The 2013 Technology Tools for Today (T3) conference ran last week from February 11th to 13th in Miami, Florida. Entering its 8th year, the event is hosted by financial advisor technology consultants Joel Bruckenstein and David Drucker, and continues to grow, as this year’s conference included more than 600 total attendees and over 75 companies (generally hand picked by Bruckenstein and Drucker) that provide technology-related solutions for advisors – which means it will by far be the largest advisor-centric technology conference of the year. And notwithstanding how the event has grown, the reality is that the conference still has ample room to expand further, given that several problem areas for advisors still had relatively few solutions present. In fact, it was somewhat ironic that the conference had a thriving Twitter hashtag but only one provider of social media archiving tools!
In looking amongst the vendors and solutions available at the conference, several clear themes emerged, including an ongoing shift to web-based “cloud” solutions, the rising trend of software integration around CRM as the hub, and the availability of software on mobile devices. But perhaps one of the most striking themes heard from advisors in the hallways at this year’s conference is simply that the available technology solutions have become so numerous, now one of the greatest challenges is just choosing amongst them all!
To say the least, the T3 conference is now a permanent “fixture” of the financial advisor conference space, and the growth of the event suggests the future still looks bright both for the conference itself, and the growth of technology solutions for advisors!
The Ongoing Shift To The Cloud
Although not all financial advisors run their businesses using web-based “cloud” software, the strongest growth in the world of advisor software has clearly been towards cloud solutions, from MoneyGuidePro and eMoney Advisor for financial planning software (with NaviPlan slowly migrating to the cloud over the past two years), to Redtail and Salesforce for CRM (with Junxure migrating to the cloud this year). Numerous vendors at the T3 conference were available to provide web-based platforms for portfolio management and reporting software.
Notwithstanding the shift to the cloud from vendors, though, the theme of several general sessions at the conference made it clear that most companies still find themselves needing to explain and justify why a cloud-based solution is superior to the advisor’s traditional in-office on-servers-and-local-computers approach to technology. The discussion ranged from how most quality cloud solutions really are far more secure for data than an advisor’s own office, to the cost efficiencies for advisors to get out of the business of buying and maintaining their own server hardware, to the productivity of being able to access and interact with key information from anywhere (such as pulling up client portfolio or financial plan information directly from a tablet in a client meeting, or being able to record important notes and assign client tasks to staff members the moment you walk out of the meeting). In addition, several speakers noted the disaster recovery benefits of cloud technology solutions – several advisors that had been displaced by the New England blizzard that had preceded the conference, not to mention Hurricane Sandy a few months prior, noted the benefit that even when their local office had no power they could access all of their client information and data directly from their cloud providers.
The trend towards the cloud still appears to be in the early stages for the financial advisor industry overall, but the direction is clear, especially as everything from connectivity to security continues to improve.
The Rise Of Integration And Integrators
Another strong theme apparent at the T3 conference is the rising level of integration amongst software packages, with CRM (client relationship management) software increasingly operating at the hub. Supported by industry initiatives like Your Silver Bullet, open architecture pushes from custodians like TD Ameritrade’s Veo, and core software packages with a heavy API offering like Salesforce CRM, the software written for financial advisors is increasingly capable of “talking to” the other key software packages. Although there is not yet a universal language that allows all software to easily connect from one program to another – the integrations are still built one connection at a time – the world of software for financial advisors is clearly being turned upside-down as the ideal solution shifts from a “holy grail” (a single combined piece of software that does everything) to instead an integrated series of software packages that are each best-in-class in their respective role and able to port key information to the other core software components. In fact, it’s notable that at T3, many of the exhibitors are there not to meet advisors at all, but to network with other exhibitors and develop relationships that can lead to further software integrations!
In addition, the emergence of “integrators” – companies that focus on building middleware software or doing custom programming that helps to handle the heavy lifting of getting one software package to talk to another – is accelerating the trend towards software integration, and promoting the software companies that are the most flexible for integration. For instance, AppCrown facilitates integrations across many key advisor software packages back to Salesforce, and Concenter Services (which makes the XLR8 template) and The Athene Group help to adapt and customize Salesforce CRM to an advisory firm’s needs (it’s no surprise that Salesforce continues to be popular as an advisor CRM platform with so many middleware integrators promoting it!); in addition, Salentica (albeit not present at T3) provides a similar role for Microsoft Dynamics CRM. Similarly, the newly launched CloudRIA (which announced at T3) seeks to help advisory firms create and integrate workflows that might run across multiple software packages used in the business. In other cases, the integration focuses on the portfolio accounting software and works back to the other platforms, an advisor integration strategy that has been particularly effective for firms like Orion Advisor Services.
