How I Learned to Stop Worrying and Love My CRM

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When registered investment adviser Paul Spitzer set up his business in 2009 after a nearly two-decade long career at Wachovia Securities and A.G. Edwards, he got a crash course in customer relationship management programs.

Spitzer, founding partner of Advanced Practice Advisors, first tried two competitor products but one wouldn’t integrate with other applications, which made mandatory oversight of other advisors difficult, and the other didn’t fit his needs.

He blames his custodian for some of his start-up problems, saying it steered him to firms with which it had business relationships.

“Conflicts of interest do exist,” said Spitzer. “They may get a ‘consideration’ for recommending one vendor or another.”

With hindsight, he wishes someone had directed him to Advisor Xi by Tamarac, a suite of services ranging from CRM to model portfolio construction to performance reporting and billing. He says the software solved many of his firm’s technological challenges, including helping client-facing and back office functions “talk” to one another.

Advisor Xi is what everyone wants to be,” he said. “It’s the single most expensive component of our practice by far but….heck, yeah, it’s worth it.”   

Spitzer, whose La Quinta, Calif. firm manages about $113 million, said it is impossible for advisors starting out to anticipate all their technology needs. As a result, he counsels careful vetting of gatekeepers and consultants.

“Until you are sitting in your chair as a registered investment adviser, it’s pretty hard to determine what your needs and wants are,” he said.

Andina Anderson, managing director for sales and client relations at Seattle-based Envestnet Tamarac, declined to discuss the price of Advisor Xi but said the software is competitively priced given its efficacy.

“The word integration is thrown out really loosely nowadays,” she said. “If you are trying to cobble together multiple different systems that don’t really have any true relationship with one another, some of that data is getting through, some of it is not. It is usually quite manual and ends up, honestly, not being that useful.”

Advisor Xi can be customized to integrate many solutions from outside vendors.

Advisors can focus on client-facing and revenue-generating activities, thanks to the company’s Advisor Services feature that enables reconciled accounting data to be shared seamlessly across the Advisor Xi suite. Tamarac, which publicly-traded Envestnet bought in 2012 for about $64 million in cash and stock, has nearly 900 RIA clients managing more than $900 billion in assets under management for 2.1 million financial accounts, according to Anderson.

Thanks to Advisor Xi, Advanced Practice doesn’t need to have an IT department. According to Spitzer, Tamarac handles those functions itself provided that the company has a sufficient bandwidth and a secure internet connection.

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