Private Banker International’s (PBI) monthly round-up of developments in private banking and wealth management technology
Wealthfront raises $75m in funding
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US-based robo-advisory platform Wealthfront has raised $75m in a funding round led by New York-based investment firm Tiger Global Management.
Existing backers such as Benchmark Capital, DAG Ventures, Greylock Partners, Index Ventures, Ribbit Capital, Social Capital and Spark Capital Growth also participated in the latest round.
Wealthfront will utilise the fresh capital to improve its Path tool, an automated financial planning service that enables clients to view financial accounts in one place.
Wealthfront co-founder and CEO, Andy Rachleff, commented: “Path’s appeal to young people propelled our growth such that people under-45 now represent 85% of our clients.
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By GlobalData“We believe our success with this group is based on our unique ability to optimise and automate our clients’ personal finances.
Rachleff added: “This year we will be launching many new software-based capabilities that will provide value to our clients throughout their lifetime.”
Launched in 2011 by Rachleff and Dan Carroll, Wealthfront offers financial planning, investment management and banking-related services. The platform currently oversees $9bn in assets.
Linedata teams up with UnaVista for MiFID II
Linedata, a provider of technology solutions to the investment management and credit finance industries, has partnered with London Stock Exchange’s UnaVista to offer MiFID II-compliant platforms to its clients.
MiFID II, which became effective from 3 January 2018, seeks to bring increased transparency and efficiency to financial markets and strengthen investor protection.
According to the terms of the partnership, the businesses’ mutual clients will use UnaVista as an approved reporting mechanism to report transactions to National Competent Authorities (NCAs) for all required asset classes.
MiFID II requires investment businesses to submit detailed transaction reports to their NCAs within one day of a transaction.
Clients can send data from multiple sources though Linedata’s reporting interface, after which UnaVista determines which transactions are reportable, and to which NCAs they must be sent.
Beam Capital Management unveils blockchain-focused account
Beam Capital Management, a New York-based investment adviser, has unveiled a separately managed account strategy which invests in publicly traded securities of firms leveraging blockchain technology.
The new vehicle, Blockchain Leaders SMA, will, however, refrain from directly investing in Bitcoin, Bitcoin futures, digital currency and other coin offerings.
Mohannad Aama, CIO of Beam Capital, will oversee the new strategy as portfolio manager.
The strategy will be initially available to the business’s new and existing individual and institutional clients, and other advisers using TD Ameritrade Institutional as custodian.
AdvisorEngine snaps up CRM provider Junxure
Wealth management technology platform AdvisorEngine has taken over Junxure, a client relationship management (CRM) software provider, for an undisclosed sum.
Junxure’s 12,000 clients currently manage more than $600bn in assets.
AdvisorEngine said the takeover enhances its open-architecture ecosystem and enables it to connect disparate technologies and data to create a unified user experience. The merged entity will allow financial advisers to automate investment and business processes, irrespective of CRM provider.
AdvisorEngine founder and CEO, Rich Cancro, said: “The next frontier of innovation within financial services is happening at the intersection of personal relationships, data science and automation – which makes native CRM functionality especially powerful.”
WisdomTree Investments, the largest shareholder of AdvisorEngine, will provide up to $30m in capital to AdvisorEngine. Most of the capital will be used to fund the deal, while the rest will be used for future technology development initiatives.
Envestnet wraps up FolioDynamix acquisition
Envestnet, a US-based wealth management technology provider, has completed the purchase of competitor FolioDynamix from Actua in a deal worth $195m.
FolioDynamix offers an end-to-end technology solution and a range of advisory tools such as model portfolios, research and overlay management services.
The deal adds complementary trading tools with a commission and brokerage business support to Envestnet’s product range.
FolioDynamix chair and CEO, Joseph Mrak, said: “By joining forces with Envestnet, our customers will have access to the trading tools and commission and brokerage support that they are accustomed to, as well as Envestnet’s robust and integrated wealth management solutions.”
The transaction, which was first announced in September 2017, was funded with borrowings under Envestnet’s revolving credit facility.
Deutsche Bank rolls out AI-based equities trading platform
Deutsche Bank has rolled out an upgraded equities trading platform in the Asia-Pacific region, which uses next-generation algorithms and AI technology to help investors achieve best execution for trades.
The new Autobahn 2.0 platform uses self-learning mechanisms to forecast equity pricings and volumes, thereby improving execution quality.
The platform also incorporates momentum detection, which allows it to change behaviour in trending markets or make a fast switch at inflection points.
The rollout is expected to be completed in most Asia-Pacific markets by the first quarter of this year.
