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Portfolio > Portfolio Construction

Part 3: Independent Competitor

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A new portfolio-reporting package is on the market challenging Advent and Centerpiece in the RIA market. I’m happy to report the emergence of, but doing so also scares me. The last time I wrote a story with a lead like that was in February 1999, when I did the first review in the trade press of a product called Portfolio 2000 from a small company in Denver called Techfi.

My coverage of Techfi in its infancy helped influence some advisors to buy Techfi software, but some of them are now unhappy that they did. Techfi, this past summer, was purchased by its larger rival, Advent Software, putting Techfi customers into the hands of a publicly held company with a reputation for charging high prices, and that many advisors fear will use its central position in their back office data flow to somehow undermine their independence. In addition, the purchase of Techfi followed a decision by Charles Schwab early this year to stop selling licenses of Centerpiece, a portfolio management software product owned by Schwab, to advisors who do not do business with Schwab Institutional.

So, as I am about to tell you of a new portfolio reporting software company in its infancy, I stand before you humbled, but hopefully, wiser.

In covering Techfi’s emergence, I learned about how difficult it is for a tiny company to launch a new portfolio management software product aimed at the independent advisor market, especially one that challenges established firms with highly functional applications, like Advent Axys and Centerpiece. In addition, Advent says it has turned over a new leaf and is committed to serving the small advisor market (those with less than $100 million under management) and is making an effort to repair the damage it did to its reputation by working more effectively with smaller advisors. is a Web-based service bureau started by an institutional money manager and a back-office operations executive who worked with him at a money management firm. Like Techfi in early 1999, eWebPortfolio is not quite ready for prime time, but it does hold potential.

Doug Hohertz, eWebPortfolio CEO, says the product is priced at $2,500 a year for one interface and reporting on up to 100 accounts. Each additional account will cost about $20 a year, but exact pricing will depend on the number of accounts, how many interfaces are used, and the amount of assets under management.

While the database driving the product seems to work smoothly, the Web tour I was given, along with a panel of several advisors, could not verify whether calculations are done properly. But assuming all of the math behind the product is correct, which is a fairly safe bet, the main obstacles immediately facing the company are the lack of interfaces with any of the three major custodians used by independent RIAs, and the lack of any graphics in reports formatted for client presentations.

Hohertz concedes these are not trivial issues. An interface to TD Waterhouse is expected this month and graphics capabilities are in the works, he says. “But the basic functionality is all there.”

Comparing this product’s launch with Techfi’s is irresistible, but so much has changed since then. In early 1999, advisors were optimistic about small technology companies and saw Techfi as a breakthrough product because it was built on a Microsoft database. In contrast, eWebPortfolio was greeted with skepticism by the three advisors who toured the product. The fact that it was Web-based impressed no one.

With Techfi back in 1999, despite the fact that some of the testers had major problems making it run, they saw promise in its technology. With eWebPortfolio, advisors had grave doubts about the vendor’s viability and could not understand why Hohertz marketed the product before building interfaces to the major custodians.

Still, I am hopeful that this new independent competitor will gain some traction. While the system is still some months away from legitimacy, it has the basic features in place, and this company should be watched in the months to come.


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