In this edition of the Wealthtech Roundup, we speak with our newest Wealthtech Leader of the Month, Michael Batnick, Managing Partner at Ritholtz Wealth Management, who discusses the upcoming Future Proof Festival and its Fintech Demo Drop III.
Other entries include Genstar Capital making a majority investment in Docupace, RISR partnering with Journey Strategic Wealth, Domain Money hiring Kyle Sausser as Head of Growth, Dynasty Financial Partners promoting Leslie Dentinger Norman to CTO, iCapital partnering with Perigon Wealth Management, InvestCloud partnering with Buckingham Strategic Wealth and Buckingham Strategic Partners, The Oasis Group releasing an AI WealthTech Map, BMO finding that 61% of Gen Z uses AI for finances, LPL Financial hiring Sushil Vyas as CTO of Infrastructure and Operations, ACA Group acquiring Encore Compliance, and Arete Wealth tapping BNY Pershing for its custody and Wove solutions.
Larry’s Take
By now we’ve all seen the news about the CrowdStrike glitch that resulted in massive Microsoft-related technology problems around the world, and affected companies in sectors ranging from airlines to news broadcasters to banks to stock exchanges.
The lesson for the wealth management industry is that there are massive risks to everyone relying on the same technology. Some of this is unavoidable in the short term. For example, Microsoft Outlook is the default email platform and Google is the default search engine for most businesses in the U.S., regardless of sector.
Thankfully, the independent wealth management space may have an advantage over wirehouses and other big banks when it comes to diversifying tech stacks. The very nature of independence is for firms to choose their own tools as needed, instead of conforming to a single standard. App integration makes this possible, albeit with limits.
And the downside to many different independent wealth management firms using many different tech stacks is that users must constantly be learning how to use new tools, which takes up time that could otherwise be spent with clients and prospects. But that’s still better than telling clients you can’t access their money because of a ubiquitous tech glitch.
If you would like to discuss this Larry’s Take further, including how these trends might impact your business, please contact me at larry.roth@rlrstrategicpartners.com.
1. Michael Batnick Of Ritholtz Wealth Discusses Future Proof’s Fintech Demo Drop III
The annual Future Proof Festival that will occur from Sept. 15 to 18 in Huntington Beach, California, also will feature its third annual Fintech Demo Drop. Seven finalists, narrowed down from more than 100, will present their products and platforms: Canopy, Dispatch, FINNY AI, Fynancial, Jump, LODAS Markets and TaxStatus.
New-York-based Ritholtz Wealth Management, which had over $5 billion in assets under management (AUM) as of its August SEC ADV filing, has been a close partner to Future Proof since its inception in 2021, with Ritholtz Chairman and CIO Barry Ritholtz and CEO Josh Brown having almost as much of a presence at the festival as Future Proof Founder and CEO Matt Middleton.
And now for our Q&A with Michael Batnick, Managing Partner at Ritholtz Wealth Management.
WSR: What do Future Proof attendees have to look forward to with this year’s Fintech Demo Drop III finalists?
Batnick: Future Proof Festival is already the largest annual marketplace for fintechs and wealth management decision-makers. For advisors and wealth management professionals, there’s no better place to see the latest innovations in wealth and advisortech. For fintech companies, it’s the ultimate event to build awareness, meet potential clients and connect with buyers.
The Fintech Demo Drop, one of our most talked-about sessions, is a major highlight. The finalists for year three aren’t just demonstrating new tools; they’re offering attendees a glimpse into the next generation of financial technology.
The tools that will be presented this year are helping advisors become more efficient, engage more prospects, serve more clients and perform bespoke investment management activities faster than ever before. I have no doubt that this year’s finalists will impress while on stage.
WSR: Are there any other major wealthtech-themed events or announcements in the works for this year’s Future Proof Festival?
Batnick: This year’s agenda features over 100 sessions with many focusing on technology – whether that’s AI’s role in transforming your firm or investment opportunities in tech.
