First Trust Capital Partners acquires direct indexing firm Veriti Management: Wealthtech weekly

July 8, 2022 1:59 PM

A direct indexing asset management and financial technology company with more than $1 billion in AUM is set to be acquired by First Trust Capital Partners by the end of the month.

First Trust, one of the world’s largest asset managers with more than $203 billion in assets, has announced its plans to acquire Veriti Management.

Built by advisors for advisors to provide direct indexing solutions to institutions and wealth management firms, officials say Veriti’s approach to asset management focuses on delivering advisors scalable strategies for driving tax-advantaged returns and deep customization for individual investors.

Terms of the deal have not been disclosed. The acquisition is expected to close on July 31.

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“Customization through direct indexing empowers the advisor to deliver personalized and tax-advantaged solutions that better align with the investment objectives, values and interests of their clients,” Ryan Issakainen, senior vice president and ETF strategist for First Trust Advisors, said in a statement. “We are delighted to begin this partnership with the Veriti team and look forward to working together to service the advisor community.”

Veriti looks to streamline tasks and minimize the time required to create fully customized equity portfolios focused on tax efficiency and responsible investing.

Veriti co-founder and Managing Partner Jim Dilworth said the company is excited to enable First Trust as it helps wealth management firms better align client portfolios with their values while providing personalization

“Veriti, teamed with a renowned ETF provider and asset management leader in First Trust, will empower advisors and institutions to address their clients’ investing preferences at a far deeper, more personalized level,” Dilworth said.

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Envestnet announces acquisition of Redi2 Technologies

Envestnet announced this week that it has acquired revenue management and hosted fee-billing solutions provider Redi2 Technologies.

Officials say the deal creates more connections across the Envestnet financial wellness ecosystem for asset managers, wealth managers and RIAs. Terms of the acquisition have not been disclosed.

"Redi2 is a pioneer and innovator in the cloud-based delivery of wealth and investment management billing software, making them an ideal partner as we continue to strengthen our financial wellness ecosystem," Tom Sipp, executive vice president of business lines for Envestnet said in a statement. "With Redi2's solutions, we become the industry-leading provider of revenue and billing tools needed by all industry constituents — including advisors, wealth firms and asset managers.

“This acquisition enhances our strategic enablement of service and data, and over the next two years will create operating leverage by bringing Envestnet and Redi2's administrative, revenue and billing services together."

Redi2's platform enables fee calculation, invoice creation, payouts and accounting, and billing compliance. Fermin Garcia, president and COO of Redi2 Technologies, said the company has spent the past two decades developing the platform to help asset and wealth managers of all sizes tackle “complex billing requirements and revenue collection workflows within an intelligently designed digital platform.”

"We are tremendously excited about becoming part of the Envestnet ecosystem and joining forces with their talent, technology platform and capabilities to provide asset and wealth managers with greater power to monetize their billing and payment volumes for the benefit of their firms and their clients," Garcia said.

Income Lab wraps beta testing, launches interactive retirement planning tool for advisors

Following a six-month beta test that relied on the feedback of more than 200 advisors, solutions provider Income Laboratory has rolled out its next-generation retirement planning software.

Billed as the “only tool that seamlessly integrates dynamic retirement income plans and tax-smart distribution plans,” Life Hub is an interactive tool for financial advisors that gives clients a detailed visualization of their financial lives on one page.

Viewable at any level of detail and at any point in time, advisors can use Income Lab to build and monitor dynamic retirement income plans that help retirees adjust for evolving economic and market conditions and make tax-smart distribution decisions.

"Life Hub is truly a game-changer for financial advisors," Johnny Poulsen, co-founder and CEO of the Denver-based Income Lab, said in a statement. "Life Hub offers a new way for advisors to build, present and update retirement plans for their clients. It helps eliminate pain points stemming from disjointed planning and the need to navigate complex sets of screens to find plan details."

Income Lab's software monitors retirement plans monthly to see whether circumstances have changed sufficiently to warrant modifications and then notifies advisors who can discuss adjustments with clients.

The Life Hub software is currently included as part of the Income Lab retirement planning software available to advisors at rates ranging from $159 per month for a single advisor to $139 per month for large teams of advisors.

CFP Derek Tharp, assistant professor of finance at Southern Maine University and lead researcher at Kitces.com, serves as a senior advisor to Income Lab. He called Life Hub a welcome innovation that helps advisors build more realistic and adaptable financial plans for their clients.

"Better tools for advisors lead to more clarity and security for clients, showing how their retirement plans can weather different scenarios," Tharp said.