These are exciting times at Vestmark: We have been rolling out new features and tools in our core products, adding a new tax-managed portfolio management service, and are on the cusp of launching a new advisor experience solution that will put more capabilities into the hands of advisors themselves.
For those familiar with Vestmark, which has for decades provided portfolio management for the very largest wealth management companies, this pivot to the advisor experience – how the men and women who work directly with clients do their jobs – might seem like we are entering a whole new business.
In fact, our focus remains exactly where it’s always been: Helping large wealth firms efficiently and profitably manage investment portfolios. But as we have observed the evolution of the wealth management landscape, we realized there is a new class of large wealth firms – as well as firms that aim to become very large very fast – and realized they face challenges that require an updated approach, which we believe starts with the advisor.
Trends in Wealth Management and Their Implications
Since I joined Vestmark in 2022, we have been reimagining what the optimal wealth management workflow looks like. As always, the answer is different for each firm, but we saw these five major trends converging – and in the process, revealing new opportunities.
- The consolidation and rollup of RIAs: The past decade plus has seen the rise of RIA consolidators and rollup firms that bring many smaller firms together with the promise of shared efficiency. Many family-owned firms are going up for sale as the next generation opts not to take over. As a result, we are seeing a new class of super-sized firms with $10 billion, $20 billion, even $100 billion or more in assets under management. The tools they were using effectively as smaller firms sometimes crumble under that load.
- A decreasing wealth advisor work pool: Even as some firms get bigger, the total number of advisors is shrinking as retirements add up and fewer new advisors come into the workforce.
- Increasing complexity of investment strategies: That means fewer advisors are managing more clients, and those portfolios are becoming more complex – blending equities, fixed income, even alternatives and more.
- The opportunity of AI: Meanwhile, artificial intelligence has surged in capability, and now can both effectively manage many mundane administrative tasks and also help extend the capabilities of advisors – quickly translating complex requests into client-ready reports and insights.
- The rise of the next generation of advisors: Finally, the new advisors coming into the business are of an age where digital assistance is second nature. They don’t want jobs with forms to fill out and reports to collate.
In all of these cases, improving the advisor experience was a key to the firm’s success. Helping a smaller team manage more clients and more complex portfolios more efficiently, attracting next-generation advisors – all of these are key to a firm’s success. And being able to manage ever-increasing assets was essential for firms that are super-sized or aim to be.
Why Vestmark is Rising to This Challenge
At Vestmark, we did the hard part first. We saw that this opportunity matched our capabilities. Our VestmarkONE® platform, designed from the start to efficiently process tremendous workflows and to handle almost every type of complex transaction, is still the heart of our solutions.
What we are adding is more of the advisor-facing tools – things like billing, reporting, proposal generation, and more – and creating a new, single interface that brings them together along with user-appropriate access into the Vestmark engine, letting them use capabilities needed by the firm or advisor through a simple UI. Adding agentic AI that can execute certain tasks for advisors without needing to dig through menus makes it even easier.
For these large and growing firms, we offer futureproofing, no matter how large they grow. We let rollups bring advisors together on one simple interface. Firms can adapt their installation to suit their structure, whether giving more autonomy to advisors or letting the back office take on more of the execution. And they benefit from tapping into a proven, battle-tested platform that can support a firm’s growth.
What the Future Holds for Wealth Firms – And Vestmark
With this evolution, we plan to establish Vestmark as more than a developer of fintech products, but as a consultative partner. We are expanding our skillsets and team to perform that role.
We look forward to assisting a new class of clients and helping them become everything they can be. But we aren’t abandoning our roots – all of the improvements we are making are desired by and beneficial to the industry leaders who already use VestmarkONE. Our innovation and focus on advisor experience will help their teams as well.
We firmly believe in making the advisor experience the best it can be, while giving firms the flexibility to adapt to their own business plan and approach. Because when advisors succeed, then clients have a positive experience, bringing in more assets and helping win more new clients – a virtuous cycle benefitting everyone from end clients to firm owners.
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