The Festival will be bigger and better than ever this year. The outdoor space and boardwalk have been expanded by approximately 30%. We’re also introducing a new Fintech Alley – a dedicated space for buyers to demo innovations that will help shape the future of our industry. Fintech Alley and the Fintech Demo Drop III are just two initiatives that highlight Future Proof’s commitment to leveling the playing field and driving the industry forward.
Additionally, the Breakthru Meetings Program is the largest of its kind, and will facilitate more than 30,000 one-on-one meetings in just two days at the Festival. Breakthru has made it easier than ever for attendees to meet; build lasting, impactful relationships; and maximize ROI.
There will also be 100 pre-scheduled peer group discussions and more than 50 Breakthru Experiences, providing even more opportunities to share insights, make connections and generate actionable takeaways.
WSR: Why else should advisors, firm leaders and other wealth management industry players attend this year’s Future Proof Festival?
Batnick: The confirmed speakers are the “who’s who” of fintech leaders, wealth management execs building or implementing tech, and prolific investors who are active in shaping the future of our industry.
Plus, this year is set to be the biggest yet. The team expects more than 4,500 attendees, representing almost $22 trillion in assets, in Huntington Beach next month. Future Proof has already surpassed the registrations for 2023, and there are still six weeks to go.
I firmly believe that the Festival creates meaningful opportunities for fintech companies, large and small, to compete in today’s crowded marketplace – all while helping advisory firms make better, more informed decisions when it comes to their tech stack.
2. Genstar Capital Makes Majority Investment In Docupace
Genstar Capital, a private equity firm focused on investments in targeted segments of the financial services and other industries, announced a strategic majority investment in Docupace, a provider of software built to streamline back-office operations of wealth management enterprises and financial advisors. The investment empowers Docupace’s next stage of growth and innovation.
FTV Capital, which made a growth investment in the company in 2020, will remain a minority investor in Docupace. Under FTV’s ownership, Docupace grew as a platform for wealth management operations. The platform now processes more than 130,000 electronic documents each workday. In 2021, the company expanded its platform solutions with the acquisitions of jaccomo and PreciseFP.
“Genstar’s investment is a testament to our belief that Docupace is transforming how critical work – new account opening, client onboarding, workflow, compliance, compensation, advisor transitions, data gathering and client engagement – gets done in wealth management enterprises,” said Docupace CEO David Knoch.
3. RISR Partners With Journey Strategic Wealth On Business Owner Engagement
RISR, a business owner engagement platform for financial advisors, partnered with Journey Strategic Wealth to help advisors on Journey’s platform drive organic growth with business owners. As a result, the advisors can collect business data using QuickBooks or tax documents and uncover insights on valuation, growth opportunities and risk management for their clients.
In June, RISR closed a $1.5 million capital raise. RISR also recently hired Alex Michaels as Head of Product and Megan Cochran as Head of Engineering from the business software developer Relay. RISR’s platform supports succession and exit planning, estate and legacy planning, retirement planning, insurance coverage, tax planning, and capital and liquidity planning for advisors.
“Through this partnership, our advisors are able to thoroughly communicate with business owner clients and feel confident about the advice they’re giving,” said Penny Phillips, President and Co-Founder of Journey Strategic Wealth. “Clients and prospects alike are blown away by what RISR teaches them about their own business, and this is a way to truly validate value proposition within a specific niche.”
4. Domain Money Hires Kyle Sausser As Head Of Growth, Enhances Service Offering
Domain Money, a technology-driven flat-fee financial planning platform, hired Kyle Sausser as Head of Growth, and released its new design and service offering. Most recently, Sausser was Vice President of Marketing for ConsumerDirect, a credit building and privacy tool provider. Before that, he was Head of Partnership and Affiliate Marketing at the self-directed investment app Acorns.
Founded in 2022 by Adam Dell, the former Head of Product at Marcus by Goldman Sachs, Domain Money connects people with advisors who hold the Certified Financial Planner (CFP) designation. Its new platform applies technology from OpenAI and Holistiplan to analyze demographic, transaction, investment and retirement data, while employing a generative language model to accelerate plan preparation and reduce time spent on manual tasks.
