Building The Perfect Tech

“To be or not to be” may have been Shakespeare’s question centuries ago, but the current question for broker-dealers is “to build or to buy?”

As financial technology becomes more complex and more necessary for advisors, broker-dealers have to decide how to provide the best products to attract more advisors and RIAs to their platforms.

Some, like Commonwealth Financial Network in Waltham, Mass., and San Diego, have built impressive in-house platforms that the firm says set it apart from its competitors. Others, like Kestra Financial in Austin, Texas, have bought the best platforms built by others to offer to their advisors.

Other broker-dealers fall into one of the two categories or they have created hybrids, buying some things and building others internally, like Ladenburg Thalmann has done. “The recruiting landscape is more challenging than it has ever been, and advisors are weighing their options when they want to move,” says Greg Gohr, senior vice president, wealth management, at Commonwealth. “We give advisors two choices of how they want to affiliate with Commonwealth: They can operate under our RIA and we handle all of the compliance, or they can maintain their own RIA.”

To provide the best platform for the advisors and RIAs, Commonwealth has built Client360, a complete fintech platform.“Where most other firms cobble together a fintech program, Commonwealth, over the last 20 years, has built a unified, in-house system for all the technology advisors need and use,” says Kol Birke, managing principal of corporate strategy at Commonwealth. “It started with a client’s holdings, balances and activity; then we added document planning and CRM. Now we have developed Client360 to enable advisors to have a one-click review of everything about a client with the advisor’s logo on it.

“Advisors have the ability to hit a single button and get performance reporting, goals summaries and planning. It lets advisors set goals, and sends alerts if the advisors and clients are not on track. Advisors no longer have to spend hours putting reports together for goals-based planning,” Birke says. “An advisor can add a new goal in a couple of minutes and it is integrated with the client review to make it easy for the advisor to talk with the client.

“The advisor can then repurpose other staff members to higher level activities rather than having them entering data six different times. This is a massive differentiator for Commonwealth.”

The firm has also developed “Investor360,” which allows clients to log into their portfolio from any device.

“The wave of the future,” Birke says, “is to find more ways to engage a client digitally in the way the client wants. In the next month or two, we are adding compliant text messaging.”