FinFolio: A Portfolio Management Software Targeted To RIAs With $200 Million AUM And Up

Friday, February 10, 2012 17:26
FinFolio: A Portfolio Management Software Targeted To RIAs With $200 Million AUM And Up

Tags: asset management | family offices | Portfolio Management Software | RIAs

Matt Abar, a rock star among portfolio management software geeks who made millions selling his first PMS company to Advent Software a decade ago, is back.

FinFolio, which I wrote about three years ago, has now launched in 20 RIAs and it’s a serious contender.  The slidecast tells the story in detail.  

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Abar says he is targeting RIAs with $200 million to $2 billion in assets under management, “although we do have clients larger and smaller.”
Abar says the software starts at $11,000 a year for a single-seat license and goes up from there depending on the number of seats purchased.
“If RIAs want it cloud-hosted, we contract with RackSpace,” says Abar. “We will install the server for them and get them up and running and they manage their own data then. So that can have control of the database and yet have it in the cloud.”
Of the 20 or so RIAs using FinFolio, just one is using that configuration. The others are hosting in-house. Remote users can a VPN to access the program and run reports.
Abar says he has not created a service bureau that will download for RIAs and run a hosted version of the app because that market is too crowded with vendors. Instead, Abar is focused on larger investment advisory firms that want to “in-source,” those with IT departments and staff to manage their data.
“Firms that want to in-source tend to be medium to large RIAs with $200 million under management and up,” says Abar. "If you are below the $200 million level, outsourcing is better for you.”
Abar says RIAs with more than $200 million “should look at technology as a strategic differentiator between your firm and competitors.”
FinFolio mainly serves RIAs, Abar says, but works with some money managers and family offices. Since it does not offer integrated real-time trading, it is not a good fit for money managers.
How’s his new venture different from Techfi?  “It’s better software than Techfi,” says Abar.
“Also, Techfi cranked out add-on apps like a CRM on top of our portfolio management system and, looking back on it now, we did not do a great job of it. Now, we will stick just with portfolio management.
“If I had the same mindset I did at Techfi, we would already have moved on to the next product,” says Abar. “But now we are refactoring and building the best software out there.”


Comments (7)

As one of the few Techfi holdouts who had to scramble to move on after we were abandoned, giving any more money to Mr. Abar would NEVER happen as long as I am alive (or in this business...which probably makes the "alive" part a true statement indeed)
thefeeonlyplanner , February 10, 2012
I understand. And you're not alone in that sentiment. But.

-- You can't blame a 29-year-old software programmer for taking the $12 million he personally pocketed on the Advent deal. Most people would do the same. Please tell me if you would not.
-- Matt learned valuable lessons about the importance of integrity. My impression is, he would like to undo the stain on his reputation and prove himself to people who feel like you do.
-- A buddy of mine who swore up and down like you did that he would never deal with Matt again, bought his software about six months ago because Matt is really good at making PMS apps.
-- Matt dreams about this stuff and he really is brilliant. And now he is a much more experienced businessman.
agluck , February 10, 2012
Well, in this business sometimes integrity is the most cherished characteristic and once you lose it you are not getting it back. At least, that is how I personally feel about it. Back in the late 90s I swore I would never do business with firms like Janus, Putnam, etc. Burned once, shame on you, burned twice shame on me...or however that saying goes. Posting pics on his blog about the different ways he was spending his windfall while the customers who were primarily responsible for it were being "enhanced" and then "taken out and shot" by Advent sure did not help either!
I have start up clients and I have no doubt in my mind that he is thinking along the same lines again. Maybe I am wrong and I am sure as hell not going to participate in his success one more time! I am holding myself back for making these posts more colorful!
thefeeonlyplanner , February 11, 2012
It'll be a cold day in h--- before I go through that again with Matt Abar. Money or not... integrity does mean something, as does the lack of it.
lkayfetz , February 14, 2012
With respect, none of you were in the room when the decision was made. Despite our success, Techfi was not profitable yet and unfortunately needed to raise money at the same time the VC market was collapsing (early 2002). Of the options we had, selling to a stable, profitable company that intended to invest in our growth far and away seemed to be the best call for our users.

If not for a perfect storm of problems largely outside Advent's control, the acquisition would have ended with happy users and a rapidly growing new business segment for them. I regret that it ended the way that it did, but suggesting I flipped the company for some easy cash is simply not true. Personal gain did not factor into my decision to sell Techfi.
MattAbar , February 15, 2012
We are currently in the demo process of FinFolio because of the need for customized reporting of performance towards achieving goals.

Based on what I understand the sale was in order to attempt to fund a best in class system - something the buyer did not share vision wise.

That being said, I would warn RIA firms to ignore this offering at their own peril. After only a few hours with the framework, it is quite extensive and well thought out. Firms embracing such a mindset will be able to demonstrate their differentiation in a homogenous market place.

My simple question, if you own/operate an RIA firm, why continue to use off the shelf products built for the broker/dealer market?

brentb843 , February 15, 2012
Well, we can go back and forth on this for ever. It is my right to believe what I have stated and we both can't do anything about that now. The speed by Advent to kill Techfi shows a lot what were the true intentions behind the deal. This had a traumatic effect on all Techfi users who have stayed away from all startups...and I regret that since we need the innovation in this area so much.

As long as I am alive I will not be buying anything you have your hands on because I will never forget the hell you put me through! Case closed. Wish you and your current clients the best.
thefeeonlyplanner , February 16, 2012

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