The role of financial adviser has changed. What should WealthTechs offer them now?
Interview with Sean Brown,
President and Chief Executive Officer at YCharts
“The advent of model portfolios is creating disruption in the wealth management space.” This statement belongs to Sean Brown, President and Chief Executive Officer at YCharts, a growth company in the WealthTech space that provides a web-based investment research platform with unique visualizations, extensive data on equities, mutual funds, ETFs, and economic indicators, and tools that enable better client communications. He says that forward-thinking wealth management technology companies are helping advisers conceptualize, create and manage standardized portfolios in order to both scale their operations and provide better investment management advice.
More templates, more guides
Advisers want to solve their problems in a few clicks. Such things as visuals, guides, and improved charting capabilities help them to do their work more efficiently. Providing an adviser with powerful capabilities enables them to provide better prospect and customer support. As an example, Sean outlines the partnership between Seeking Alpha and YCharts.
“Seeking Alpha contributors have access to YCharts to quickly create a visual element and snap that into their post to better relay metrics and insights to their readers.”
The whole new world around model portfolios suggests that it might make sense to an adviser to integrate between portfolio accounting systems and research tools. However, doing so requires a pragmatic approach when deciding if it makes sense.
“We want to create a fluid workflow for advisers: start in the portfolio accounting system, take it to YCharts to further research, visualize or compare against another model portfolio, incorporate what you’ve learned into the portfolio then push it back to the accounting system.”
Stay in your lane
Sean and his team at YCharts prefer to stick with a pie slice that they feel very good about, namely, analysis and visualization. They aim to enable advisers to incorporate visuals that help them better tell their stories.
“We’re hearing two things from advisors. One is, ‘I need to justify my fees’. The best way to do that is by being able to demonstrate alpha in their investment approach. Two is they’re saying, ‘Hey, I need to get more clients, I need to step up my marketing, thought leadership and communications to gain new clients, but I’m pinched for time.’”
With the number of hats they wear on any given day, advisers struggle to find an extra hour or two in the week to better communicate with their current clients and bring in new ones. What WealthTech companies really do is help them save them a couple of hours per week through the combined services they offer. Companies like YCharts help advisers communicate with clients more efficiently, which saves them time for other priorities. And, as we all know, there’s hardly anything more valuable than time.
These two types of benefits–insights for smarter decisions and time management–will be able to justify advisers’ fees and help WealthTech companies stand out from the competition.
The fee compression in wealth management is a problem for everyone who’s operating in that area. The way the tech companies can deliver value is by helping advisers justify their fees and save time for satisfying their clients and growing their businesses. The best way to do it, as Sean says, is to remain a leader in what you do and focus on improving your service to meet the needs of your clients.
Sean Brown has worked in various roles in the software and financial services industries. Prior to joining YCharts in 2016, Sean Brown led a division at ICE Data Services (formerly Interactive Data) called 7ticks, which was an IaaS provider for low-latency trading networks and software.
Interviewed by Vasyl Soloshchuk, CEO and co-owner at INSART, FinTech engineering company. Vasyl is also the author of WealthTech Club, which conducts research into Fortune and Startup Robo-advisor and Wealth Management companies in terms of the technology ecosystem.