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Investment Platforms Are Disrupting Themselves…Again

Since their birth back in the early ‘90s, investment platforms have promised to be the answer to all of the challenges facing advisers in their daily business. But how have they performed so far? Is it time they gave up?

3 min read

Of all nine countries Caroline Naylor-Renn has found herself working in over the past 20 years, she noticed that advisers all grappled with similar problems, all asking the same burning questions:

  • How do I attract new clients?
  • How do I give the best advice?
  • How do I run a profitable business?
  • How do I keep clients happy?
  • How do I stay on top of constant regulatory change?

In theory, there’s one answer that can be applied to each question and that is platform integration. However, finding a platform that provides a more-than-adequate solution for every problem has so far proved challenging.

The early years

“At first, platforms were just about the technology; an online application rather than paper, it was a way of seeing all your investments in one place,” explains Caroline, Chief Operating Officer at INN8.

“When building my first investment platform in the UK 17 years ago, we constantly worried about whether our technology was cutting edge enough to attract advisers, but not so avant-garde that advisers weren’t ready to adopt.

“Interestingly, we’re still grappling with getting that balance right today.”

The middle ages

It wasn’t long before platforms evolved and the race for funds began.

“Advisers wanted access to a broader range of funds, so every platform scrambled to sign up more and more Mancos to their list,” recalls Caroline. “At the time we worried about how many is enough. Five hundred? One thousand? Two thousand? When is too much choice a bad thing and when do you stop?”

When you find out at that 90% of flows only went into the 150 most popular funds, that’s when.

Following what Caroline calls the “fund universe phase”, the focus shifted back onto tech, this time with the introduction of adviser tools.

“Risk profilers, asset allocators, portfolio scanners – the list of online toys was endless,” explains Caroline. “The only problem was that every platform had their own version of a tool, forcing the adviser to use each platform’s tools by embedding them into the online journey.”

The result? The poor adviser had to learn how to use lots of different tools for different platforms with varying success.

Are platforms dead? Or is it time for a new era?

Over the years, the flags proudly planted on top of milestones have long been forgotten and the pioneering phases have settled down. While good tech, relevant fund choices and easy-to-use adviser tools are all still important pieces of the jigsaw that is a good platform, Caroline suggests that there are now more features to add to list. “Data validation, system integration and reporting are critical in today’s rapidly advancing South African market,” she says.

“In my view, it’s no longer solely about the technology. Most compliance officers are now comfortable with the idea of paperless online applications and, increasingly, advisers are looking to platforms to help manage their compliance requirements.

“Finally, and most importantly, advisers are looking to platforms to mirror and enhance the customer service experience they are aspiring to give their clients. With many advisers using a number of platforms to fulfil their clients’ needs, it appears that no platform is getting the customer service aspect right.”

The one answer to all the burning questions

Having worked with the advisers who asked the burning questions, Caroline is now on a mission to offer a platform solution that addresses every need in the best possible way – including customer service.

Let’s look at those questions again:

  • How do I attract new clients?
  • How do I give the best advice?
  • How do I run a profitable business?
  • How do I keep clients happy?
  • How do I stay on top of constant regulatory change?

While platforms offer an easier way to manage clients’ investments, INN8’s proposition also has the potential to enhance advisers’ customer service. It offers advisers 100% control over their clients’ investments via features like real-time processing, 24/7 access to their online dashboard and exceptional reporting options which improve their business’s service instantly.

Advisers are able to pull up reports on request and flip through clients seamlessly all the while having access to their business’s overall performance. This not only gives advisers more control over how they do business, but frees up time for further educating themselves so they can do what they do best: advise clients.

And all of that while being RDR compliant?

“A new phase of platform evolution has begun,” says Caroline.

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