Upstart advisors adopt look and feel of family offices

Upstart advisors adopt look and feel of family offices

Upstart advisors adopt look and feel of family offices Robo-advisors will find themselves in hot water and struggling to win market share if they don’t take a crucial next step, said the co-founder of WealthBar, pointing to the family office as a model.

“I think the next phase of online advising is in creating something resembling a virtual family office experience, one where clients can get complete financial planning, advice and wealth management online,” said Chris Nicola. “We offer insurance advice as well, which lends itself to the family experience because many advisors aren’t looking out for those interests.”

Recent moves in Canada and the U.S. suggest robo-advisor firms are increasingly attractive as acquisitions for large wealth management firms hoping to better manage smaller retail accounts while freeing up time for advisors to focus on high AUM clients.

But robo firms such as WealthBar say they’re in the game for the long-term and not focused on being bought out.

For it and others making that commitment, the goal is to make sure offerings are holistic, a sort of one-stop shop, said Nicola.

But WealthBar isn’t the only one taking a page from the upscale family office, with individual advisors increasingly focused on forging partner relationships and teams that allow for full servicing of client needs.

That means competition between independent robo-advisors and traditional advisors will likely continue to grow in Canada, even if more firms look to acquire individual players.

Nicola’s comments come as a U.S. report warns that more clients are liable to defect to automated services, especially if a fiduciary standard is not brought into effect fold. It also comes as the U.S. Labour Department unveiled new rules that would require financial advisors to carry a fiduciary standard, similar to what’s being debated for here in Canada.