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Fintech Report Card: January 2020

Below is the January edition of the Fintech Report Card, a monthly piece by Riskalyze CEO Aaron Klein originally published in 

Visa Acquires Plaid

What happened: Visa acquired a data aggregation platform, Plaid, for a staggering $5.3 billion price tag. The current plan is for Plaid to continue operating as an independent business unit.

Why it matters: A couple of thoughts come to mind with this blockbuster deal. First, data is big business for financial services, and Visa intends to be the disruptor, not the disrupted. Second, Plaid’s founders should be pretty grateful to the late great Jud Bergman for making them the last standing aggregator and driving up their acquisition price. (Who thinks Yodlee looks like a steal now!?)

Third, the big question mark is how this deal will impact advisors. Aggregation was already considered expensive by most advisors; how will ownership by Visa impact the pricing and accessibility of aggregation? Time will tell.

Finally, perhaps the best part of Visa acquiring Plaid is that Visa’s influence makes it almost impossible for the big banks to shut down data aggregation, which is the backbone of money movement and competition in financial services.

SMA Portfolio Construction Comes to Cryptocurrency

What happened: A cryptocurrency trading platform, SFOX, introduced separately managed accounts to allow advisors to create crypto-focused trading strategies.

Why it matters: Cryptocurrency is still relatively young and unproven, but one of the biggest headwinds is accessibility to advisors. Many firms won’t venture away from their custody arrangements to access alternatives for their clients; to the extent that advisors find this non-correlated asset class to be growing in appeal, making it easily available to the average RIA will drive adoption.

Altruist Partners with Citibank for Custody

What happened: Altruist, a startup digital custodian and technology platform, announced it will partner with Citibank to custody assets.

Why it matters: A lot of eyes are on Altruist, if only to see if they will cause real disruption for the major custodians and platforms, or settle into a secondary tier of technology and custodian options. Partnering with a trusted name will go a long way in helping them establish a secure foundation as they compete against institutional brands with years of built up trust. All eyes are on Jason Wenk and his team to see how they execute.

Asset-Map and Black Diamond Announce New Integration

What happened: Black Diamond has added Asset-Map as a new integration to the Relationship Timeline feature in its client portal.

Why it matters: It’s always good to see friends work together! Both these companies have been integration partners of Riskalyze for some time, and both provide terrific tech solutions that help thousands of advisors every day. Technology integrations and advisor efficiency are highly correlated, so big applause from us.

Envestnet Buys Stake in Dynasty Financial Partners

What happened: Envestnet is taking a minority position in Dynasty Financial Partners. Envestnet CEO Bill Crager is personally joining Dynasty’s board. The two companies also announced a joint project called Advisor Services Exchange.

Why it matters: This looks like a big win for Envestnet advisors as they get access to the huge knowledge base and advisor value proposition that Dynasty offers. The question that will hang over Shirl’s deal, of course, is a big one: will Envestnet eventually look to more fully integrate Dynasty into their business? Either way, this is a great collaboration, and how it evolves will be interesting to watch.

Former Fidelity Exec Joins Goldman Sachs

What happened: Anthony Rochte, who headed up Fidelity Institutional’s digital wealth management platform, is heading to Goldman Sachs to lead Private Bank Select, which offers access to securities-backed loans for independent advisors and broker-dealers.

Why it matters: As fee-only RIA firms get more mindshare (and market share), access to banking services are a huge potential area of growth. Given Goldman’s $750 million investment into the RIA business with the acquisition of United Capital, this initiative deepens that bet on the independent advice business.

Canadian Robo-Advisor Calls It Quits

What happened: Emperor Investments, a Canadian robo-advisor headquartered close to Toronto, closed its doors with just over $600,000 in assets under management.

Why it matters: Another day, another robo pulls the plug. It’s never fun to see a business close and people lose work, but for our industry it’s a reminder of the power that human advisors have, how inherently personal great advice truly is, and how advisors need to take their value seriously.

T3 Events Add a Code of Conduct

What happened: The Technology Tools for Today conferences, led by T3 Advisor coming up in February, has added a code of conduct for its attendees to follow.

Why it matters: I love that our industry is taking this issue seriously. As a firm that runs a relatively large advisor conference, we’ve always had a zero-tolerance policy for harassment. I’m grateful for conferences like T3 and XYPN that carry the banner for treating everyone with respect and kindness.

Mobile Payments App Raises $45 Million in Funding

What happened: Lydia, a peer-to-peer payments app based in France, raised $45 million in a Series B round.

Why it matters: Why does a French payments app matter to US financial advisors? Like many of its US counterparts, Lydia is already building the features to edge into wealth management. The critical issue is that advisors pay attention to the user experience — consumers are getting more attuned to great tech experiences every day, and no advisor can afford to have their tech experience left behind.

WisdomTree Brings Blockchain to ETFs

What happened: WisdomTree led a Series A funding round to invest nearly $18 million in Securrency, a technology startup that is building blockchain-based technology to improve securities transactions.

Why it matters: Blockchain in theory will create a safer, more secure, more stable and decentralized foundation for financial transactions. WisdomTree’s investment is a bold play to own the future of how funds are traded and custodied, and it’ll be fascinating to see how this bet plays out.

 Aaron Klein is CEO at Riskalyze.

Editors note: The views expressed in this column are Aaron Klein’s, and do not necessarily reflect the opinions of

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