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February 15, 2019 at 02:30 PM
Broker-dealer and RIA Commonwealth Financial Network has a new client — but it’s not a financial advisor or team.
The firm’s tech entity, Advisor360°, just inked a licensing deal with Massachusetts Mutual Life Insurance Co., giving the insurance firm’s advisors and field partners access to Commonwealth’s platform of portfolio, workflow, customer relationship management and other tools.
Commonwealth executives say its tech venture and tie-up are a win-win, and fintech insiders agree. In fact, it’s likely that broker-dealer/RIA and fintech arrangements like this one will become more common.
“I can absolutely see more financial institutions marketing their proprietary front- and middle- office technology platforms to other institutions,” said Gavin Spitzner, president of Wealth Consulting Partners, in an interview. “By offering a field-tested, proven solution, firms can bypass the painful work to develop and implement integrated solutions on their own.”
Spitzner points out that United Capital is leasing its FinLife CX, or client experience, platform to unaffiliated RIAs. While clients will “pay a premium” for this technology, the tie-up can help them “improve speed to market and leverage a known quantity,” he says.
Popular industry blogger Michael Kitces said on Twitter: “Woa. This is a really big deal from an industry perspective. Another example of how advisor platforms are turning into (licenseable) fintech platforms. Akin to [Joe] Duran [and United Capital's] Finlife shift?”
According to Commonwealth Financial CEO Wayne Bloom: “We could not be more thrilled with this agreement, as it represents a win for all involved. We’ve been investing in and evolving our technology … for more than 15 years, and it is so gratifying to know that a firm of the caliber of MassMutual wants to use it to help its own advisors.”
