Trends in advisor technology

Trends in advisor technology

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Advisor technology is in the midst of a Big Bang: Investments in innovation have triggered an explosion of new products and services that have affected every corner of the financial services industry.

Since 2017, the number of applications built specifically for wealth managers has grown tenfold, from around 40 to almost 400. As inefficiencies crumbled beneath reconfigured and streamlined workflows—powered by advances in cloud-computing and a new generation of problem solvers—even the traditional categories for advisortech proved inadequate, and the number of verticals improved by recently developed solutions grew from 15 to more than 30, with numerous subcategories.

For broker-dealers, RIAs and large hybrids, this increase in available software options has been both a blessing and curse. From a home-office perspective, advisor-client interactions can now be measured and fine-tuned by directors and executives, providing opportunities for standardizing best practices and unlocking new potential.  But the increase in application usage has increased costs for support, training, and integration.

Client demand is another factor driving the advisortech revolution. A recent report found a 4% increase in daily wealth app usage by end clients, from 2020 to 2021. ​​Firms are also rolling out feature enhancements at a faster pace, with 75% of wealth management firms having made improvements to their apps, according to a recent J.D. Power survey.

Niche technology is a lush garden. From the seeds of financial planning sprouted specialized subcategories like estate planning, student loan planning, legacy planning, healthcare planning, and cash management optimization. The conveniences afforded by well-built customer relationship management (CRM) systems inspired automated client servicing tools, designed to make it easier to prepare for, and schedule, meetings. Even the weathered rootstock of traditional marketing has given way to the green shoots of digital marketing.

In fact, this thunderclap of innovation is most notable in three categories of advisor technology: specialized planning, automation, and digital marketing. The foundation under these pillars is advanced integrations, the crucial connective tissue that provides structure and reinforcement to advisors’ tech stacks.

To illustrate just how far advisortech has come in half a decade, I’ve selected a handful of companies representative of the evolution in this category. The list will include some firms that have been around for decades, as well as some of the newest vendors to provide services to the wealth management industry.

Specialized planning

By now, the advantages of establishing niches in financial advice have been well-established. Entrepreneur and industry observer Michael Kitces notes that advisors who target specialized client segments, such as physicians or divorcées make for better business efficiency and facilitate the potential to quickly scale advisors’ practices.

A 2020 compilation and analysis of industry surveys by Kitces found that financial professionals relying on specialization spent 28% more time with clients and prospects and 13% less time doing middle-office and back-office tasks, compared to their generalized counterparts. Additionally, specialists serve an average of 14% more clients and generate 20% higher standalone planning fees than their non-specialized colleagues.

The clients of advisors with niches have an average of 25% more investable assets and an overall higher net worth, according to the analysis. By serving wealthier clients, niche-focused advisors enjoy asset under management (AUM) fees that are 9% higher than those of generalized advisors, ultimately proving that there are “clear and measurable advantages (in both the short- and long-term) when opting to serve a niche clientele.”

Vendors have taken note, leading to massive growth in bespoke financial planning applications, such as estate planning.

Not long ago, advisors needing those solutions would turn to financial planning applications NaviPlan or eMoney Advisor. Until the mid-2010s, services provided by those two vendors largely met the market’s needs.

Sensing demand for specialized services, advisor technology market leader Envestnet backed a joint venture with estate planning startup Apprise Labs, started by eMoney founder Edmond Walters, eventually buying out Apprise Labs’ stake in the company and melding it into its own financial planning offering, Envestnet | MoneyGuide. Meanwhile, wealthtech veteran Steve Lockshin, an early investor in Betterment, launched his own fintech startup called Vanilla, to automate estate planning paperwork.

Even the sleepy world of cash management is now awake and innovating. Advisors wanting to capture wallet share can now turn to specialist firms, like MaxMyInterest, by StoneCastle and MassMutual’s Flourish Cash, to help clients squeeze basis points from their cash holdings. This application of technology, a novelty just a few years ago, has helped advisory firms earn the trust of clients, increased advisors’ own influence and assets under advisement, and given birth to a whole new subcategory of advisortech.


It’s not just Silicon Valley venture capitalists and cross-over entrepreneurs that have piloted this wealthtech evolution. Advisors themselves are active participants, applying advanced computing and machine learning to problems they’ve encountered in their own practices.

