When it comes to portfolio management and performance reporting, many independent advisors can only wish for new choices. Now, they are getting their wish. Over the last year, several new entrants have been working to roll out products for independents, and these products are finally coming to market. One of the new players is Investment Advisory Network.
The Englewood, Colorado-based company was founded in 1993 as a wrap account provider. In 1997, IAN shifted focus toward reselling the technology platform it had built for distributing its wrap product. In 2001, IAN migrated its technology to the Web, and its metamorphosis into a full-blown technology provider is now complete.
IAN’s business nowadays is providing portfolio management, accounting, and performance reporting software and services for a mutual fund wrap program offered by Bank of New York, and a fund wrap and separate account manager program offered by Dreyfus Investment Services and Frank Russell Company. Now, IAN wants to leverage its technology platform by opening it up to RIAs.
To evaluate IAN, seven seasoned advisors from established RIAs participated in a 75-minute demo by IAN’s operations chief, Michael Winnick, and sales director, Doug Moses. The consensus opinion: IAN could be a serious new contender in the PMS category.
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Greg Friedman, an advisor in San Francisco who designed Junxure-i, a customer relations management software program for advisors, says IAN’s tax lot reporting is as good as any he’s seen in a PMS application. Lou Stanasolovich, president of Pittsburgh’s Legend Financial Advisors, says IAN’s application is a “giant first step.”
“This is an independent organization and could be another player for RIAs,” says Stanasolovich. “They have a business history and major institutions as clients, and some cash behind them, so they’re credible.”
While all of the advisors who saw the demo say IAN’s technology has the potential to serve RIAs, they also say it needs some work. The graphics in reports are not very snazzy, and it’s not clear how IAN will work with an advisor who wants to actively make changes daily in his database. Still, IAN’s Web-based PMS application is only months away from being truly competitive with Advent Axys or Schwab Centerpiece.
Tom Connelly, of Keats Connelly & Associates in Phoenix, noted that switching to IAN would require additional training and entail the other hassles of a software conversion. And while Connelly noted that his tour was limited, “as an Advent user, I did not see additional capabilities that would entice me away right now, and the price is not incentive enough.”
IAN has succeeded in customizing reports used by its big institutional clients. Customizing reports for hundreds of RIAs is more difficult, but can be done by IAN if it decides it would be good business. Winnick says the company is determined to serve RIAs, and he proved it.
During the conference call and Web demo, Winnick quoted prices to the seven advisors who participated. They did not like the prices. Stanasolovich, for instance, told Winnick that the pricing he described would be double what he now pays.
Winnick welcomed the feedback. In fact, he later told me he wanted to invite the seven advisors to join an advisory panel that could help IAN get things right. Moreover, in a subsequent conversation, Winnick, after talking it over with other IAN executives, restructured RIA pricing.