Tech Review: ByAllAccounts has built its company brick by brick and the result is a solid product

ByAllAccounts of Woburn, Mass., was born into a pool of competitors at the height of the dot-com boom. Today it is one of the last ones standing when it comes to account aggregation. When the bubble of the 90s burst, most competitors either shifted their focus away from account aggregation or went the way of so many hopefuls: nowhere.

Since 1999, ByAllAccounts has honed its aggregation techniques to accommodate an extremely broad range of data and continues to provide a customized tool that gets the data advisors need, regardless of the source. A 2004 Investment News article highlights some analyst claims that account aggregation began as an idea ahead of its time and has yet to catch on. Today however, ByAllAccounts continues to grow and diversify its user base; it would appear that account aggregation’s time has come.

ByAllAccounts’ big differentiator is that it doesn’t differentiate; data are data. ByAllAccounts can pull data in HTML, Quicken, CSV, OFX, and various format combinations and spit them out in a format specific to your portfolio management system — most often a CSV file. PDFs are a little trickier but the company has successfully incorporated this format, as well, to get at data other aggregators haven’t been able to reach.

“We don’t care what we pull, we don’t care where we send it to,” says Karla Paxton, technical relationship manager.

With its 10-year head start on building specialized technology and expanding its data store through a broadening customer base, account aggregation services just starting out are going to find a tough competitor in ByAllAccounts.

I drew a parallel between the services that ByAllAccounts offers and Mint.com’s offerings for the banking world. Mint.com aggregates bank account data to help consumers get a big picture of their finances, from credit cards to checking accounts, what they buy and what bills they pay. There are rumors of Mint.com getting into the advisor space, so ByAllAccounts may have a future contender on its hands. As it stands now, however, ByAllAccounts remains the kingpin of the account aggregation niche.

Paxton spent 12.5 years at an advisory firm before coming to ByAllAccounts, and last week she gave me a great demo of ByAllAccounts’ services.

Typical Customer

ByAllAccounts currently has about 500 advisors using their platform. These advisors are typically small RIAs with about $225 million AUM, many of which are using Portfolio Center as their local portfolio management system.

“We have firms that have multiple advisors, we have firms with one advisor. We have really large outsourcers who have lots of advisors, we have broker-dealers,” says Paxton.

“We are getting more interest from custodians,” says Paxton, referring to those custodians who have come to terms with the fact that they will never have all of an advisor’s accounts under their roof. “A lot of them are trying to do it themselves, and realizing they don’t want to recreate the wheel,” she says.

Pricing

To use ByAllAccount’s services there is a subscription fee, based on which Custodial Integrator version you choose, a per account fee, a one time implementation and training fee, a $500 charge for entering an account that does not already exist in the system (but with 3500 URLs currently supported, it is rare that you won’t find what you’re looking for), and a validation fee for each of these new accounts to be validated. The new account fees cover the costs of tailoring the ByAllAccounts system to import and export data from a new source and validate that the source is legit. The process of getting a new site up and running in the ByAllAccounts system usually takes about two weeks. The time spent after that to validate an account may vary depending on the site.

Functional

ByAllAccounts has two main components: Web Portfolio and Custodial Integrator. The former is a web-based platform that lets advisors manage client accounts and the latter is a light-weight desktop application that manages the pushing and pulling of data into and out of local portfolio management systems.

Despite the interface reflecting its 1999 launch date, the workflow is clean and simple. No fancy graphics, icons, or colors: advisors can quickly navigate the web portal via top bar navigation and single window set up screens. The Custodial Integrator is even less aesthetic, but again, the single-window simplicity completes the task of importing data into a portfolio management system in a matter of minutes.

Web Portfolio supports all browsers, but the integral component of ByAllAccounts, Custodial Integrator, only runs on Windows; sorry, Mac users.

Web Portfolio

Advisors typically use Web Portfolio to group and manage accounts and to do some reconciliation. Even though the ByAllAccounts site also provides report generation, risk and returns, and market watch features, most advisors prefer using their own portfolio management system for these tasks.

Web Portfolio allows client login; a
plus in light of new SEC
Custody Regulations

The big point for advisors using Web Portfolio, is the new account access feature that allows clients, in addition to their advisors, to login and manage account information themselves.

The custody definition outlined in SEC Regulation 206(4)-2 subjects advisors with account custody to an annual audit. By letting clients login to their accounts online, advisors can avoid having full account custody.

“That’s why having the Web Portfolio compliance service is such a needed system right now,” says Paxton.

Add a new account

To add a new account for a client via Web Portfolio, advisors enter the name of where the account is held, like Fidelity or Schwab for example, and choose the URL that matches. There are currently over 3500 URLs listed on the “Full Setup” screen, “We add a few every day,” says Paxton.

URLs not in the list can be added by advisors. All an advisor has to do is type in the URL they need and go through the process of entering information like username, password, account type, etc. The URL request is then added to a queue for ByAllAccounts engineers who set it up (i.e. add specific ByAllAccount screens and gather information from the specific URL) and validate it.

Custodial Integrator

“Most of the time will be spent with Custodial Integrator, the only time you’re going to go into the Web Portfolio piece is if your adding, deleting [accounts] or if you have a question on a transaction,” says Paxton.

The majority of advisors using ByAllAccounts use Portfolio Center. There is a specific Custodial Integrator for Portfolio Center, Advent’s Axys and APX products, and TLM. For advisors using a different portfolio management system, there is Custodial Integrator Universal, which requires more initial setup and some code generation to process CSV files to suit your local system.

Advisors using APX or Axys are already using ByAllAccounts data in addition to the Advent Custodial Data. “We’re not looking to replace [Advent’s] ACD, but there’s some data they just can’t get through ACD, so they’re looking to us to bring that additional information into APX.”

Three step process

Custodial Integrator: a three step process
to get all your data in
one place

“Custodial integrator is basically a three step process on a day to day basis,” says Paxton. The first step is setup. Setup requires an initial configuration to tell the application where to get the data and where the data output will be (i.e. the output file(s)for your local portfolio management system.) This setup process will need to be completed every time an account is added. New accounts will also need to be mapped to their respective account numbers in your local system. This process occurs in the “Account Translation” tab in the setup window.

The second step is importing. An advisor can click the check boxes to receive data for portfolios, transactions, reconciliations, securities, initial positions, and six days of historical prices. “Say you go on vacation for a week, you come back and you’ll get your six days of transactions and your six days of prices; we always go back and get transactions but you can tell the system to go back and get six days of prices.”

The final step is exporting. Exporting creates a bunch of different files; a security file, a price file, a position file, etc. If I opened my portfolio management system at this point, I would find the same thing as if you were using a direct interface. In the case of the specific custodial integrator platforms for PortfolioCenter or APX/Axys, the data are automatically there for you to post.

After reviewing the output files, advisors hit “Accept” and the interface is reset for the next day’s import.

Conclusion

ByAllAccounts can boast a long history of good support, good quality data, and a broad range of sites it can aggregate data from. It has solidly established itself as the leading name in account aggregation and is making headway with not only small RIAs, but larger firms and custodians as well. ByAllAccount’s head start in this space and the technology it has developed to do the job, is making possible contenders rethink reinventing the wheel on their own.