In 2019, two advisors launched tax planning software provider Holistiplan, which garnered industry attention after it won the XYPN fintech competition. Its founders recognized a use case for automation in the hundreds of hours they spent each year, poring over tax returns alongside accountants looking for tax planning opportunities.

What they found was remarkable: Almost 80% of the tax recommendations were the same, return after return. So they built a program to handle the repetitive tasks automatically, combining 1970s-era optical character recognition technology with cloud computing. The result is scalable and economical—and works wonderfully. Holistiplan is now integrated into the workflows of thousands of advisors.

Client meetings are another area where automation can help advisors to scale their practices.

In 2020, Pulse360 began automating client meeting preparation and organizing notes taken, producing automated meeting summaries and programmatically sending out follow-up messages. Data generated by client meetings is also shared and stored in the CRM.

It’s the type of impactful solution advisors didn’t know they needed, until they began using it. Automating a simple task—scheduling and notetaking—produced time savings of up to 75% for advisors using the tool.

Earlier this year, competitor Econiq emerged, offering a tool called The Conversation Hub, which is a visual-friendly medium for providing automated client meeting scheduling and reviews. Founded by banking executives, the tool is designed for videoconferencing and remote working.

At its core, the videoconference add-on facilitates client performance reporting and financial plan presentations. But the tool also comes with meeting templates that eliminate repeatable tasks, and all of the meeting items are automatically tracked, with a meeting report auto-generated and distributed to the client. Meetings are also analyzed using metrics that produce a “connection quality score,” linked to meeting type and advisor or team.

Digital marketing

Advisor-focused digital marketing is another emerging category in advisortech—not because digital marketing didn’t exist half a decade ago, but because advisors were generally so bad at marketing that they didn’t even know they needed to do it.

Outside of wealth management, digital marketing is one of the most saturated verticals, with more than 8,000 service providers and tools. Within the wealth management industry, however, it has only reached around  20 dedicated providers and tools.

The vertical’s early pioneers worked diligently to teach advisors the advantages of digital marketing, including how to use their software to manage it effectively. It was a big lift, but the work paid off as more advisors have turned to specialized solutions for marketing campaigns, marketing plans, and marketing content.

The proliferation of podcasts and an accelerating social media adoption rate provide additional tailwinds for digital marketers. Advisors can now turn to a variety of vendors to find anything from website hosting and design to podcast editing to turnkey content campaigns.

Bonus: Integrations

The pace of technological innovation shows no signs of slowing. Today, wide horizons can be found in integrations. With advisors cranking up their reliance on customization, they need to know which tools integrate with one another. A temperamental integration or dropped connection can create havoc for advisors, and inevitably, they seem to occur during the most high-leverage situations.

The importance of integration is directly linked to the proliferation of new tools. Years ago, financial planning tools like Envestnet | MoneyGuide and eMoney Advisor did the heavy lifting advisors demanded. They were joined by CRM firms, like Redtail Technology, and risk-metric providers, like Riskalyze, that seemed to integrate with every new tool that launched.

Today, owning a variety of integrations is table stakes for each and every vendor, especially as advisors continue to construct their own ecosystems.

It’s not just tech providers occupied with building the pipelines that move information between tools and systems. As a trusted industry partner, the analysts at Ezra Group built and launched their own rating system to measure application integrations, called The Ezra Group WealthTech Integration Score, to help firms navigate the increasingly thick web of inter-app connectivity.

The score is designed to provide a standardized methodology for comparing the capability of applications to integrate across categories and with the most popular software used by advisors.  The goal is to encourage more vendors to follow the lead of Envestnet and eMoney and build more integrations and make the information publicly available. This will eventually reduce the effort required to build wealth-management ecosystems using best-of-breed components and deliver a more seamless experience for advisors, home office, and clients.​​


The number of advisor technology providers available today vastly overshadows what was available even five years ago.

Older, generic software programs have been supplemented with applications designed for specific scenarios like estate, legacy, tax, and student loan planning, as well as solutions for optimizing cash management and certain healthcare situations. Advisors want to focus on specific points of friction for clients and need tailored tools to do so.

Automation has become table stakes for advisors, bringing advanced computing and cloud-based architecture to their desktops and mobile phones. While not new, the need for digital marketing technology has finally been recognized within the wealth management industry, leading to the minting of a new technology vertical. Like rebar in concrete, integrations are supporting the weight of innovation, providing both flexibility, scalability, and support.

Given the recent pace of innovation, it’s no surprise that we expect accelerated tech adoption among advisors.

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