“Domain’s flat-fee offering was particularly appealing to me given my experience with investment-focused firms that charge fees based on assets,” Sausser said. “It’s high time more of our industry challenged this norm.”
5. Dynasty Promotes Leslie Dentinger Norman To CTO
Dynasty Financial Partners promoted Leslie Dentinger Norman from Deputy Chief Technology Officer to Chief Technology Officer. Before joining Dynasty in 2022, she was a Business Technology Manager at Raymond James.
Norman has been responsible for directing the strategy and delivery of technology solutions across the Dynasty Network. Under her leadership, Dynasty is rolling out an automated and integrated platform that provides advisors with a holistic view of data, analytics and insights to help grow their businesses. Dynasty recently surpassed $100 billion in assets on its platform.
“In the wealth technology space, the pace of change and the complex range of technology options can be overwhelming to RIAs,” Norman said. “So, when it comes to our technology strategy, we follow the same advice that we give our clients: find great partners to capitalize on outsourced scale when you can and build it yourself where you see a gap.”
6. iCapital Partners With Perigon On Advisor Access To Alternative Investments
iCapital, a fintech platform and alternative investment marketplace, partnered with Perigon Wealth Management, a San Francisco-based RIA with approximately $7.75 billion in client assets as of March 31. Perigon’s advisors will be able to automate and streamline parts of the private markets investment process while connecting clients with private equity, private credit, hedge fund and real asset investments.
iCapital, which had $187.5 billion in global platform assets as of April 30, earlier this year announced partnerships with Ashton Thomas Private Wealth, Commonwealth, Gratus Capital, MassMutual and Resona Bank. It also acquired the wealthtech firm Mirador, a provider of investment data aggregation and financial reporting of alternative and traditional investments.
“Enhancing access to high-quality alternative investment opportunities supports our growth strategy by giving our advisors the tools they need to deliver strong, diversified portfolios to our clients while also attracting sophisticated advisors and clients to our firm,” said Art Ambarik, CEO of Perigon. “Establishing partnerships with leading alts platforms like iCapital helps firms like ours meet the growing demand for alternatives while leveraging the extensive support infrastructure provided by iCapital to remain relevant within this dynamic space.”
7. InvestCloud Partners With Buckingham Firms To Integrate Advisor Platforms
InvestCloud, a provider of wealth and asset management solutions, partnered with Buckingham Strategic Wealth and Buckingham Strategic Partners, which manage or administer more than $70 billion of collective assets as of March 31. Buckingham advisors using InvestCloud’s Advisor Experience will gain access to cloud-native, modular technology that integrates CRM, financial planning and portfolio management in a single dashboard.
Buckingham Strategic Wealth recently merged with The Colony Group, a Focus Financial Partners firm. Buckingham Strategic Partners provides a turnkey asset management program (TAMP). InvestCloud supports over $6 trillion of assets with over 550 direct clients, including banks and wealth managers, private banks and asset managers.
“One of our top priorities is to enhance the digital experience we deliver for our advisors, and in particular, time-saving capabilities that will enable them to best serve their clients,” said Adam Birenbaum, CEO of Buckingham Strategic Wealth and Buckingham Strategic Partners. “We’re excited about our partnership with InvestCloud.”
8. The Oasis Group Releases AI WealthTech Map, Breaking Down Firms By Category
The Oasis Group, a consultancy, released its AI WealthTech Map as a resource for financial advisors and wealth management firms to discover potentially useful artificial intelligence solutions and AI-focused firms serving the industry.
The interactive map features 55 fintech firms across nine categories: prospecting, writing assistant, note-taking for wealth, general note-taking, proposal generation, AI assistant / co-pilot, investment research, next best action and compliance. Clicking on icons in the downloaded version of the map takes users to the websites of the respective firms.
“We strongly recommend that firms begin to leverage AI to gain familiarity with its capabilities and concerns, to learn new skills like prompt engineering, and to clearly identify how they plan to leverage AI in projects,” said John O’Connell, Founder and CEO of The Oasis Group. “The future of wealth management is here, and it’s powered by artificial intelligence.”
