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Wealthsimple to spin out advisory service into separate company

Wealthsimple | | Dec 2, 2019

Wealthsimple coin - Wealthsimple to spin out advisory service into separate companyToronto-based FinTech startup Wealthsimple is separating its direct to consumer and Wealthsimple for Advisors businesses and will transition the advisor-focused offering to a new company, BetaKit has learned.

“We’re currently focused on identifying the right partner to support your business on a future platform.”

Wealthsimple for Advisors is the company’s automated management platform targeted toward financial planners, investment advisors, portfolio managers, and dealers. The company announced the news to separate the entities in an email obtained by BetaKit and sent to clients on Monday.

Wealthsimple plans to announce the move on Tuesday morning. In a statement to BetaKit, the company noted that Wealthsimple for Advisors will transition in the coming months, and is currently looking for partners to support advisors on a new platform.

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“We are at a pivotal stage in our business where we have a very real, very unique, once-in-a-generation opportunity to transform financial services for Canadians,” said Michael Katchen, co-founder and CEO of Wealthsimple, in the statement to BetaKit. “To take full advantage of that opportunity, we need to be laser-focused on delivering transparent, accessible financial services to consumers, both directly and in collaboration with our institutional partners.”

Wealthsimple called the new company a strategic decision to help further its vision of becoming the primary financial institution of its users through a suite of direct to consumers services, as well as institutional partnerships.

The Wealthsimple for Advisors platform allows advisors to streamline client onboarding, account management, and compliance through front- and back-office solutions. The service launched in May 2016. The company said this most recent move allows its advisor platform to focus exclusively on serving financial advisors, which currently consists of hundreds of advisors.

The platform allows the advisor to retain full ownership of the client relationship and allows advisors to set the fee that a client pays, charging up to a 0.35 percent management fee. J-F Courville, who has been heading up the advisor-targeted business since May 2018, will continue to lead Wealthsimple for Advisors as CEO.

See: Wealthsimple Acquires Tax Software Company Simpletax

“Over the past three years, we’ve had the unique opportunity to build a platform to support you as you serve your clients,” the company wrote in the emailed statement. “During this time, we’ve also had the opportunity to learn from you and to see firsthand the incredible value you provide to your clients every day. We believe that there is a tremendous opportunity for technology to enhance your work, and to help transform your business.”

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