Enterprise Wealth Management with MyVest: Successful Business with a Human Touch

Website myvest.com
Established 2001
Clients Broker-dealers, banks, large RIAs, service providers
Value Proposition Enterprise wealth management for the digital age

We continue our deep dive into innovative WealthTech companies that are disrupting the landscape and bringing more innovation to the market. This time we spoke with the team at MyVest, a FinTech trailblazer that is utilizing the power of technology and applying industry lessons learnt to create its daring offerings.

What long-term strategies led this well-established company to its present-day success? Why aren’t integrations the company’s first choice when it comes to business growth? How does MyVest juggle requirements from multiple clients to incorporate the best ideas into its product roadmap? We covered these and other topics during our dialogue with the firm’s top management.

MyVest at a glance

MyVest is headquartered in downtown San Francisco, in close proximity to Mission Street and the heart of the financial district. The company is the next-door neighbor of the West Coast branch of BlackRock, a well-known asset management and financial planning corporation.

I came to see Anton Honikman (CEO), Brian Marchiel (VP Product), and Ashley Walley (Marketing Manager) at their office premises. Before embarking on our journey, we spoke to the PR agency who works on MyVest’s communications—Boston-based BackBay Communications, a company that is renowned in FinTech circles.

MyVest Office

MyVest is an international team of like-minded people who are passionate about bringing technology to serve the evolving needs of larger communities and putting digital technology to use to generate more wealth for its end users.

At the helm of MyVest

MyVest Anton HonikmanAnton Honikman, CEO of MyVest, has been with the company for five years. Throughout his career, Anton has worked either in financial technology or investment management at places like Barclays Global Investors (now BlackRock) and Barra, Inc. (now MSCI), and has also had a lot of exposure to venture capital opportunities in the wealth management space. In addition, Anton co-managed a startup ESG-centric investment management firm.

MyVest Brian MarchielMyVest’s VP of product management, Brian Marchiel, has been with the company since 2010. He is responsible for strategic planning and envisions further development of the company’s offerings. Brian has a biomedical degree from Duke University and an MBA in finance from University of California, Berkeley; he is currently pursuing CFP training at Boston University. Prior to joining MyVest, Brian worked in investment banking and was a senior project manager at an enterprise software development firm.

MyVest Charlie HaimsCharlie Haims, MyVest’s VP of marketing, has experience with early-stage startups as well as large banking institutions. He has worked on innovation for a number of companies, including DLJdirect, E*Trade, Charles Schwab Bank, Financial Engines, and Prosper Marketplace. Charlie has bachelor’s degree in economics from University of California, Berkeley, and an MBA from Yale School of Management.

MyVest Mark WorseyMark Worsey is COO of MyVest. He has a diverse set of experiences across industries and leadership roles. Mark started his career in the consulting world with Accenture driving multi-year, large scale system implementation projects. This experience advantaged subsequent positions where he broadly ran engineering and technology at Netscape (IPO & acquired by AOL), Xign (acquired by JPMorgan), Blackhawk (IPO), and GoGrid (acquired by DataPipe).  These days, at MyVest Mark is in charge of software engineering, technical operations, middle office operations, as well as security and customer support. Mark has a bachelor of science in computer science from Purdue University.

MyVest’s offering: What makes it stand out?

“Most of the enterprise wealth management solutions have focused on what I regard as the ‘orthodoxy’ of our industry.” (Anton Honikman)

Anton Honikman states that the classic industry approach to wealth management is product-centric, and is generally focused on selecting third-party managers and making them available in a single account to investors. This is where MyVest has something different to offer:

  • The investment journey begins with the customer in mind. In other words, MyVest adds personalization to portfolios and “tax manages” them throughout its enterprise wealth management platform.
  • The ultimate focus of MyVest is the investor, for whom the tech company enables advisors to build customized portfolios that are holistic, personalized, and tax-managed. Only after an advisor has made the strategic portfolio decisions does the technological aspect come into play through implementation across their entire book of business to help firms scale their offerings.
  • To enable holistic portfolios, MyVest engineered a unique household-based data model that enables multiple accounts across a household to be coordinated into an overarching investment strategy aligned with one or more goals.
  • For tax management, they offer more than just simple rebalancing when their system optimizes the balance between risk, personalizations, and tax impact. Tax management includes proactively harvesting losses, smart deferral of gains, facilitating best-tax lot relief, and optimizing asset location, providing advisors an easy way to manage the inherent trade-off between improving tracking error and reducing taxes.
  • MyVest captures and automatically enforces client restrictions and recurring instructions on a daily basis. This gives firms the ability to scale their portfolio management process while personalizing each portfolio.
  • When it comes to risk estimates, MyVest serves as a “container” for its sponsor’s risk-profiling and risk-scoring algorithms.
  • The additional strength of MyVest is the ability for a user to customize the asset allocation strategies for each individual investor. Highly configurable investment strategy can come at different levels—asset allocation, security recommendations, drift tolerance, etc.—making MyVest a robust personalization engine that offers plenty of options for customization in different dimensions.
  • They achieve all of this in an enterprise platform that includes client proposals & onboarding, investment strategy and model management, tax-aware portfolio management, monitoring & rebalancing, order management & trading, performance reporting & billing, and an investor portal and advisor dashboard. The platform also allows enterprise firms to support all of their client segments and channels on a single technology infrastructure.

