TAMPS are both old news (they were created over 30 years ago) and all the rage, as advisors increasingly seek to outsource (or offload) investment functions to spend more time with clients and prospects .
Kyle Wiggs, co-founder and CEO of UX Wealth Partners, wants to push TAMP even further into the future by leveraging an even hotter trend: artificial intelligence and machine learning.
UX is a single interface, multi-custodial TAMP with approximately 13,000 accounts and $2 billion in AUM. It was built from the ground up to be a true all-in-one, cloud-based platform and includes merchant and invoicing capabilities. The system is essentially sleeve-based with a proprietary order management system that has a built-in UMA and SMA, so advisors can do all their trading, reporting and rebalancing in one place.
While many fintechs focus heavily on UI – how the product looks – Wiggs, who previously worked at Curian Capital, believes the focus should be squarely on UX – how the product feels to use (hence the name).
“I think as a (fintech) industry we've done a poor job of collaborating,” Wiggs said. “Advisors use different technologies without ever understanding how they develop or integrate. There are various great ideas everywhere, but not the right connective tissue.”
It aims for the Xperience Platform to act as the “hydraulics” of an RIA, providing everything an advisor needs in one place, while also being able to fill in the gaps and connect the dots between a firm's existing technology.
Surprisingly, flexibility is essential for a product that somehow aspires to be everything to everyone. As such, UX APIs are user-centric and open architecture, which allows interfaces to be built specifically for customer needs.
“Not every customer needs to use us for everything,” Wiggs said. “We are a component.”
The same reasoning applies to the AI and machine learning aspects of the platform. Although Wiggs himself is an AI evangelist and believes strongly in the value that new technologies can add to investing, particularly in active strategies — the decline of which he claims has been grossly overestimated — he admits that not everyone is ready to embrace the car.
“Many still see AI not as a helpful tool, but as a clear and present threat to their jobs.” Wiggs explains. “We don't want to force it on anyone, but just show them that using AI and ML in specific capacities can be helpful. It's not for every customer, but it's a useful tool to have access to even if you don't fully embrace it.”
Make no mistake, though, Wiggs thinks AI is, inevitably, the way forward.
“Eventually human beings buying and selling investments will go the same way as smoking sections in restaurants,” he said.