Could robo-advice become as universal as ATMs?
Erik Jepson, chief customer officer at Advisor Software, thinks so. And he thinks this will happen relatively soon.
“We believe digital advice or robo-advisors will be as ubiquitous as ATMs in two or three years,” Jepson said during a visit to ThinkAdvisor’s New York office. “Almost everyone will offer one. I think you’ll be surprised, even family offices, ultra-high-net-worth-focused institutions are going to have variations – more sophisticated variations – but variations nonetheless on robo-advice platforms.”
In fact, Advisor Software is well on its way to helping this become a reality.
Jepson says “shortly we’ll be coming out with a white-label robo-advisor” through Salesforce’s recently launched Financial Services Cloud with the goal to give a lot more advisors the opportunity to offer robo-advice.
Salesforce officially launched its Financial Services Cloud, first announced in August, on Tuesday. Advisor Software was one of Salesforce’s three original strategic partners, along with Yodlee and Informatica, to help provide interconnected applications inside the financial services cloud. Salesforce has since added a dozen more partnerships, including DocuSign to provide electronic signature technology and The Athene Group to help with account opening and data aggregation.
“The Financial Services Cloud is a reimagining of Salesforce CRM specifically for the financial services industry,” Jepson explained. “So they completely restructured their database so that it is aware of the types of things that are important to the financial services ecosystem. The notion of an account being a financial account, rather than a relationship I have with a contact like the traditional CRM says.”
The white-label robo-advisor that Advisor Software has developed for the Salesforce Financial Services Cloud will offer something to both clients and advisors. Other white-label robo-advisors in the market today include Betterment Institutional; Jemstep, which was recently acquired by Invesco; and FutureAdvisor, which was recently acquired by BlackRock.
According to Jepson, the original crop of robos were designed solely for consumers, so “they are somewhat limited in their utility to advisors.” Advisor Software’s robo was designed more as a hybrid advisor-consumer solution right out of the gate, he said.
This client-facing aspect of Advisor Software’s robo-advisor will allow for an automated account opening process. Clients will be able to fill out a risk questionnaire, select one or more goals, be mapped to an optimal investment portfolio and then connect to DocuSign for account opening. Clients will also be able to monitor their investments, add additional goals, as well as integrate with Yodlee to link all of their asset accounts.
Meanwhile, the advisor-facing aspect of the robo-advisor will allow the advisor to monitor their digital advice customers through the Salesforce CRM platform. The robo-advisor will also integrate with Advisor Software’s other new application within Salesforce, “Portfolio Rebalancer,” which is a portfolio management application for advisors.
Anyone that uses the Salesforce Financial Services Cloud will be able to offer this robo-advisor, Jepson said. It also gives advisors a lot of flexibility in terms of what they want to offer, he added.