“We generate tax alpha in multiple different ways. Proactive tax loss harvesting is one of them, intelligent gains deferral, asset location, best tax lot relief, plus more.” (Anton Honikman)

Although it has some key integrations, like Eagle’s portfolio accounting engine, the SunGard Transaction Network, multiple custodians, and Morningstar and others for data, MyVest is very selective with pre-integrating with its peers.  Instead, customer demand drives most integrations for things like CRM and financial planning. It has a broad set of web services built on its REST API to allow integration with its customers systems and their preferred applications.

MyVest is owned by TIAA, a leading provider of financial services in the academic, research, medical, cultural and government fields.

Software development and product management

MyVest uses an Agile software development process and deploys on the basis of more discreet waterfall events, because its customers are regulated financial institutions with their own acceptance processes that deployments have to go through.

Team structure & development process

The software development process is well laid out, with the company’s technical workforce being organized into a series of multi-functional program teams, such as investment-management applications, advisor-facing functionality, and operational features, while a platform engineering team is in charge of the infrastructure stack. While the teams work on different areas, each applies consistent best practices.

MyVest Team

At MyVest, there is a tradition of continuous evaluation and staff-performance monitoring. The company’s philosophy is that you can only control what you can measure, and keeping an eye on how things evolve is a great way to make sure you’re moving in the right direction, aligned with set goals. Daily stand-ups and two-week iterations are part of the software development process at MyVest, a modern Agile environment that resonates with the tech talent in the San Francisco Bay Area.

Software: How it’s made

The MyVest platform was in development for over a decade. It continues to evolve, and is thus very up-to-date in terms of applying current technologies, which allows the company to remain a market leader. The core technologies that the company uses begin with a foundation of Java, Oracle, and Linux. Then database components like Redis and Cassandra support massive scale and the performance benefits of in-memory data access.  Middle- to back-end components include the Spring framework, Hibernate, and reactive programming and streaming technology for optimal processing performance.  A powerful front-end framework is driven by AngularJS to extend JavaScript and HTML5 capabilities.  Finally, they have a broad set of web services using a REST API make it easy to interface with other applications.

Mark Worsey, the company’s COO and EVP of Technology, feels that there is a direct relation between the technologies at the core of the platform and the local resource pool:

“Those types of technologies take a unique set of skills and the talent pool here in San Francisco is a great match, so that’s advantageous to us.” (Mark Worsey)

The application MyVest has created is architected in a microservice style. This approach is essential to allow for independence between different teams: the team working on core data layer access has autonomy in terms of how they build and develop, as does the team working on advisory UI components, and the team that’s working on core batch architecture processes, such as account reconciliation and tax rebalancing and optimization.

“We applied a microservices strategy that has enabled us to structure our development and teams around core functional competencies.” (Mark Worsey)

This program team structure allows for a smooth workflow and a certain degree of autonomy, as well as rapid movement through the development cycle. This kind of team structuring is very similar to the one we describe in our FinTech Engineering Approach, where each cross-functional team is structured in such a way as to own and be responsible for one or a group of microservices within the overall system architecture:

team

MyVest uses the following common and powerful tools for the CI/CD process:

  • GitHub as a source code management repository utilized for code reviews and progression of code.
  • Jenkins for continuous integration and nightly builds.
  • Fully automated regression test suites, so that every night when the application is rebuilt it runs through all regressions automatically.
  • Dockerized” and “containerized” application to facilitate rapid deployments into new environments, utilizing Liquibase to manage the data layer in the Oracle database version management, as well as data and attributes that are essential to setting up new environments.

An additional part of the program team at MyVest is called the platform engineering team, which is a kind of DevOps team that reinvents the tools and the technology and fits them within the application architecture framework. The team is in charge of making development and deployment of the framework more efficient.

“If you think about our platform and the nature of our business, we actually have to build and then deploy to isolated instances of the MyVest wealth management platform, on a per-client basis.” (Mark Worsey)

On top of all that, there are individual instances of production environments for customers. Some of the preproduction and production environments reside in an on-premises or a proprietary data center within its own hardware stack, under the sole control of MyVest, while others are deployed and run as live instances and production instances in the cloud, using services like AWS.

