Revenue management platform PureFacts Financial Solutions is upending the old advisor argument of
What if a firm could use both models — and more?
The Toronto-based platform has expanded its technology from once being a fee-based revenue manager to a complete end-to-end revenue platform that can manage and detect different revenue streams, including advisor affiliates, and with the help of new AI tools.
PureFacts Chief Product Officer Jeff Marsden said it's no longer just about fee revenue but how to break down revenues based on the risk level of different asset classes and the entire life cycle of the client, which might include an annual "relationship" pricing — not just a fee or percentage based on a client's portfolio size.
"Fee-based isn't just about more consistent revenues. It's also an entire business strategy for how advisors work, how the pricing structure aligns better to the value that the advisors provide," he said. "But additionally, it's a means to better reflect the value of the relationships that the clients represent to the advisors."
PureFacts was founded in 1997. It just completed a major tech transformation with its 2023 acquisition of Xtiva Financial Systems, a sales performance and incentive compensation management system. The global platform has also expanded further into the U.S. through a recently announced partnership with portfolio management software provider Vestmark (out of Wakefield, Massachusetts), and an agreement with brokerage firm Capital Investment Companies in Raleigh, North Carolina.
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Name: PureFacts Financial Solutions
Website: purefacts.com
Size of PureFacts: The platform has 140 clients globally.
Products and services offered: PureFacts has three core products centered on helping firms manage their revenue: PureFees, PureRewards and PureInsights. PureFees is the core platform that helps asset managers calculate and collect fees, while PureRewards helps firms build and maintain compensation programs for sales associates. PureInsights is an overlay to the PureFacts platform, in that it uses machine learning and AI to provide predictive insights and reports for revenue management.
Who PureFacts aims to serve: Wealth managers, asset managers and asset services of most sizes.
What problems PureFacts wants to solve: At the heart of it, PureFacts' platform helps wealth managers, advisors and their affiliates calculate and collect fee revenues. This includes managing revenues from separately managed accounts, unified managed accounts, household fees and financial planning fees.
But Marsden added that "the magic comes" when the platform is used to find the "leakage" in various workflows and revenue streams, such as where to shorten timelines for when payments roll in.
"There are lots of little bits of leakage that happen for all of those firms. It can be in the form of leakage caused by dirty data. It can be leakage in the form of schedules that are out of date or that have small anomalies in them," he said. "It can be in the form of workflow that has choke points in it that prevents efficiency."
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How PureFacts is different from competitors: While there are wealthtech platforms that provide revenue management services, Marsden said PureFacts is "the only firm that is offering an end-to-end revenue management platform."
"We see revenue as something that should be managed through the life cycle, rather than explicitly a point-to-point problem or point solution," he said. "You can certainly do it that way — and we did it that way in the past — but the opportunity to drive real optimization means you should manage it across the life cycle."
What it costs: PureFacts does not have a specific pricing sheet on its website but Marsden said its "fees start in the low $100,000 range" based on the service and firm size.
What's next in development: Marsden said PureFacts is working on new developments, including with AI, to help firms identify new revenue streams and stop leakage.
Part of this includes new ways of looking at fee-based strategies as more service-based.
"We're thinking ahead and we have clients that are being more innovative about enabling and empowering advisors to do some things that are not commissions and not straight asset-based revenues," he said. "We can support a retainer or we can support hourly. … We can also support recurring program fees, so things like if I provide a financial planning service that's, say, $5,000 a year, in addition to all of the other things."
Part of that approach is to help the advisor generate business with that client throughout their investment life cycle, regardless of where the investments are held. For example, if the client's assets are tied up with business ownership that's currently not for sale, the advisor can continue to work with that client in other "service" ways to generate revenue.
"Advisors are thinking about: What are the different ways that I can ensure that the value I provide today is monetizable today and also reflects the value of what I'm trying to build with the client over time," he said.