Of course, the caveat to all of this is that in many cases, the ultimate blocking point is not actually the integration of the software itself, but the fact that it is often underutilized in the business, due to a combination of insufficient training for staff, and a lack of standardization to the processes and workflows of the firm. As a result, another noticeable trend at the T3 conference was the number of exhibitors that provide consulting services and support to help advisory firms actually maximize and get the most out of their technology, including Trumpet Inc., XTrac Solutions, Orchestrate LLC, the Fox Financial Planning Network, and popular conference WiFi sponsor ActiFi.
Emerging Technology Challenges
Seeing the cutting edge of technology at the T3 conference also served to highlight some of the challenges emerging about the pace and direction of technology development as well, underscored by the irony that several sessions themselves were plagued by Powerpoint and A/V problems (albeit to a very sympathetic technology-inclined audience!).
One of the most notable emerging technology challenges was how some vendors are clearly struggling with decisions about their direction for supporting mobile devices. While the adoption rate of tablets has been rapid with advisors – the recent Financial Planning magazine Tech Survey showed upwards of half of all advisors already own one, despite the fact that iPads haven’t even been out for 3 years yet! – software companies are clearly struggling with deciding what platform to develop for, even as advisors struggling to figure out how best to efficiently use tablets will be a major theme for 2013 in the first place. While the aforementioned Tech Survey indicated that more than 80% of advisors own iPads, a non-trivial number are using Android or Windows devices (RIA custodian TradePMR in particular demonstrated an impressive Windows 8 app), and the latter categories are growing, and for most firms it’s a challenge to develop for all 3 environments simultaneously. Some have chosen to focus on one direction in particular, while others have decided to focus not on making “apps” but simply on having a quality web-based interface that can be utilized from a browser on any device and platform.
Similarly, another notable trend was the increasingly number of platforms that are trying to create “apps” (e.g., the RetireLogix financial planning app or the Orion Advisor Services app) or privately branded “portals” or “vaults” for the clients of advisors that is built onto the back end of many software packages (e.g., from eMoney Advisor). Yet at the same time, the proliferation of apps, portals, and vaults itself may become problematic for some firms; to the extent that each software package has its own offering, suddenly clients may end out with a confusing array of overlapping apps and portals to use, eliminating much of the simplification benefit they were intended to bring. It remains to be seen if new providers will emerge that can integrate multiple software packages and platforms for a client portal in a similar manner to what’s being built for advisors.
Overall, though, perhaps the greatest technology challenge apparent at the conference remains the simple fact that advisors are only moving in a wary, begrudging manner to the cloud. Questions about security of the data, portability of the data if the advisor decides to leave, and stability of the company were common. Expect to see a greater focus on establishing a proper due diligence process for evaluating a cloud-based software provider in the coming years.
Room For Further Growth
Notwithstanding the success of the T3 conference itself, it’s notable that the event clearly still has more room to grow.
For instance, there are now only a few financial planning software providers remaining at all – MoneyGuidePro, NaviPlan, eMoney Advisor, FinanceLogix, and MoneyTree continue to dominate the marketplace, with IAS and Sungard lagging behind, although newcomer inStream Wealth is threatening to shake up the environment by demonstrating new ways that software can help change the delivery of financial planning to make it more proactive. The number of popular CRM platforms is even fewer, and the core portfolio accounting software offerings are even fewer still. The software space for advisors is clearly still ripe for new disruptors, and the trend towards independence and cloud-based platforms appears to be making software innovation more appealing as it increases both the flexibility of software, the opportunities for integration, and the potential number of advisor clients for new startup companies.
In addition, for a technology conference itself, there was a remarkable dearth of offerings for online/digital solutions for advisors themselves. For instance, RegEd was the only social media compliance tool that chose to participate in the conference – despite the thriving #T32013 conference hashtag on Twitter – and only AdvisorWebsites and Advisor Studios were offering state-of-the-art website design and supporting video and graphic design services for advisors. And overall, the conference offering appeared to be disproportionately tilted towards the service needs of RIAs in particular, and the unique portfolio management (trading and rebalancing), accounting, and reporting needs that they need, although notably the tools for portfolio design are becoming more sophisticated as well, from old stalwarts like Morningstar to newer entrants like Hidden Levers (although competitor MacroRisk Analytics was nowhere to be seen) and conference newcomers StatPro and Riskalyze (the latter didn’t even have a booth, but its CEO participated in the conference).
Nonetheless, the bottom line is that the Technology Tools for Today conference is clearly now a permanent fixture of the financial advisory world. As I’ve noted in the past, it is already one of the top 7 conferences for financial advisors, and the technology industry clearly thinks so as well, as last year MoneyGuidePro timed its latest G3 software release to the conference, and this year Envestnet used it as an opportunity to announce its new support for mobile devices. With its blend of technology solutions that can augment the efficiency of advisors and their practices, to the networking opportunities for companies that serve them, the T3 2014 conference will clearly be a can’t miss event.