There are several reasons for this arrangement:

  • It blends well with the entire method of containerization and the microservices strategy;
  • Since there is a necessity to architect this large, complex application stack and functionality, there is a need for dynamic control to activate or deactivate certain features on per-environment or per-customer bases.

This makes a lot of sense, since everything should be controllable through “on/off switches,” so that one single unified code can be built and operated holistically and later deployed into multiple customer environments:

“What used to take us weeks, or almost a month to build out a new environment and to put all the components of our stack in place for a new environment, now takes just hours to complete.” (Mark Worsey)

Re-engineering: Dealing with legacy

Ten years ago, the application stack was certainly much more monolithic. MyVest had a fairly large application due to the technology strategies common at the time. By shifting an isolated piece of the application stack to a microservice architecture, the company began to realize the benefits of accelerating new feature development and isolating regression issue impacts.

The idea of re-engineering was to write the layers of isolation and segment the methods more granularly, so that they could interface with each other, as opposed to having one giant monolithic build.

“We started this in a complex part of our platform, our portfolio optimization engine, and that drove some great learnings within the team.” (Mark Worsey)

MyVest put a lot of effort into not only remodeling the engine, but educating the development team at large. The company assembled skilled architects with years of experience, next to the small program teams working on those microservices. Although this initially seemed like a huge challenge in terms of setting the “microservices mindset” among the teams, it bore fruit in the long run.

Every day, the technical team brainstorms on upcoming commitments and the forecasted product strategy to decide what needs to get to market and when exactly to take that step. This thought process is in sync with customer-facing and revenue-generating aspects when it comes to legacy architecture that needs to be re-engineered:

“How we refactor our application to keep us current and competent, while at the same time delivering customer-facing new IP that differentiates in the market is an ongoing balancing act — part science and part art.” (Mark Worsey)

Agile with a pinch of Waterfall

MyVest adopts best practices from Agile development processes where relevant. At the same time, there are still “waterfall-ish” influences driven by their customers’ acceptance protocols, so the company uses a combination of approaches that work in sync. MyVest conducts thorough sprint planning with classical two-week sprints, along with daily Scrum stand-ups.

 “We’ve got rules around how we think about the number of story points for a particular feature and its technical complexity, as well as what areas of the application it touches that allow us to accurately assess our development backlog.” (Mark Worsey)

The backlog of new features is translated into their own capacity planning tool and is refined each week by evaluating the development of features that are in flight. This helps with the overall health of sprint execution and with keeping an eye on the time for a particular feature to be ready.

“So we continuously have a hypothetical forecast, which is usually a full year, based on key features and the capacity of the team.” (Mark Worsey)

Data security

As an autonomous subsidiary of TIAA, a regulated financial institution, MyVest has invested in heightening its data security standards. Internally, the company’s corporate policies and procedures are documented, tested, and verified on a regular basis, and it has audited SOC2 (Type 2) compliance in place.

Security for MyVest’s platform starts with strict access and authentication rules around how other application components can access data, and how those assets are secured. In addition, the company spent a lot of time to progress to an internal info security policy around how data is used, where it resides, and how it is to be managed. The same is true for backups for disaster recovery from a business continuity perspective. Thus, there are a number of very strong technical controls around those areas. When it comes to user access to the data itself, MyVest has built a unique set of roles in the application, which are very distinct and configurable:

“We built an entitlement feature into our product, so that unique and distinct roles can be established.” (Mark Worsey)

Challenges on the way

The biggest challenges for MyVest nowadays are making certain customers comfortable with legacy platform replacement, a requirement to future-proofing their technology and business.  When it comes to technology, the biggest challenge is getting them comfortable with deploying the application in their production instances in the cloud.

“Sometimes there is an emotional or irrational security fear of running a financial application in the cloud.” (Mark Worsey)

Mark feels that running everything in the cloud is a huge advantage, as it enables horizontally scaling in real-time, making the deployment process so much easier and more cost-effective compared to the capital-intense methods of building data centers and acquiring hardware.

When it comes to business practices, the biggest challenge is getting them comfortable with moving their firms towards new client-centric practices like offering advice that is holistic, personalized and tax-optimized, and to use technology to do this at scale.

WealthTech Club takeaway

MyVest has built a strong foundation that allows it to steadily move forward and tackle the challenges of the modern digitalized world. The company has no silent partners—people who put their money in the firm and simply let the stakes grow—they all keep a finger on the pulse and foresee the direction MyVest is heading.

Backed by TIAA, a top-level provider of financial services, along with solid technological expertise, MyVest has all the cards it needs to take its already successful client-centric wealth management solution to new heights.

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