The second round-trip Omaha-to-Kansas City drive -- three years after the first -- led to the win of Mariner Wealth Advisors' private client assets
Brooke’s Note: Mariner Wealth Advisors isn’t messing around. First it rolled in some breakaways, then it acquired a national wealth manager and hired away a business development officer from Fidelity. See: Big Midwestern RIA hires away a Fidelity exec to realize its $50 billion plan. This article is about how it is also going a new direction on technology — something that will be completed by month’s end. Oh yeah, it was only founded in 2006.
Orion’s announcement last week that it has supplanted Advent Software for the private client assets of Mariner Wealth Advisors, a firm that manages about $10 billion of assets, was four years, and two multi-state car rides, in the making.
On a bitter December day in 2007, Eric Clarke set off in his tan GMC truck with one of his top salesmen, Bill Wospoutal, to make a long-distance house call at the office of a big-time RIA.
The two men left the Omaha-based headquarters of Orion Advisor Services, LLC and drove across a “Fargo”-esque expanse of frozen-solid cornfields and cow pastures along the Missouri River.
When Clarke, president of Orion, and his colleague got to the offices of Mariner Wealth Advisors LLC in Leawood, Kan., they made their pitch for why Orion’s reporting software should replace the legacy system provided by Advent Software for private-client assets. Mariner was only founded in 2006 and has come a long way since then. See: Big Midwestern RIA hires away a Fidelity exec to realize its $50 billion plan.
The long way home
But their sales pitch hit a wall on one point that was important to Mariner: Its advisors liked the ability to make real-time trades using Advent’s Moxy and using a new vendor was a nonstarter without such a capability, Clarke recalls. Orion didn’t have a comparable trading app in its suite of software.
Clarke resolved to develop real-time trading capability as a result of the Mariner meeting. It took about a year to develop and then a longer time to properly test it. Then there was the issue of getting back in the Mariner door after making the improvements.
Now, four years later, Orion is announcing that it has supplanted Advent Software for the private client assets of Mariner Wealth Advisors, a firm that manages about $10 billion of assets. About $2 billion of those assets are private client and $8 billion are managed assets.
Katherine Calvert, spokesperson for San Francisco-based Advent says she is still pleased where Advent stands both with RIAs overall and Mariner.
“We are proud that Mariner continues to be an Advent client, choosing our APX platform to run their asset management business. The advisory business is a competitive marketplace – which is good for all of us – and Black Diamond’s best-in-class platform remains the leader in the market.” See: Update on Black Diamond-Advent merger.
Mariner is a serial acquirer with a stated goal of reaching $50 billion of assets under management, winning notice when it bought the advisory division of a national accounting firm. See: Big Midwestern RIA buys itself a national presence in deal with CBIZ. It has offices in Los Angeles, New York, Philadelphia, San Diego and Cumberland, Md., in the wake of its January acquisition of CBIZ Inc.'s wealth management unit.
Mariner chose Orion with its ambitious growth plans in mind.
“Orion will enable our wealth advisors to spend more time with clients and allow our management team to focus on expanding Mariner’s national wealth management footprint,” says Brian Leitner, Mariner Wealth Advisors’ senior vice president of wealth management, said in a release. Mariner declined further comment for this article.
Long sales cycle
“We went through quite a process with them,” Clarke says. “... We learned we have to use a real-time trade capability to win the larger reps.”
With the more sophisticated systems, trades can be placed with one custodian and be settled back where they’re being held. They also allow for block trades, rebalancing and customizations based on other factors, such as taxes. Assets at one custodian can be traded at another. What Moxy and other trading programs allow is for an advisor to work more freely in a multicustodial environment.
Moxy — as do many other trade order management systems — integrates directly with portfolio management systems to automate many rote tasks related to trading, such as portfolio construction, creation of block trades, and light re-balancing based on factors like tax considerations. These trading systems are especially powerful when using multiple custodians because they allow advisors to easily transmit, settle and allocate trades across multiple custodians.
“What Moxy does a good job of is bringing real-time data and allowing real-time equity trades,” Clarke says.
It took Orion a year to build the technology, mostly by using SunGard Data Systems LLC’s transaction network and FIX technology — an open-source trading protocol. But even then Clarke wasn’t ready to pitch it to a new prospect; he wanted to field-test it to work to work out the bugs.
Then, when it felt its technology finally was ready to pitch Mariner again it faced a final hurdle — convincing the company to let it back in the door. The first time Clarke was able to rely on a contact provided by his father but he was determined not to play that card again. Instead, Clarke was able to connect through one of his employees who earlier had ties to the company through a real estate firm. Eight months ago, two of Clarke’s salesmen made the trek to Leawood, Kan. and got started on a final process that led to the win.
One of the gratifying aspects of this software sale for Clarke is that Mariner Wealth is — literally — the poster child for Fidelity Institutional Wealth Services, which uses the Kansas company intensively in its marketing materials. Though Orion has had good success winning big advisors the last few years, it has had very little success in the Fidelity realm.
Fidelity’s list of third-party portfolio management system providers that are integrated into WealthCentral includes Advent APX, Black Diamond Performance Reporting Blue Sky, Envestnet Asset Management and Morningstar Office — but not Orion.
But Steve Austin, spokesman for Fidelity, says in an email that his company is able to assist its RIAs regardless of what third-party vendors they choose.
“Through our practice-management programs, we regularly consult with clients on their needs for wealth management technology. In addition, we support many of the third-party products that our clients choose to use, through workflow integrations from WealthCentral or direct data integration interfaces as is the case with Orion. We also offer negotiated discounts with those vendors for our clients to take advantage of. What’s most important is that our clients choose technology solutions that work best for their practice.”
Austin adds that Fidelity has negotiated a discount on Orion software on behalf of its clients.
The long way home
Indeed, Clarke says that being excluded from formal integration deals with big custodians like Fidelity isn’t as big a deal as it might appear — especially with big RIAs. The assumption, he says, is that the custodian will do what it takes to make sure the RIA’s third-party vendors synch up well with its central system.
It was also a big win for Orion in that Mariner is entrusting the software company with a panoply of services including billing, account opening, trading and reporting. In addition, Orion is doing an in-depth integration with Mariner’s existing CRM provider — Salesforce.com. Clarke says that the account-opening software works similarly to LaserApp.
A host of capabilities that started with a reflective trip back home along the Missouri River in 2007 in that tan truck.
“It gave us plenty of time to think,” Clarke says.
Here are some of the other instances of Orion winning high-profile accounts from competitors.
In this case, Orion won the account from Interactive Advisory Services:
In this case, Orion won the account from Schwab PortfolioCenter: