Competition ignites major Orion restructuring

NorthStar Financial, the parent company of Orion Advisor Services, announced a major restructuring intended to align its subsidiaries and take on some of its larger competitors.

The new parent company — now called Orion Advisor Solutions — will encompass Orion Advisor Services, the newly acquired turnkey asset management platform FTJ FundChoice and asset manager CLS Investments and Constellation Trust Company, according to a release. The move is meant to streamline corporate strategies and create cohesion among products and services, the release says.

The move also gives the public a clearer picture of Orion’s business model and capitalizes on its significant brand equity in the industry, says CEO Eric Clarke, who will also head Orion Advisor Solutions. The changes are expected to be finalized in September.

Under the new parent company, Orion Advisor Services will be renamed Orion Advisor Tech and FTJ FundChoice will become Orion Portfolio Solutions, according to the release. Although the companies will continue to operate independently, Dean Cook and Ryan Beach will lead Orion Portfolio Solutions as CEO and President. Rusty Vanneman will serve as President of CLS Investments.

“The rebranding allows us to get the message out,” Clarke says. “This allows us to compete for the enterprise business.”

Last year, the company acquired open-architecture TAMP FTJ FundChoice — an Orion client and partner for more than a decade — to expand its presence among RIAs and broker-dealers. CEO Cook says the new business structure will add additional tools for the advisors on its TAMP network like Orion’s trading platform Eclipse and its tax optimization tool ASTRO.

“It takes a next level of thinking to get advisor technology to work for a TAMP and at a larger scale,” Cook says. “It’s become extremely valuable to optimize tax efficiency at the household level as well as portfolio rebalancing.”

The move comes on the heels of a recent restructuring at one of Orion’s biggest competitors. Envestnet, the largest TAMP by assets at well over $400 billion, streamlined its business units into two distinct segments in January. Envestnet Wealth Solutions offers advisor technology through Tamarac and Data & Analytics focuses on data aggregation through Yodlee.

Envestnet has more than six times the assets of its nearest competitor in its core asset management platform business. Tamarac — the firm’s rebalancing, reporting and practice management software powerhouse that is now folded under the wealth management arm — has $1.2 trillion in combined assets under management and services over 1,000 RIAs, according to the company.

Competing with Envestnet is squarely in the sights of the executive team at Orion. “We have a lot of great competitors that we look at, and honestly there is a lot to admire,” Clarke says. “Instead of going to customers with a series of products from different brands, its simplifying our message in the marketplace. It's easier for advisors to do business with us.”