Similar to how cell phone providers or cable companies have bundled services so users feel they're getting more bang for their buck, Fidelity Investments has taken two of its advisor platforms and created bundled offerings targeting smaller advisory firms.
The moves announced on August 5 include what Fidelity calls an all-in-one tech stack so RIAs can access the firm's brokerage platform Wealthscape, the financial planning services of eMoney, and Advyzon's operational and portfolio management software — all in a bundled pricing. The bundling concept is meant to provide a lower-cost option for small- to midsize firms without having to jump around to various platforms with different costs.
"One of the things that's really challenging, particularly for smaller advisors, is to really understand how to put a good tech stack together that's fully integrated," said Noni Robinson, head of emerging RIAs at Fidelity Institutional Wealth Management Services.
Fidelity Institutional Wealth Management Services is a division of Fidelity Investments that provides the platform for clearing and custody services.
Robinson said the all-in-one platform was developed for advisor clients who'd asked for "an easy button" that would help them run their day-to-day operations, and for the "breakaway advisor" starting their own business and needing a full-suite of tech to get started.
"That's essentially what the first all-in-one bundle is intended to do," she said. "It's bringing together the package, if you will, to say to the new breakaway advisor, 'Here's basically everything you need to run your new RIA.'"
There has been a greater push for providers to offer all-in-one capabilities on a single platform. For instance, within the unified managed account space, the percentage of platform sponsors who reported moving to a single platform architecture more than doubled from 14% in 2020 to 30% this year, according to a recent report by Cerulli Associates.
READ MORE:
"Historically, the biggest challenge has been a 'jack of all trades, master of none' perception, but multiple industry studies have shown that the individual feature sets within Advyzon stand up to the competition on their own," John Mackowiak, chief revenue officer of Advyzon. "For small and midsize firms in particular, there are often less stakeholders involved in these decisions, so things tend to move a little faster."
Last month, RIA custodian TradePMR said it was integrating with Advyzon's platform so advisors can streamline their workflows with a single sign-on capability and direct access to client documents, billing and trade orders. And Asset-Map, a digital tool for portfolio management, joined tax-planning software provider Holistiplan in June to offer more tax services through a single sign-on platform.
Most of the movement aims to streamline advisors' workflows and lower operating costs.
READ MORE:
"We're offering an unprecedented discount program, as well as an enhanced service model to participating firms," Mackowiak said in speaking about the partnership with Fidelity. "We worked closely with the team at Fidelity to identify and eliminate some of the hurdles we've seen over the years as firms consider independence."
Fidelity also released a second type of advisory bundle that includes Wealthscape, eMoney and a newly launched Fidelity Managed Account Xchange Essentials (FMAX Essentials) that includes a quarter of the investment options offered on its larger FMAX platform. The smaller
FMAX Essentials investment menu includes some mutual funds and exchange-traded funds (ETFs), model portfolios, separately managed accounts (SMAs) and UMAs.
Currently, FMAX Essentials is only available to firms that custody with Fidelity. But Fidelity said it plans to introduce additional features and investment options over time.
"Those components put together are really to help advisors grow their practice," Robinson said. "They're looking for more sophisticated, managed account solutions."
