Manoj Pillai (left), Allan Maitland and Paul Kelly

Succession planning and the role of technology remain two of the most pressing issues in financial advice. The acquisition of the Futuro and Insight Investment Services licensees by Perth-based fintech PictureWealth seeks to address both of those issues in one fell swoop.

Picture Wealth’s acquisition of Futuro and Insight for an undisclosed sum, announced this week, gives PictureWealth a national advice footprint and creates a succession plan for Futuro’s co-founder Dennis Bashford.

Futuro and Insight directors Paul Kelly and Manoj Pillai have moved to PictureWealth, which was co-founded by David Pettit, Marko Sekez and Neal Cross, and is led by directors Pettit, Sekez and Allan Maitland. Cross remains a shareholder but has no operational role in the business.

PictureWealth has about 10 employed financial advisers, and the addition of Insight and Futuro will lift the number to 113 nationally. The PictureWealth group will have about $5 billion of funds under advice – up from zero five years ago.

The move comes as the future of licensee business structures comes under scrutiny, with licensees increasingly find themselves under financial pressure and questions being asked about sustainability and viability of current models. This will be a central theme explored at the Professional Planner Licensee Summit on 19-20 June.

Kelly says the transaction will allow the licensees to deliver technology-based solutions and services to help advisers improve the performance of their businesses, including through better collection, management and analysis of client data.

“From the planners’ point of view the same people are still running it,” Kelly tells Professional Planner.

“Yes, there’s some new ownership in there, but they’re bringing a lot to the table. For all, it should be a much more enhanced offering for the advisers and they can benefit from that quite enormously.”

Pillai says the cleanest way to create an effective succession plan for Bashford and position Futuro and Insight was to extract those AFSLs from Highfield Group, which also owns the Sterling Investment Services managed accounts business.

“A long the journey, what we wanted to maintain was the integrity of our network as it is, the continuity of what we’re doing, and also find the partner was going to support that all the way through,” he says.

“We need to take something different to the marketplace whilst doing this, and I think we now we have that competitive edge with what David and Allan have been working towards.”

Future proofing

PictureWealth’s Pettit says a new generation of licensee leadership is moving the industry much more towards a focus on technology to improve business processes and client relationships.

“We believe in advice, we believe in the future of advice, we think there’s a new leadership coming through,” Pettit says.

“That’s us participating in Dennis’s succession. He’s a pioneer in the industry. The shift that is coming though we believe is going to be technology-led. Systems in the industry at the moment are disparate.”

Pettit says the firm wants to mobilise data and information to better empower advisers to better understand their business and clients.

“And to surprise and delight them with access to financial data and information so they can do what they do better,” he adds.

Pettit says it is therefore not just a licensee providing a service, but everything that can be delivered by technology to improve client outcomes, as well as business efficiencies like cost reduction, improved profit margin, and more predictable workflows.

Structured formation

Pettit says the benefit of deploying PictureWealth’s technology across the licensee networks is that it allows the licensees to gain an aggregated picture of what’s going on with clients and practices.

“Licensees have got legal rights to data and information on behalf of all of their authorised representatives and all of their clients,” Pettit says.

“But there’s no one dashboard that shows any licensee everything that they’ve got. We will mobilise all of the data of all of the advisers and all of their clients across the licensee to make sure that the licensee can run to its compliance and regulatory obligations to the nth degree.”

Pettit says it’s not about inviting advisers to then start to “interact with blank, unpopulated new software in their business”.

“You’re actually inviting them into a window of their business, and how they can have a collaborative relationship with their licensee, and fundamentally their client as well,” he says.

PictureWealth’s technology may not be widely known in the advice industry but Maitland says the firm’s 10 employed advisers have provided it with a live test environment.

“Over the last 15 or so months that I’ve been here, we’ve been able to work with 10 financial advisers, a full support team, a compliance team, and immerse the technology and use of technology in a live environment,” Maitland says.

“It’s been a really good experience to be able to work with that, get the robustness of the technology right [and] deal with the advisers on all of the issues that advisers have with technology, all the features that help with producing documentation, and streamline that process hugely.”

Kelly says it make strategic sense to have a fintech company as the owner of an AFSL, given what he believes advisers need to be doing now to remain relevant to clients in future.

“Let’s be really frank around it: if advisers aren’t picking up technology, getting a good handle on it, and making the most out of the data that’s in those businesses, they’re at risk in the future of becoming irrelevant,” he says.

“Data is gold. You’ve got to understand what your client bases look like; you’ve got have a deep understanding of your client.”

The systems Kelly is describing allows advisers to “drill down deeply” into the client, then move forward with more meaningful tasks.

“That’s obviously going to be vital and core for any AFSL – not just this one – moving forward,” Kelly says.

This article was edited on 29/5/23 to include Neal Cross’s status as a co-founder of PictureWealth

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