency support and hedge funds.
FP Alpha, a planning software created by Altfest Personal Wealth Management president Andrew Altfest, also debuted its latest product, The Estate Snapshot. The artificial intelligence-powered software scans wills and trusts to summarize and visualize the key elements of a client’s estate plan.
Advisers should pay attention to what FP Alpha is building if they want to expand the types of services they can offer clients, said adviser technology analyst Ian McKenna.
“There is enormous potential for this service to transform financial advice,” McKenna tweeted. “Anyone looking to build a hybrid advice proposition should be looking at this.”
However, one of the biggest stories to come out of T3 might be the stories that didn’t come out of it. Although Snappy Kraken had a presence in the T3 exhibit hall, it announced its acquisition of Advisor Websites during the conference, but didn't talk about it on stage. Snappy Kraken, an adviser digital marketing firm, kicked off its own conference Wednesday in Las Vegas.
Wealth management software company Addepar also launched a new integration center for firms but didn't make the announcement at T3 despite having people at the conference. Same with the Tifin group, which acquired two financial education fintechs, All Star Charts and INO.com.
The companies declined to comment why they didn't make their announcements at T3.
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