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Industry Spotlight > Mergers and Acquisitions

InvestCloud Acquires Advicent and Its NaviPlan Platform

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What You Need to Know

  • The acquisition provides InvestCloud with a competitive financial planning offering, according to Joel Bruckenstein, T3 president.
  • Financial terms of the transaction were not disclosed.
  • The acquisition comes as market volatility has accelerated the industry's focus on financial planning.

InvestCloud has acquired Advicent and its NaviPlan financial planning platform from Vista Equity Partners in a deal that closed this week, according to Mark Trousdale, InvestCloud chief marketing officer.

Advicent provides financial planning technology for more than 140,000 financial professionals across nearly 3,000 firms globally. Via its NaviPlan platform, Advicent creates scalable financial planning software through application programming interfaces (APIs) as well as cash flow and goal-based planning engines.

The acquisition was announced jointly by Advicent and InvestCloud, a provider of cloud-based financial digital solutions, on Wednesday. But financial terms of the transaction were not disclosed.

Asked how the deal came about, Trousdale said: “There has been mutual admiration for some time. Advicent was of interest to InvestCloud due to the combination of offering a highly differentiated planning engine while also covering advanced retirement income scenarios and estate/trust planning that focuses on the very difficult planning aspects of tax and cash flow. This was an area that InvestCloud wanted to invest in.”

The transaction is “significant because this fills a large gap in the InvestCloud offering,” according to Joel Bruckenstein, president of Technology Tools for Today (T3).

“One of the big trends over the last few years has been the increased focus on financial planning or financial wellness,” Bruckenstein told ThinkAdvisor. “Tegra118, which InvestCloud previously bought, had some financial planning capabilities, but in my opinion they were dated. This gives them a more competitive offering.”

Meanwhile, “from the Advicent side, it is no secret that Vista has been trying to sell Advicent for some time,” he explained, adding: “This puts Advicent into the hands of a firm that is potentially a good strategic fit.”

Advicent’s global headquarters are in Milwaukee, and its European base is in the Netherlands.

InvestCloud supports more than $4 trillion of assets for more than 500 direct clients, including some of the world’s largest banks, it says. The company says it offers on-demand client experiences and intuitive operations solutions using an ever-expanding library of modular apps.

“The acquisition aims to create the world’s leading financial planning solution,” Advicent and InvestCloud said in a joint announcement. “It does this by bridging the advisor-client communication gap by combining Advicent’s cash flow, trust and tax financial planning engines with InvestCloud’s digital client and advisor platform and existing market leading goal-based financial planning engines.”

The transaction comes as “market volatility has accelerated a focus on financial planning — a market worth $52.9 billion in the U.S. alone, and predicted to grow 3.5 percent in 2021,” the companies pointed out.

“Advisors require connected experiences for their clients to enable seamless integration from financial plans to proposals, and on to implementation,” they explained. “The acquisition will give advisors a full-scope unified platform to achieve this, alongside providing client management and ongoing maintenance functions. It will offer a comprehensive digital experience across an advisor’s entire book of business, from mass affluent to ultra-high-net-worth individuals.”

InvestCloud’s planning engine “will be enhanced with the combination of Advicent (NaviPlan),” John Wise, CEO and co-founder of InvestCloud, said in a statement. “Advicent is a highly differentiated planning engine covering the simple goal-based assessments that most of the known financial planning engines cover; however, and importantly, Advicent also has advanced retirement income scenarios and estate/trust planning focusing on the very difficult planning aspects of tax and cash flow,” he said in the announcement.

That will be “greatly leveraged” by the InvestCloud planning solutions and platform used by advisors today, he said, adding: “The Advicent team has created a great asset which, when combined with InvestCloud’s expertise in Digital Design, Gaming Theory, Decision Theory and Data Science, will accelerate the Advisor experience and drive better adoption and better outcomes.”

With the support of investment partners Motive Partners and Clearlake Capital, InvestCloud is “able to substantially grow both organically and by enabling great acquisitions such as Advicent,” he also said.

The opportunity that the merged companies see together is “massive and our team has thought this for years — how powerful a partnership would be with InvestCloud,” Angela Pecoraro, Advicent CEO, said in a statement. “As digital plays a more and more critical role in the advisor experience, InvestCloud’s platform will enable our clients to reduce complexities, increase flexibility, and be a game-changing power for client-to-advisor collaboration by applying behavioral science to improve client outcomes.”

InvestCloud’s latest acquisition further expands its global client base in North America and Europe, while also “deepening its dominance within wealth management, trust and estate planning, as well as private banking,” according to the companies.

The capabilities will be immediately made available to InvestCloud’s existing global client base through its Digital App Store, they said.


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