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Envestnet Details $30 Million Plan For Tech Ecosystem – Wealth Tech Digest #29

Key takeaways

✅ Envestnet Details $30 Million Plan For Tech Ecosystem

For our first digest today, Envestnet lays out $30 million for a new financial wellness tech ecosystem. This ecosystem is funded by the additional operating expenses the company is able to allocate. Unsurprisingly, the company was able to line up this funding after a year-over-year increase of 11% in revenue for the first quarter. In the company’s first-quarter earnings call on May 6 Pete D’Arrigo, Envestnet’s Chief Financial Officer, broke down how the $30 million budget would be used. He noted that $20 million will be used to support various technology initiatives. Also, approximately $10 million would be used for go-to-market and sales related expenses.

Interestingly, the CEO of the company, Bill Craiger, mentioned the firm is keeping its word to use its additional operating expenses toward the financial wellness ecosystem’s development. He explained how it is designed to connect the daily cash that people spend to their long-term investment goals. These plans come as Envestnet is zeroing in on three areas of focus to accelerate revenue. The first two areas are to capture more of the addressable market already on the platform and modernizing the digital engagement marketplace. The final area, which relates most closely to this new funding, is to open up the platform for expansion.

✅ Hybrid Advise Technology For The Digital Generation

For our second digest, we take a look at how the wealth management industry can leverage off of new digital tools. This comes with a greater need to cater to different client demands and segments for better engagement. The topic is highlighted by a recent article by the WealthObjects Blog. The article mentions that there is a growing recognition that the next generation coming into wealth will have different needs. These needs are centered around what they expect out of service provision. In particular, these new clients will expect high-touch service levels combined with digital in the channel of their choice. Uday Bhaskar Nimmakayala, CEO and Founder of WealthObjects, mentions that Digitalization is no longer a nice to have when it comes to client relationship management. It’s a must-have. It has become an essential part of Wealth management. He says that everything from prospecting, onboarding, and implementation should have some level of automation. Staying true to this message, WealthObjects themselves have a newly launched Wealth CRM and financial planning software.

✅ Ant Group Searches For Direction In A New Era Of Chinese Fintech

For our final Digest we explore how Ant Group is trying to adapt to the changes in the Chinese fintech sector. Even after its massive $35 billion listing in Hong Kong and Shanghai last year, Ant Group needs new ways to grow its business. The company was looking like a coup for China’s tech sector and capital markets. This was all put to a halt as Chinese regulators decided to crack down on them and other big technology firms in the finance sector. In April, Ant Group was summoned by China’s central bank so the company could correct the “serious problems” in its business. These demands meant that Ant Group needed to transform itself into a financial holding company. Unsurprisingly, this shift means that the company will be subject to regulations similar to those that govern banks. Despite this, the company’s roots in mobile payments still remain very strong. For Alipay, China’s digital yuan is actually set to reinforce its position. Regardless of these new regulations, Ant Group’s strategic pivots are definitely a good one for Chinese microfinance companies to follow.


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