If approved, advisors will be able to access debt financing of up to 50% of their trailing 12-month revenue. Swenson describes it as “equity-like” financing, because advisors will be able to retain their ownership rights.
Moving forward, ASx will handle all business-to-business financing across the Envestnet platform.
The post-Covid world that Swenson envisions will also involve continued – perhaps accelerated – outsourcing of services, which is where ASx’s outsourced CFO and compliance offerings come in.
“Partnerships are going to be more important, as will be the ability to share data and engage in virtual services and communicaction,” he said. “We’ve just seen more technology evolution in the past three months than we expected to see through the next three years. We’re all looking at the world differently, and technology has become more essential.”
ASx also uses Envestnet’s platform to offer advisors key performance insights. An advisor scorecard made available via ASx will allow advisors to benchmark their firms against their peers, said Swenson. For example, a $500 million AUM advisor spending 15% of their budget on marketing every year will be able to see how they compare to other similarly sized advisors.
ASx will also offer advisors “transition guidance” to help them acclimate to its tools.
Unlike Dynasty, which works with firms with an average AUM of $750 million, Swenson said that ASx is intended for firms with approximately $250 million AUM and up, with a target average of around $400 million.
That means a large portion of the 100,000 advisors using Envestnet’s technology will be able to take advantage of ASx, which will be available to them via an ASx card visible on the Envestnet Analytics dashboard.
Services will be made available on a tiered basis, with “silver” being the most basic tier, “gold” representing a higher level of service, and “custom” being the highest tier.
ASx was first announced in January as Envestnet took a minority stake in Dynasty, but few details were revealed until Swenson hosted a session about the program as part of Envestnet’s 2020 Advisor Summit On-Demand at the end of June.
ASx will work with 20 RIAs as part of the first wave of its program, offering them access to Envestnet Analytics free of charge. Swenson said that advisors interested in being part of this first wave have a two-month window to take advantage of it, and then ASx will open to serve more RIAs once that inaugural class is on board.