What Charles Schwab selling PortfolioCenter to Envestnet Tamarac Means for You

What happened?

In a move anticipated by a number in the industry, Charles Schwab is selling its PortfolioCenter product to Envestnet Tamarac. PortfolioCenter, which is a portfolio management and reporting engine, is used by over 3,000 registered investment advisory firms who will now be searching to replace a product that they have come to rely on.

For the uninitiated, PortfolioCenter was originally introduced in 2010 as a core element in Schwab Advisor Services’ plan for a “cloud-based, multi-custodial portfolio manager” set to compete with companies like AssetBook, Tamarac, and Orion. However, when SVP of Digital Adviser Solutions, Andrew Salesky took over in the summer of 2018, the company shifted gears to partner with third-party vendors while debuting their PortfolioConnect product.

Envestnet announced this acquisition without reporting terms of the deal in late February while reporting its fourth quarter earnings for 2018.

What does it mean for you?

Tamarac and Schwab have a number of synergies; however, it remains to be seen whether or not the group can actually do enough to meet the needs of current PortfolioCenter users. Already, the team at Tamarac has tried to prevent the exodus of financial advisors currently using the PortfolioConnect product by offering to honor the contracts of current users.

“We will not force anyone to switch portfolio management applications,” said Andina Anderson, Executive Managing Director at Envestnet | Tamarac. To support this statement, Envestnet | Tamarac shared the discounted deals to advisors who in turn shared those details with news outlet, Financial Planning. They reported that those deals “offer a year free for Outsourced Solutions if advisors sign a four-year deal, or two years free if advisors sign a seven-year deal.”

They also shared that  “the basic PortfolioCenter package, which does not include the added on tools, costs roughly $3,000 per year, according to one advisor. To put this figure in perspective, it was also reported that the cost for current Tamarac services for a group with “$200 million in AUM and 200 accounts would cost approximately $16,000 a year.” This is a steep climb from what users were previously paying for their portfolio management and performance reporting.

These figures were shared by a PortfolioCenter user, Erica Safran of NY-based Safran Wealth Advisors, who declined the upsell for Tamarac services but decided to continue using PortfolioCenter through the honored contract. The same source also commented that “The platform would best suit advisors who use multiple custodians, don’t use model portfolios and can’t do operations in-house.”

It’s plain to see that the multi-year (7 years!!) contracts that Tamarac is offering current PorfolioCenter users to stay onboard is simply a strategy to keep them in the fold long enough to upsell them. However, going back to PortfolioCenter user Erica Safran, she said that “the premium tools would not have provided enough value to her firm…and the length of the contract was disconcerting.” She continues, “for your home mortgage, lock yourself in,” Safran says. “But, in terms of technology, being locked in for long periods of time just doesn’t make sense. Seven years would have been a lifetime.” A lifetime of being hounded by the upsell machine and rising costs indeed.

Our Take

While there is and will be plenty of debate on what the top portfolio management or performance reporting platform is “the best”; many of these larger companies miss the mark on what’s really important. That’s providing a tool and a technology that seamlessly fits the need of the user without pressuring them into paying more for capabilities and services that they don’t really need.

Often times more isn’t always better. If you have a process that is working and need capabilities that specifically fit or enhance that workflow, be weary of the upsell. After all, you’re in the business of making money, not burning it.

The Future of Finance: Top 5 Fintech Trends to Watch in 2019

Traditionally, the financial sector has been slow to invest in and adopt groundbreaking technologies. However, in 2018 we saw a number of well-established institutions kick “tradition” out the door to make way for the real world results produced by a number of fintech applications that have established their proof of concept as well as their viability in today’s market.

Continue reading The Future of Finance: Top 5 Fintech Trends to Watch in 2019

Joel Bruckenstein’s 2017 T3 Conference was the Biggest to Date

This year’s T3 (Technology Tools for Today) conference attracted an impressive number of attendees.  With more than 600 in attendance, the conference has doubled in size the past several years.

The conference also seems to be THE venue for fin-tech firms to announce new ventures, software versions, and integrations.  There is no better conference for advisors keen on keeping up with cutting edge technology in the financial services sector.

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AssetBook exhibitors Jimmy Wilkes and Rob Major

Takeaways:

We noticed a couple of trends creating buzz at the show… most notably robo technology for advisors and truly seamless integration of advisor technology.

On the robo front, we noticed that in addition to established portals like Betterment and Oranj, systems new to the space like Advisor Engine not only showed up but sponsored the conference at the Platinum level.  Riskalyze announced its own new robo-esque platform as well.

It appears that advisors are continuing to embrace the technology that the robos are bringing to the table.  These platforms eliminate the need for human intervention to assist in client onboarding, risk profiling, model design and implementation.

