“We measure account openings in seconds,” Capuzzi says. “Betterment needed the ability to make that experience for its clients as fast and seamless as possible. No paperwork needed, no web signatures or DocuSign, no waiting … it’s opened immediately.”
Will Trout, head of wealth management research at Celent, calls Apex the custodian of choice for digital advisors. That said, Wealthfront last year parted ways with Apex.
“If you talked to Andy [Rachleff, Wealthfront co-founder and CEO], he’d say we really helped launch their business,” Capuzzi says. “But they got to a place where they wanted to control more of the client experience and have it more exclusive to them, and it’s something that was the next step in Wealthfront’s evolution.”
Wealthfront wouldn’t comment for this article, though the company did highlight a blog that said it had decided to build its own banking and brokerage platform to better control its destiny.
Beyond that, the retail investor-focused robo, or B2C, space is maturing as smaller firms exit the business and the larger ones—think Wealthfront and Betterment, for example—seem best positioned for the long haul. That means less potential robo clients for Apex.
At the same time, Capuzzi says, traditional enterprise advisor firms are scrambling to offer digital advice as well as fast, automated online account features to appeal to younger investors used to doing business on mobile phones. And they want to find ways to profitably serve younger investors who have fewer assets than the typical RIA client.
“And even ultra-high-net-worth clients want some kind of pleasant, digital type of solution,” Capuzzi says. “Just because someone has a lot of money doesn’t mean they don’t want immediacy and the ability to quickly open an account or transfer assets. We find that advisors want a solution that spans from the robo solution up to the high-net-worth solution. And that’s where Apex has started to make a name for itself.”
Trout says Apex is well positioned to be a significant player in the next phase of online digital advice—what he calls Robo 2.5, with the emphasis on enabling traditional advisors to provide a digital investment experience for their customers.
“This is an exciting time in the B2B space because you’re seeing a lot of legacy institutions with complex architecture struggling with digitizing their capabilities,” Trout says. “So you’re seeing the emergence of dedicated B2B platforms like Trizic, RobustWealth and InvestCloud that aren’t necessarily wealth advisors but are providing the digital tech for financial institutions to offer digital advice.”
Apex forged relationships with all three of the above-mentioned companies last year. “Their technologies are brand new, so there’s no legacy code,” Capuzzi says. “Their space is the front office, while ours is the back office. It’s a good partnership because our respective offerings don’t overlap.”