Editor's Choice Europe Fintech Wealthtech

Equator: Why Wealth Managers Must Invest in Tech

Garry Hamilton, Chief Growth Officer and founder at Equator, shares his thoughts on why wealth managers must invest in tech. 

Garry Hamilton, Chief Growth Officer

Few sectors have escaped change during the Covid-19 pandemic, but wealth management was met with a perfect storm of issues that will forever alter the industry’s face.

A toxic cocktail of miss-selling, an extended hangover from the previous decade’s financial crisis, and the rapid shift to online and self-managed investments have dealt blows to a historically resilient profession.

Throw in a hefty compliance and paperwork burden, along with a legion of wealth managers reaching retirement age, and it’s fair to say many firms have been buckling under the pressure of a resourcing crisis.

And yet, while all of these events leave the future uncertain, a considerable growth opportunity is within reach. For the time being, at least, consumer borrowing is at its lowest since 1994, with global savings swelling by $5.4tn. In the UK, more fortunate households were able to put away more disposable income during lockdowns, while the recently ended furlough scheme protected millions of incomes.

While we should remember that the pandemic has taken its toll on some people, others will seek ways to grow their wealth. Modern digitally enabled and reputable wealth businesses are in the perfect place to capitalise. But to succeed, they will need to secure funding to drive the digital transformation of their business.

PE’s role in the future of wealth management

There has never been a better time for wealth management organisations to seek funding for growth. Opportunities to bring scale and drive profitability abound – and Private Equity (PE) has the expertise to deliver.

PwC notes that in the last quarter of 2019, mergers of wealth management firms topped $26bn across 50 deals. The deal value is strong for the wealth business, typically courting over seven times EBITDA.

Consolidation and acquisition in the PE space will likely continue to grow. With so much dry powder in PE, the opportunities for consolidation and profit with wealth management businesses are clear. 

The technology that will drive a digitally-led future for wealth management requires investment, and that’s the apparent role of PE in this space.

As part of an in-depth study into wealth management digital transformation, we considered the strategy behind investing in a tech stack that’s fit for purpose.

In broad terms, a successful approach is built on eight actions:

Be diligent – Without a strategy in place, acquisition can smash together disparate technologies and actually undermine efficiency until problems are fixed. A robust digital assessment of core business platforms, ERP systems, and sales and marketing solutions is needed to determine the required planning and budgeting.

Harness AI – Cutting-edge technology is already addressing many wealth management pain points, from admin tasks and managing risk to scaling. It’s therefore imperative to assess current AI adoption and plans for its future use.

Beware roadblocks – Technology allows wealth management firms to find new opportunities to improve staff effectiveness and customer experience. Reviewing business needs and obstacles will help firms align existing or new tech to the needs of internal users and external customers.

Optimise CRM – Measuring marketing activity on any scale is tough without having an integrated CRM strategy in place. Integrated, cloud-based CRM is the most effective tool for consolidation and extracting value. The correct configuration will allow the business to exploit automation and drive new fee-earning opportunities.

Choose wisely – At the heart of any web offering is the Content Management System (CMS), the core platform for growing and managing digital presence. Make this a part of due diligence to discover what tech is needed now and for the future.

Be creative – Content is key: research from CMI shows that 72% of marketers believe a focus on content has increased their number of leads. Regularly delivered through careful distribution channel management, thoughtful content can prove a powerful lead generator and loyalty builder.

Improve search – A comprehensive search strategy is a crucial lever for customer acquisition. Get it right, and you have a platform for growth. As you grow and consolidate, ensure that scale and localisation are realised in a strong presence on Google – a strategy linked directly to content production.

Level-up analytics – With a properly implemented setup, a business learns and can adapt its digital operations in real-time. It’s critical to ensure all CRM efforts are measurable and accountable, so web analytics must be robust and accurate. This minimises waste and brings efficiency to sales and marketing operations.

Grasping the opportunity

In a post-COVID world, the opportunity afforded by PE is fast becoming an obligation. Many businesses that cannot scale digitally without funding risk being left behind in a sea of fast-paced, tech-agile competitors as a golden opportunity slip from their grasp.

Conversely, a combination of Private Equity and wealth management points to a bright future. Placing a comprehensive digital transformation strategy at the core of investment ensures value creation, makes a business more easily scalable and delivers a thorough competitive advantage.

As a result, tomorrow’s wealth manager will be digitally enabled and customer-centric.


  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

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