Welcome to the November 2023 issue of the Latest News in Financial #AdvisorTech – where we look at the big news, announcements, and underlying trends and developments that are emerging in the world of technology solutions for financial advisors!
This month’s edition kicks off with the news that Practice Intel has launched a new “growth platform” centered around quantifying the quality of an advisor’s client relationships with an all-in “Relationship Quality Index” (RQI) – which while potentially valuable in helping advisors understand and improve their client experience (and subsequently improve client retention and boost the lifetime value of each client), also raises questions about whether advisors will be willing to invest in tools to improve their client experience given their already-high average client retention rates, as well as what really is the ‘best’ metric for measuring satisfaction in the first place, since other platforms also purport to quantify customer satisfaction (some of which are notably less costly than Practice Intel’s suite of practice management tools).
From there, the latest highlights also feature a number of other interesting advisor technology announcements, including:
- FinanceHQ has launched as a new digital lead generation platform for financial advisors, which takes a more niche-focused approach to matching prospective clients with advisors – representing a bet that capturing prospects seeking help for specific problems (whom it can then refer to an advisor specializing in that problem) will reduce the costs of bringing on new clients and help it grow and scale among a crowded market for lead generation services
- Technology-focused RIA startup Farther has announced a $31 million Series B funding round at a whopping $131 million valuation – which while reflective of its rapid growth in assets and revenue in recent years, also raises questions about whether its innovative technology offering will really create enough value to fulfill its investors’ expectations, or if it will need to instead focus on simply bringing in more advisors to justify its valuation
- Fidelity has stopped giving ‘screen-scraping’ data aggregators access to its client information, requiring them instead to go through its sanctioned direct data feed – which, while done in the name of ensuring more stable data connections and better account security, also highlights the business opportunity for data platforms and institutions that own and provide access to client data
Read the analysis about these announcements in this month’s column, and a discussion of more trends in advisor technology, including:
- 2 new AI-driven compliance technology solutions, Avery and Hadrius, have launched – which, on the one hand could represent a significant step forward in automating and streamlining the time-consuming, repeatable processes of following compliance procedures; but on the other, raises questions about whether AI technology itself is really ready yet for the highly technical, low-margin-for-error domain of compliance
- Morgan Stanley has introduced a new AI tool for its 16,000 wealth management advisors, which notably doesn’t give financial advice – but does create the potential to streamline advisor processes from investment research to meeting follow-ups and even possibly generating potential planning ideas.
And be certain to read to the end, where we have provided an update to our popular “Financial AdvisorTech Solutions Map” (and also added the changes to our AdvisorTech Directory) as well!
*And for #AdvisorTech companies who want to submit their tech announcements for consideration in future issues, please submit to TechNews@kitces.com!