Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(}function setPanelState(o){dom.root.classList[o?"add":"remove"](,dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

The wealth management industry is driving more money into the financial-technology sector, as asset managers and investment firms rush to keep up with client expectations.

Over the past five years, the rise of financial technology within the wealth management space has rapidly transformed the way financial advisers conduct their businesses. As clients become more digitally savvy, the industry is facing an avalanche of even more change to come, says Ian Russell, president and chief executive of the Investment Industry Association of Canada.

“A wider shelf of financial products, integrated with financial advice and delivered with increased technology, has improved the value of financial services and the convenience of access for clients, setting high standards for service and raising client expectations,” Mr. Russell said in an industry note last week.

Story continues below advertisement

Last week, Power Financial CEO Jeff Orr told reporters he plans to invest more money in fintech startups as the company looks to find technologies that can be incorporated into its business model and avoid disruptions that have hurt other sectors.

Widely known on the Street for its empire of financial advisers and investment products, Power Financial has spent $320-million in the fintech sector - with more than half the funds being allocated toward online robo-adviser Wealthsimple.

Startup financial-technology companies, commonly referred to as “fintech” providers, typically offer clients financial-service products that are more cost effective and easier to access than traditional bank offerings.

Since 2015, venture-backed fintech companies based in Canada have raised more than $900-million – with $200-million raised in just the first quarter of 2018, according to data provided by OMERS Ventures.

The disruptive influence of technology happened first in the travel and consumer retail sectors, but the next phase will include financial services, says Eli Broverman, co-founder of U.S. online portfolio manager Betterment.

“What we are going to see in this next wave is there is a bigger [effort] involved with growing those businesses,” said Mr. Broverman, during a keynote speech at the Canadian Funds Summit in Toronto. “The businesses tend to be heavier in regulation, products are more complex and the adoption tends to take a bit longer.”

Despite the early stages taking a bit longer, Mr. Broverman said he continues to see investors making more concentrated bets in fintech. Five years ago, there was only one venture capital round in the United States that exceeded US$100-million for a fintech business. Since then, financing has rapidly grown with more than 12 fintech “mega rounds” happening in the country – totalling more than US$2.2-billion in the first quarter of 2018.

Story continues below advertisement

While initially seen as a disruptor to the investment adviser, robo-advisers, such as Betterment and Wealthsimple, have now been working alongside the wealth-management industry launching business platforms for financial advisers who want to incorporate more automated procedures for client account openings and portfolio construction.

“It’s been well documented that moving processes like on-boarding clients, building and tracking financial goals and account reporting to digital, increases customer satisfaction,” said Josh Book, CEO and founder of ParameterInsights Inc., a financial-services research and consulting firm. “If businesses can’t even do these things well in our digital world, they are at risk.”

Asset managers WisdomTree Asset Management Canada and BlackRock Inc. both made announcements this month related to their investments into digital tools that will help propel the growth of exchange-traded funds assets among tech-savvy clients and advisers.

WisdomTree launched a portfolio management tool for Canadian advisers that can analyze more than 40,000 Canadian and U.S. mutual funds and ETFs, and 7,000 U.S. equity securities. The company originally launched the tool in the U.S. market last year, which incorporates data analytics from FinMason, a fintech and investment analytics firm.

In the United States, investment giant BlackRock Inc. announced it led a US$50-million investing round in microinvesting site Acorns, a mobile app that allows novice investors to dump spare change from everyday purchases into diversified ETF portfolios that include both BlackRock and Vanguard funds.

BlackRock declined to say how much it had specifically invested in Acorns but in a statement, Rob Goldstein, BlackRock’s chief operating officer, said “by deepening our understanding of how [Acorn’s] customers use investment technologies, we can apply those learnings across BlackRock to evolve the products we build for our distribution partners.”

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the author of this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to If you want to write a letter to the editor, please forward to

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies