Until a decade ago, technology for the independent RIA sector was primarily a cottage industry. While there were a few notable exceptions, Advent and Morningstar are two that come to mind, much of the technology supplied to independents came from small firms. In the early 2000s, firms that are well-known today, such as eMoney, MoneyGuidePro, Redtail and Orion, were still essentially start-ups. Few firms had scale.

Before the Great Recession of 2007-2009, there was little interest from outside the industry in financial technology. There were few firms outside the industry interested in developing technology for advisors, and there was little interest from outsiders in financing FinTech firms.

As a result, technology change within the industry was a slow, evolutionary process. Firms, be they custodians, broker-dealers, third-party software providers or individual RIA firms were not heavily penalized for being late adopters of new technologies because their competitors were, for the most part, following similar strategies. Of course there are exceptions to the rule. Innovative firms like eMoney, MoneyGuidePro, Redtail and Black Diamond are a few examples of firms that embraced new technologies early and prospered as a result.

The point is that things have changed as the advisory business has boomed. The next generation of clients have different expectations than the current generation. Outside forces such as Wealthfront and Betterment have exposed weaknesses in what was at the time the standard RIA technology offering. Private equity money is ready to finance new financial technology ventures. In summary, competition is heating up.

While many firms have been caught off guard by the transformation taking place in FinTech, a number of industry participants have been making moves of their own to stay ahead of the curve. Let’s briefly examine what a few well-known names within our industry have been up to.

Perhaps the most acquisitive firm of the ones I follow closely has been Envestnet. By my count, it has made almost a dozen acquisitions since 2001. At least four should be of particular interest to readers. In 2012, Envestnet purchased Tamarac. Tamarac’s Advisor Xi suite provides RIAs with an integrated platform that includes client relationship management; portfolio rebalancing (with intelligent tax-loss harvesting capabilities) and trade order management; portfolio accounting and billing; performance reporting; and a client portal. Tamarac’s clients are primarily midsize to larger independent RIA firms.

From our perspective, the Tamarac acquisition made sense strategically. Envestnet had always been a strong competitor in the enterprise side of the business, but was less so in the independent RIA space. With the RIA side of the business growing more rapidly at the time than some of the other markets Envestnet participated in, gaining a strong foothold in the independent channel was a strategic imperative. Tamarac made the company an immediate player in the RIA space.

This year, Envestnet has made two significant technology acquisitions, and a third is currently pending. First, it purchased Upside, a small robo-advisor platform provider. Next, it acquired Finance Logix, a financial planning software firm. Although the latter is best known to advisors for its comprehensive financial planning application, it has also developed a retirement income application for advisors, an award-winning mobile retirement app for consumers, as well as a financial health app for consumers. Envestnet has also announced an agreement to purchase Yodlee, an account aggregation and data analytics platform. Envestnet’s NYSE-traded shares took a big hit on the day the deal was announced, indicating that institutional shareholders didn’t like the deal, but the jury is still out.

According to Bill Crager, president of Envestnet, all of the above-mentioned acquisitions fit in with Envestnet’s long-term strategic vision: to be the firm that can offer all of its clients a holistic, end-to-end wealth management platform. To Crager, that means a platform where investors, either working with an advisor or through a self-service platform, can set their goals, create an investment strategy, execute the strategy and then receive reports to let them know how they are doing—particularly to help them understand whether they are on track to meet their goals.