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General Published on: Fri Feb 10 2023

Consolidation wave hits Wealth Management Technology

This year, the wealth Management Technology space has seen a huge spurt in acquisitions, a testament to the consolidation seeping within the industry. To name a few, Envestnet acquires Yodlee, FinanceLogix, Upside; Blackrock Acquires FutureAdvisor, SS&C acquires Advent, Morningstar acquires TRX, TA Associates’ purchases majority stake in NorthStar Financial Services Group.

As CY 2015 draws to an end, here’s a round-up of the significant acquisitions of the year-the ones which have the potential to reshape the industry landscape.

Goliath acquisition of the year

Standing at the top of the acquisition spree we have witnessed in CY 2015 is SS&C Technologies’ acquisition of Advent Software. What is noteworthy about this $2.7 billion acquisition is the giants involved and the impact of the marriage between them on the wealth management industry.

SS&C is a no stranger to acquisition with over 40 acquisitions, but the cherry on the cake is definitely Advent! Advent Software will open the fast-growing registered investment advisor market in the United States to SS&C and expand its international footprint. Apart from geographic diversity, the acquisition brings scale, recurring revenue stream, and a huge opportunity for cross-selling to SS&C. SS&C can now boast of an enlarged capability set in portfolio management and accounting solutions through Financial Models Company, DST, and now, APX and Axys. However, what needs to be seen is how well this acquisition performs on integration, client and employee retention, as well as challenges in cross product solutions. Nevertheless, the acquisition has giant leaped SS&C to SunGard and Thomson Reuters’ ranks when it comes to its extensiveness of capacities and outreach. Hence, the Goliath acquisition of the year!

Robo-Advisor deal stealer

In a deal that may very well qualify as the big shakeout of Fintech in 2015, Blackrock, the world’s largest fund manager, acquired FutureAdvisor, one of the startup- pioneers of “Robo-adviser” space. Wealthfront and Betterment are two major young competitors of FutureAdvisor, while giants like Charles Schwab have also entered the arena earlier this year. Under the deal, which values FutureAdvisor at between $150m and $200m, the company will become part of BlackRock Solutions. Blackrock has probably not purchased the Robo advisor for its current AUM; rather, it plans to leverage FutureAdvisor as a technology platform in B2B space, which includes banks, brokerage firms, insurers, and so on. But this quest will not be an easy one for Blackrock as experts believe that transitioning a B2C company (like Future advisor) with retail focus, architecture, and technology into a B2B services provider will be tricky.

Nevertheless, more than anything else, the deal is a sure sign that automated investment advice is in for a long haul. Hence, the definitive deal of 2015 in Robo advisor space!

The Big Daddy of Acquisitions

Financial Services Software Company, Envestnet, Inc.’s latest acquisition of financial data mining and technology company Yodlee marks yet another milestone in the former’s expedition to build a comprehensive platform of advisor technology -CRM, portfolio accounting and reporting, and financial planning software bundled into one.   The quest started in 2012 with buying off the Tamarac portfolio accounting/reporting/rebalance tool. Then came the big purchase of financial planning software, FinanceLogix, in May 2015, which in turn followed the acquisition of Robo advisor, Upside, and now, finally, Yodlee.  Another crucial underline here is the pace with which Envestnet has transformed itself into an integrated technology platform from an investment outsourcing solution in a matter of just three years! In recognition of the same, Envestnet is the Big Daddy of Acquisitions for 2015!

Hoping for an even more eventful 2016.


About Hexaview: Hexaview Technologies Inc. is a Delaware based company that provides technology solutions to the Wealth Management Industry; its primary development center is located in Delhi, India. It works with the primary objective of addressing gaps in the technology, integration & reporting in the wealth management product space. Our services have helped our clients gain a competitive advantage through technological advancement and superior product development.

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