Advisors know meeting the expectations of clients quickly, efficiently, and consistently might make the difference between retaining a customer or losing one. Partnering with a tech-forward solution like a TAMP can help you maintain a competitive edge and therefore grow your AUM faster and boost your bottom line.
So, what's the best way to achieve results for clients while building your own business?
We know that a lot of Advisors lean on technology solutions to support their business. But how many is too many? One application might execute trades, one might generate statements and reports, and yet another might aggregate outside accounts. Piecing together separate functions from three (or more) different service providers may have served you well up until now. Opting instead for a Turnkey Asset Management Platform means multiple functions and services operating from an integrated platform – one screen, one login, one password.
TAMP stands for Turnkey Asset Management Platform. A TAMP is a SaaS suite designed to support your investment management business from end to end. You can break down a TAMP into two basic compartments: investment management solutions and technological tools. However, not all TAMPs are the same; the specific capabilities can vary, with some acting as a hands-on partner and others simply offering a tech tool you operate yourself. Most platforms encompass all the functions and features you'll need to create and track a client portfolio, including accounting, reporting, and reconciliation modules.
Advisors use TAMPs to offer a broad range of investment services to clients. Advisors can create and manage their own models and portfolios in this arrangement, or they may rely on asset management companies that provide professionally-managed model portfolios. The platform also automates many back and middle office tasks that are otherwise labor-intensive and may require in-house staff, such as billing and reconciliation.
A TAMP delivers efficiency and time-savings, which means an Advisor’s attention can go towards activities that build enterprise value. Whether an Advisor runs a one-person shop or manages a staff, the suite of applications helps save valuable time. Independent RIAs can allocate more resources towards acquiring new clients or enhancing existing relationships— pursuits that garner a higher return on investment than shepherding paperwork or using Excel files to communicate trade requests.
Growing assets typically holds its place in the center of the big picture. As AUM increases, so too does the need to manage that growth. Many TAMPs have the technological expertise to easily handle an influx of clients and the workload that comes along with them. So, rather than attempting to enter or reconcile customer and trade data in several different applications, a TAMP integrates trading, billing, and reporting modules, which reduces the odds of errors or conflicting data.
Transitioning to a TAMP requires an adjustment phase. Depending on the size and complexity of your organization, implementation times vary. A provider will need to migrate customer records, along with historical trade and portfolio data, from existing systems to a new one. TAMPs work diligently with ownership, custodians, and key operational personnel to minimize any disruption to the RIA practice.
Leveraging a TAMP gives Advisors an opportunity to smooth out wrinkles they previously had little time to address by offering a set of knowledgeable hands to support. Some TAMPs (including GeoWealth) assign each client a dedicated Relationship Manager who gets to know their business and assesses workflows in order to make suggestions on how to get the most from the platform and streamline targeted processes.
TAMP fees generally correlate to the amount of assets onboard. Expect to find a fee arrangement that ties to AUM, though the basis points charged will sometimes vary depending on the breadth of services used. You will find cost differences between various providers, and it's prudent to understand the various components driving the fees. For example, TAMPs that don’t have proprietary technology often pay to use components from other vendors, meaning additional fees are baked in. Since GeoWealth’s platform is proprietary and was built from the ground up in-house, it means we offer a flexible pricing structure that responds to each RIA’s book of business.
An industry once laden with literal paper trails has witnessed a steady digital transformation over the past couple of decades. As the digital age continues to change the way business gets done, TAMPs stand as an integral part of the movement as Advisors seek more flexibility and independence. And whether you recognize an enhancement in the ease of doing business or realize financial benefits, a TAMP can be the key to unlocking value and scale for an RIA.
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Not all TAMPs are created equal. To effectively drive the focus and competitive advantage today’s modern advisor needs, it’s important to know what to look for – and what to stay away from – in a TAMP partner. Follow our guide to avoid the five most common red flags we see in the TAMP space...