Altruist, an upstart investment platform used by more than 1,000 financial advisors to build portfolios for clients, has partnered with its first financial planning software. The venture-backed company announced Tuesday that it now integrates with RightCapital, the third most popular financial planning software used by about 20 percent of the market.
“One of the most popular financial planning apps that [our advisors] use is RightCapital, so we had tons of feedback from our customers on how they wanted integration between our platform and RightCapital,” Ted Zhang, a principal product manager at Altruist, told RIA Intel.
For that reason, Zhang said that Altruist worked with RightCapital before others (it plans to integrate with additional financial planning software in the future). Many advisors who use Altruist also use Fidelity Investments’ eMoney Advisor and Envestnet’s MoneyGuidePro, Zhang said.
Both Altruist and RightCapital have focused on attracting “emerging” advisors, who tend to be younger than the average advisor and have higher expectations for technology. Those professionals often find that software built for wealth managers lacks a certain level of usability and design when compared to consumer applications they use all the time.
RightCapital, founded in 2015, continues to attract users and now ranks third among financial planning software, with 19.7 percent of the market. The most popular software, eMoney and MoneyGuidePro, have 33 percent and 30.3 percent, respectively, according to a January 2022 Kitces.com report.
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The same report also found that RightCapital led all other financial planning software in satisfaction across several categories that included methodology, support, ease of use, simplicity, and appearance. The report suggested that RightCapital could be pulling market share directly from eMoney and MoneyGuidePro due to “a rising demand for more advanced financial planning software (rather than ‘planning light’ solutions), as planning depth, technical accuracy, and comprehensiveness were amongst the biggest drivers of advisor satisfaction with their planning software.”
“In connecting the platform, [RightCapital is] streamlining the process, and just making it easier for our advisors. That's always at the forefront of what we try to do, to streamline things wherever we can,” Ted Denbow, vice president and head of sales at RightCapital, told RIA Intel.
Travis Gatzemeier, the owner and founder of Kinetix Financial Planning, an RIA in the Dallas, Texas area that works with about 35 households, uses both RightCapital and Altruist. The integration between the two will make his life easier and his clients will be able to see their financial plan, investment accounts and bank accounts all in one place, he said.
About 75 percent of Gatzemeier’s client accounts are with TD Ameritrade. The others he manages through Altruist (and Apex Clearing, the custodian the startup has partnered with). But at least 80 percent of his new clients are opening accounts with Altruist and Gatzemeier said he plans to move most of his existing clients to Altruist in the future.
“Everything's integrated into one platform, which helps me track the overall picture of their finances,” Gatzemeier said.
In May 2021, Altruist raised $50 million in a Series B round of funding from Insight Partners, a venture capital and private equity firm with $30 billion in assets, and Vanguard Group, one of the world’s largest investment firms with trillions of dollars in assets. Venrock, the Palo Alto venture capital firm that led a seed round of $8.5 million for Altruist in 2019, also participated in the Series B round.
F. William McNabb III, the former chief executive and chairman of Vanguard Group, has invested in Altruist and joined its board, and Ron Carson, the founder and CEO of Carson Group, is also an investor.
Holly Deaton (@HollyLDeaton) is a staff writer at RIA Intel and based in New York City.