There is a huge amount of change happening in the UK adviser platform market. Our latest report, The Great Platform Shakeout, charts the rise of adviser-as-platform and points to the emergence of two other models, Whitelabel+ and Platform+ alongside third party platforms.

Rise of Adviser-as-Platform
We segment financial advice businesses into five groups. We think it’s important to look at the adviser market not as one amorphous blob (or a simple split by assets) but based on business models and characteristics of those firms. The factors driving decision makers are wholly different for a sole trader appointed rep compared with a national PE backed aggregator, for example.

The adviser-as-platform model is particularly appealing to two of our adviser firm segments: Investment Advisers and Investment Outsourcers. These are among the biggest financial advice firms.

• Investment Advisers mostly already have their own platform. They also have their own funds, using segregated mandates. Examples include SJP and True Potential. Nothing new here.
• Investment Outsourcers: These mid-to-large size firms use discretionary managers for models. Many are PE-backed and are growing through acquisition. They don’t run their own funds and advisers tend to be independent. We think about 30% will become platform operators.

Adviser-as-platform is not the only new show in town. In our research we define two other emerging models: Platform+ and Whitelabel+.

Emerging models, alongside Third Party Platforms

These three emerging models will exist alongside third party platforms. They will cause disruption to service models, price and the range  of services offered by platforms. Their growth will have knock on effects for back office systems and other financial planning toolset providers.

Most financial advice firms will continue to have a multi-platforms strategy. This is a really important point – it’s not an either or scenario.

The following defines the emerging models:

• Adviser as Platform: Large financial advisers become platform operators in an effort to reduce risk and improve operational efficiency. The client contract is with the adviser provided platform.
• Platform+: Platforms evolving to offer bolt on services to support client onboarding, regulatory compliance and operational efficiency. Examples include Fidelity Adviser Solutions + Conquest and AJ Bell + MPS.
• Whitelabel+: Scale platform providers offering digital first customised solutions to advice firms. Whitelabel+ model offers a hybrid solution – helping financial advice firms reduce risk and improve operational efficiency by offering access to APIs and bespoke integrations.

Dave Ferguson, Seccl CEO and Ed Dymott, MD at Benchmark will debate the future of platforms at NextWealth Live on 21 March 2023. Is the future about scale or nimble digital first disruptors. Get your tickets here.

Find out more about our the future of platforms and the Great Platform Shakeout report