I’m here is sunny Chicago, enjoying the unusually nice weather, deep dish pizza and Goose Island beer, while attending the Envestnet Advisor Summit 2015. This is a quick overview of some of the key information presented during the first day of conference.
Follow us on Twitter to get live updates from the next two days of speakers, sessions and panels. Keynote speaker on Friday will be Mike Krzyzewski, men’s basketball coach, Duke University, who recently won his 5th NCAA championship.
Overview of ENV 2 Integrations
Don Bart, VP Product Management, Envestnet, reviewed the latest updates to their functionality for exchanging data with third party software programs including financial planning, CRM and custodians.
Currently, the data exchange with all financial planning tools and ENV2 requires manual interaction. Namely, file imports or clicking individual clients to move their information between applications. In their upcoming release in August, Envestnet plans to reduce the number of clicks required for advisors to connect data between eMoney and ENV2. (See FinPlan Shootout: eMoney Advisor versus MoneyGuidePro)
Envestnet planning tighter integration w/ @eMoneyAdvisor for proposals & reports #ENVSummit
They are also working to provide what Bart called on-demand client account importing from ENV2 to MGP.
Envestnet working on API on demand client account import from ENV2 to @MoneyGuidePro #ENVSummit
The third financial planning software that Bart mentioned was Finance Logix. I noted that the level of connectivity seemed minimal when compared to the other two, much larger players in the space. But after yesterday’s announcement that Envestnet is acquiring Finance Logix in a deal worth around $32 million, I would expect much tighter integration to be delivered in the next 12-18 months. (See Which Financial Planning Software is Right For You?)
Envestnet acquires #financialplanning software vendor @financelogix #ENVSummit
This part was a bit confusing. Of course, ENV2 supports multiple custodians already, but Envestnet is planning additional connectivity for useability, exchanging client data, account alerts, reports, and intra-day balances positions transfers, according to Bart.
Envestnet to offer enhanced integration by year-end w/ @TDA4advisors @CharlesSchwab @FidelityAdvisor #ENVSummit
Envestnet built a very useful mobile app for this event. Having attended many conferences and tried a lot of conference apps, this one was definitely the best design and functionality I have seen. The online polling worked very well and they used it to gather some statistics from the attendees.
Envestnet #ENVSummit #financialplanning users breakdown: 39% @eMoneyAdvisor 31% @MoneyGuidePro 23% Other
Welcome Address from the CEO
Jud Bergman, Envestnet’s Chairman and CEO used his presentation to gave us a history lesson on an entrepreneur named James Hill, who built a railroad network from St. Paul, Minnesota to Seattle, Washington in the late 1800’s. Hill only had a ninth grade education, yet built an empire that spanned half the country and was worth over $60 million (around $1.7 billion in 2014 dollars).
At #ENVSummit Jud Bergman uses challenges of transcontinental railroad building as metaphor for robo advisors
Bergman also related the tremendous benefits that a transcontinental railroad provided to the US economy since it allows raw materials to be delivered to industries and for finished goods to then be delivered to consumers.
The value of Envestnet’s network is proportional to square of number of connected users -JudBergman #ENVSummit
Envestnet’s research has shown that advisors can provide 300 bps of added value to client portfolio performance. This can be accomplished if the advisor delivers services such as financial planning, asset selection and allocation, investment selection, rebalancing and tax management (the biggest contributor at 100 bps).
ENVSummit CEO Bergman talks about 3% value add of Capital Sigma…Fin planning, asset allocation, beyond beta…
Their acquisition of Placemark Investments last year more than doubled their UMA assets and added to their already massive number of money managers on their platform. (See Envestnet buys UMA Experts Placemark Investments for $66 Million)
Envestnet is now largest non-wirehouse #UMA provider -JudBergman #ENVSummit
Another reason why Envestnet bought Upside Advisors. (See Why Demographic Differences Define How Advisors Should Talk to Clients)
77% of HNW Millennials do most or all of #wealthmanagement business digitally -JudBergman #ENVSummit
Jud Bergman at #ENVSummit to advisors: Envestnet will help you ‘bridge the digital divide’
Market Outlook Panel
- Zachary Karabell, Head of Global Strategy, Envestnet, Inc.
- Larry Adam, Chief Investment Strategist, Deutsche Asset Management
- Heidi Richardson, Global Investment Strategist, BlackRock
Technology is one of the most attractive sectors in valuation terms -HeidiRichardson @BlackRock #ENVSummit
Zach Karabell at #ENVSummit: more risk in safety (read: bonds); more safety in risk (read: stocks) #ENVEngage
VIX low = risk not priced into market = small news could increase volatility -HeidiRichardson @BlackRock #ENVSummit
Can Chinese government engineer transition to consumer driven economy? @zacharykarabell #ENVSummit
Higher interest rates = economic growth = not bad for REITs in long run -LarryAdams #ENVSummit @Deutsche_EN
1 million new brokerage accounts being opened each week in China”- Ron Insana. #ENVSummit
Now is the time to get into international hedged investments -LarryAdams #ENVSummit @Deutsche_EN
Envestnet Buys Finance Logix
Right in the middle of the presentation by Dr. Brian Green (below), I received an email from Envestnet’s PR firm that they had acquired the financial planning vendor, Finance Logix. If you have a minute, check out this well-written analysis of the deal by Michael Kitces.
Envestnet acquires #financialplanning software vendor @financelogix #ENVSummit
Envestnet will integrate @financelogix into @tamaracinc client portal -StuartDePina #ENVSummit
The Drive to Innovate: Stories from the Frontiers of Discovery
If you’re willing to press into the unknown & let math guide you, you come to spectacular conclusions.” #ENVSummit
Einstein thought, “ask the questions a 5 year old would ask”. @bgreene at #ENVSummit
Tamarac Advisor Xi Keynote Address
ENVSummit Fantastic vision but can they really pull it off? Integrating platforms and making it work is TOUGH.
By 2020, 2/3 of HNW investors will add a digital investment component -StuartDePina #ENVSummit
Ryan Neal, a reporter for WealthManagement.com, for some reason, decided to pick a Twitter fight about advisor technology with Michael Kitces, publisher of the blog Nerd’s Eye View and one of the industry’s leading experts on financial planning and advisor technology. Not a great idea. Without reproducing the entire conversation, let’s just say that Kitces schooled him.
DePina asks, “does anyone in this room NOT want this functionality?” #ENVSummit
Tamarac has 800 clients, 4,000 advisors, 1.1 million accounts, $500 billion in AUA -StuartDePina #ENVSummit
Everyone seemed to like the pictures I chose to go along with my tweets.
Advisors must balance profitability of different client relationships vs #roboadvisors -StuartDePina #ENVSummit
Envestnet will extend functionality for clients to run automated advice solutions -StuartDePina #ENVSummit
@ryanWneal Vanguard NOT a robo-advisor. They’re human advice platform, happen to meet w/ clients virtually. Like many other RIAs. #ENVSummit
Ron Fiske mentioned that a suggestion was made after last year’s summit to include more technology partners. So Envestnet built a technology pavilion area just to showcase them.
ENVSummit #ENVEngage at the Pavilion.
I didn’t get a limo ride to dinner, but it looks like some clients were getting the royal treatment.
Riding in style to the #QP dinner. #ENVSummit