9. BMO Survey Finds 61% Of Gen Z Use AI For Finances And Investments
BMO Financial Group released its BMO Real Financial Progress Index that surveyed a sample 2,501 adults in the U.S. from May 31 to June 21. It found that 61% of Gen Z respondents use AI to help manage their finances and investments, more than any other generation, and that 37% of total respondents use AI to help manage their finances.
The index also found that 53% of respondents believe AI can help people make more informed financial decisions and 59% of respondents are using AI to ask questions about topics of interest – yet 64% of respondents do not believe AI understands how emotions influence financial planning. BMO had total assets of $1.4 trillion as of April 30.
“While AI handles technical aspects and routine tasks, a professional advisor brings a human touch, offering personalized guidance and understanding,” said Paul Dilda, Head, U.S. Consumer Strategy, BMO. “Together, they create a holistic approach to financial management, ensuring more Americans stay on track towards their goals and make real financial progress.”
10. LPL Appoints Sushil Vyas As EVP And CTO Of Infrastructure And Operations
LPL Financial appointed Sushil “Sid” Vyas as Executive Vice President and Chief Technology Officer of Infrastructure and Operations, overseeing the stability and reliability of LPL’s operating platforms. He is based Fort Mill, South Carolina.
Vyas has over 25 years of experience as a senior-level executive and technology transformation specialist. Most recently, he was CTO of Mizuho America Services. Before that, he spent 20 years at Wells Fargo and its legacy companies in various technology leadership positions.
“I’m honored to join the skilled technology team at LPL and a Fortune 500 company at the forefront of technology innovation in financial services,” Vyas said. “As we continue to grow and evolve, my focus will be on leading our efforts to streamline processes, mitigate risk and enhance the performance of our technology platforms.”
11. ACA Group Acquires Encore Compliance To Boost AI-Powered Oversight Capabilities
ACA Group – a provider of governance, risk and compliance (GRC) solutions to financial services firms – acquired Encore Compliance, which offers AI-powered solutions. ACA serves wealth managers, broker-dealers, private markets firms and other fund companies. It has a global team of 1,250 employees.
The goal is to enhance ACA’s Managed Services suite; add AI-enabled surveillance for expert network chaperoning and research calls; help asset managers and investment advisors to comply with regulations; enable research teams to create their own expert libraries; and identify potential risks in other voice communications that face heightened regulatory oversight.
“The acquisition of Encore Compliance represents a significant milestone for ACA Group,” said Patrick Olson, CEO of ACA Group. “This strategic move not only expands our suite of Managed Services but also underscores our dedication to integrating AI-driven solutions that enhance compliance and operational efficiency for our clients.”
Wirehouse / Big Bank Activity
12. Arete Wealth Taps BNY Pershing For Custody, Wove Platform And Alts Growth
Chicago-based Arete Wealth, a full-service broker-dealer and RIA with over $6 billion in AUM, expanded its clearing and multi-custodial wealth management platform through long-term clearing, custody and technology agreements with BNY Pershing.
The partnership gives Arete Wealth advisors access to Pershing’s Wove wealth management platform that includes Wove Investor, Wove Data and Wove Advisory’s Portfolio Solutions. Arete’s bespoke alternative investments platform features more than 60 offerings from dozens of sponsors including artwork, hedge funds, private equity, venture capital, real estate and more. Pershing plans to support Arete’s growth across these areas.
“We’re proud to be deepening our relationship with Arete Wealth, a firm whose focus on providing its advisors with the right resources to scale and serve clients matches our mission to help advisors help more people,” said Ben Harrison, Head of Wealth Solutions at BNY Pershing. “Their decision to use our Wove wealth management platform, along with the new suite of Wove products unveiled just last month, is a testament to the strong collaboration we’ve built over the years.”
Chris Latham, Managing Editor at Wealth Solutions Report, can be reached at clatham@wealthsolutionsreport.com.
