Envestnet, the wealth management industry’s largest provider of outsourced technology and asset management, unveiled the latest updates to its advisor platform and revealed some significant new partnerships at its annual conference in Denver this week.
On the product side of things, improving the digital experience for advisors and clients was a significant theme. Envestnet measured a 39% increase in new clients granted access to the digital portal during the pandemic and a 44% increase in logins, so providing a modern and intuitive digital experience is a primary focus, said Molly Weiss, Envestnet’s chief product officer for wealthtech and solutions.
Envestnet is planning to roll out a new advisor experience in June, Weiss said. The new client portal is already out in the market, and a new mobile app version is coming in June.
Industry observers like Joel Bruckenstein, the president of the Technology Tools for Today conference, reacted positively to the new client portal.
“I am very impressed with the new [Envestnet] client portal,” Bruckenstein said on Twitter. “They are still adding features, but this really is impressive.”
Part of improving the digital experience is making both the client and advisor dashboards more customizable. The client portal is based on a set of widgets that advisors can set or allow clients to customize as they see fit. Advisors can also set multiple configurations of the client portal for different client segments.
Personalization also extends to the advisor-facing dashboard, where Envestnet is adding new features for advisors to tweak proposal generation workflows and access to managed accounts, Weiss said. The idea is for firms across Envestnet’s vast book of business to offer more custom financial advice across large books of business. Envestnet now serves 106,000 financial advisors across 16 of the 20 largest U.S. banks, 47 of the 50 largest brokerages, and more than 500 of the largest RIAs, with a collective $5 trillion on its platform.
“How do you allow an advisor to create [fully] custom portfolios for clients and do that at scale?” Weiss said.
Direct indexing and the ability to overlay client-specific tax optimization is part of the answer, Weiss said.
Envestnet is also looking to better utilize its vast data capabilities to automate advisor workflows and surface next best actions. Envestnet’s Insight engine can pinpoint and surface actions to help clients, such as tax opportunities, a need for a guaranteed income product or held-away assets that can be moved over.
“Accounts that are out of balance, or if there's a certain security in the news that day, we identify those accounts really quickly that [advisors] need to take action on,” Weiss said.
In his keynote address, Envestnet CEO Bill Crager said the Insights engine currently has 95 different use cases, and advisors can increase revenue by 31% just from existing accounts.
Technology integration continues to be important to create a unified digital ecosystem that breaks down the traditional barriers between segments of the financial services industry, Crager said.
“Our job will be to connect people’s money,” he said. "There's a need to connect the dozens of technologies that you and your firms use to serve your clients.”
At the top of the list is better integration with industry-leading CRM systems, Weiss said. While Tamarac hasn’t gone much deeper than single sign-on with many popular CRMs, the company has new external API capabilities to deepen the connection with software like Redtail and Wealthbox, she said.
Cragers also spoke about the need to further simplify the administration and service side of the business.
“It’s still painful. It’s 2023 and it’s still hard to open an account,” he said.
To that end, Envestnet revealed more information about its new partnership with FNZ, a digital custodian founded in New Zealand that's expanding internationally. FNZ acquired fixed-income portfolio management fintech YieldX in January to accelerate its expansion in the U.S., and in October, Envestnet first announced the partnership to explore developing an RIA custodian.
By combining Envestnet’s technology with FNZ’s digital custody services, the goal is to create a more unified digital ecosystem for advisors that includes automated digital account opening and instant accounting funding, said Tom Chard, CEO of FNZ North America.
“We’ve been working together now for quite awhile and we’re still on track to deliver our first proposition by the end of the year,” Chard said.
While other digital custodians have limited registration types and services, FNZ provides everything needed to serve Envestnet’s client base, from independent RIAs to large financial institutions, Weiss added.
Envestnet will maintain its partnerships with Charles Schwab, Fidelity and BNY Mellon Pershing, and FNZ will simply be another choice available to advisors, said Rich Aneser, Envestnet’s chief strategy officer.
“We believe there will be a group of clients who might find the fully aligned digital capabilities of FNZ with the front end of Envestnet and a more seamless digital experience will be a compelling offering,” Aneser said.
FNZ also provides opportunity for Envestnet to expand its technology and asset management capabilities into international markets, Aneser said.
Envestnet used its conference to reveal a new partnership with Empower, a retirement plan service provider with more than $1 trillion in assets. Empower is looking to expand its footprint in the wealth management industry, and Envestnet will act as a distributor giving advisors easy access to retirement plans, said Sean Murray, head of investment retirement solutions at Envestnet.
With many states mandating that small businesses offer retirement plans, there's an explosion in demand for smaller plans. Business owners often turn to their financial advisor for help, but most advisors are ill-equipped for these conversations, Murray said.
“We need Empower from a retirement perspective because we don’t have a record-keeping platform,” he said. “We can act as external fiduciary [for advisors] and remove the burdens that prevent them from offering retirement plans.”
Empower plans can be accessed today, and Envestnet plans to build new technology that makes it quicker and easier to access products in their digital dashboards, Murray said.
Relationships are key to our business but advisors are often slow to engage in specific activities designed to foster them.
Whichever path you go down, act now while you're still in control.
Pro-bitcoin professionals, however, say the cryptocurrency has ushered in change.
“LPL has evolved significantly over the last decade and still wants to scale up,” says one industry executive.
Survey findings from the Nationwide Retirement Institute offers pearls of planning wisdom from 60- to 65-year-olds, as well as insights into concerns.
Streamline your outreach with Aidentified's AI-driven solutions
This season’s market volatility: Positioning for rate relief, income growth and the AI rebound