Seamless integration of advisor facing apps may seem like a broken record at this point.  Some of you may remember the decade-old Silver Bullet campaign.  Until now, it really hasn’t evolved all that much as most integrations between advisor apps still use old-school “push-pull” techniques or old-school web services.

Modern APIs are the key to achieving rich and meaningful integration of your CRM, PMS, Planning and Trading systems.  It also seems like the custodians may play a role in connecting the APIs in a standard way.

Presentations:

As always, we enjoyed the speakers, especially Bob Veres.

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Bob was talking about “The One Solution”, which refers to his theory that the financial planning industry is basically “stalled” in terms of advisors attracting new clients.  In summary, Bob presented a viable solution to the problem that included employing younger succession advisors, improving your on-line presence including digital reporting, leveraging communication technology (like Skype and Facetime), and building niche communities of clients to serve.

The presentation was enlightening and Bob goes into detail on his theory, as well as many other revelations in his new book named The New Profession.  In our opinion, the book is excellent and is a must-read for financial professionals.

Finally, Rob Major spoke on the topic of identity fraud in a presentation named “The $100,000 Lesson Learned.”  He shared a true story about how a client of a well-established RIA firm was victimized by a fraudster, and how and why the RIA was responsible for paying the money back.

Again, we can’t say enough good things about the T3 conference and hope to see you next year in Ft. Lauderdale, FL for the 2018 conference.  It will be held February 6-9, 2018 at the Marriott Harbor Beach Resort and Conference Center.

TD Ameritrade LINC National Conference Recap

This year’s TD National LINC 2017 conference was our best ever!  This conference gets better every year, so if you missed it consider going next year.

Highlights from the conference:

A major focus of the conference was the roll out of Veo One, TD’s new integrated advisor desktop.  This could be the best platform for integration we’ve seen so far. We’ll join the new platform as an integration partner in the near future.

We were also impressed with the advancements to iRebal. Advisors using standard models could benefit heavily from the new automation features that are built into the trading system.

Thanks to everyone that came by to see us in Veo Village. David Robertson and Frank Taylor enjoyed speaking to each of you.

Congratulations to Todd Resnick, CFP®, who won our giveaway, a GoPro.

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Todd Resnick, CFP® of OneSeven (left) and Frank Taylor of AssetBook.

Great job TD Ameritrade for a great conference!

Winter Conference Update

TD Ameritrade Link 2017 National Conference

Conference Dates: February 1-3, San Diego, CA

Please come and see David Robertson and Frank Taylor at our kiosk in Veo Village at the TD Ameritrade Link national conference in San Diego, CA.

We’ll be demonstrating everything new at AssetBook at the kiosk.

T3 (Technology Tools for Today) Conference

Conference Dates: February 14-17, Orange County, CA

Later this month, Rob Major and Jimmy Wilkes will be manning the AssetBook booth at the T3 conference in Orange County, CA.

If you are attending the show, please come by our booth in the exhibit hall.

Rob Major will also be speaking about identity fraud on Friday, February 17th at 8:40 am.  Please join him for his presentation, “The $100,000 lesson learned”.

Happy New Year! – Holiday Hours

In observance of the New Year’s holiday, our office will be closing at 2:00 pm on Friday, December 30, 2016, and will be closed Monday, January 2nd, 2017.

We will reopen for normal hours starting January 3rd, 2017 for end of quarter/year processing.

At the close of another great year, we gratefully pause to wish you a New Year filled with Peace, Prosperity, and Happiness!

Holiday Hours

Happy Thanksgiving from all of us at AssetBook!

Our office will be closed on Thursday, November 24th and Friday, November 25th in observance of the Thanksgiving Holiday.

We will resume normal business hours on Monday, November 28th.

Thanks to Bob Veres and Jean Sinclair for an excellent conference

Bob Veres’ Insider’s Forum conference just keeps getting better year after year. We really enjoyed visiting with our clients and catching up with many old friends last week.   The venue, which was the historic Hotel Del Coronado in San Diego, was amazing.

There was a large emphasis on robo-advisors and how they are beginning to play a complementary role in professional financial advisory firms.

There was also much discussion about how the new Dept. of Labor fiduciary rule is impacting advisors and how the robos can participate in digital management IRA accounts that now must be managed.

Congratulations to Skip Schweiss, Managing Director of Retirement Plan Services at TD Ameritrade, for winning this year’s Insiders Forum leadership award.  According to Bob Veres, Skip played a major role in Washington lobbying for the new DOL ruling.  Rob Major and Skip go back 17 years and all of us here at AssetBook want to congratulate him for his valiant efforts.

skip Skip Schweiss

We got word that next year’s Insiders Forum will be held in Nashville, TN.  We will definitely be there and hope to see you there too!