Examining Two Industry M&As
In a deal that combines two fiduciary training and technology solution providers, Fi360 has acquired the Center for Fiduciary Management (CFFM). Talking through the motivation behind the acquisition, Bill Mueller, Fi360 CEO, says that compatible corporate cultures and a shared vision for the long-term future were both top factors in getting the deal done.
“I first met Scott Revare, founder and CEO of CFFM, more than a year ago, and it became evident quite quickly that he had a similar corporate outlook to ours—one that’s very client-service-oriented,” Mueller says. “I got the feeling right away that [CFFM] understands where the industry is going. The process unfolded all the better as we found out that they have some key pieces of the puzzle that we didn’t.”
In particular, Mueller says, he looks forward to integrating CFFM solutions such as FirmPlus, an investment due diligence platform, as well as RFP Director, a research and RFP management platform, and Stable Value Navigator, a third product that offers data and insight about stable value funds along with an opportunity to compare advisers’ fund choices.
On the same day Fi360 announced its acquisition of CFFM, PLANADVISER also spoke with Cathy Clauson, senior vice president for investment product management, retirement plan services at the advisory tools and solutions provider AssetMark. The conversation marked the third anniversary of an important acquisition in that company’s development—Aris Corp. of America, which provided financial solutions to advisers and their clients.
“That integration effort started with the relatively easy migration of the high-net-worth business,” Clauson observed. “But the next task was moving the retirement plans business, which they had been running since 1974. It’s really interesting to look back because, at that stage, the plans and relationships were all still highly manual and highly customized, client by client.”
The Aris retirement advisory business had started as an entirely in-house operation conducted by a single attorney and staff actuary.
“They would just build out single plans for clients,” Clauson says. “They would build you whatever plan you wanted, and we inherited that. So our issue was that we had great expertise and great advisers coming on board who really knew the retirement business inside and out, but it was not scalable at all.”
Clauson and company spent over a year—most of 2016 and into 2017—studying that business and mapping it over to a more scalable solution.
Another interesting advisory market development came in the form of an announcement from broker/dealer (B/D) Cetera Financial Group, which revealed the launch of a new 401(k) practice development program tailored for its advisers—both those currently serving retirement plans and those seeking to expand into this market.
According to that firm, the program features a “robust curriculum of live, web-based training sessions supplemented by industry-leading resources and tools.” It has been developed with Nationwide Financial and KnowHow 401(k).
Reflecting the language used by Fi360 and AssetMark, Cetera says its new program “demonstrates a long-term commitment to supporting retirement-plan-focused advisers by expanding the firm’s existing offerings, and it will help to extend our focus on holistic advice to more participants.”