Asset management giant BlackRock has partnered with alternative investment platform iCapital and turnkey asset management platform GeoWealth to allow RIAs who use BlackRock’s custom model portfolios to invest in private assets alongside traditional investments in unified managed accounts. iCapital’s technology will support a custom platform experience for these RIAs while using GeoWealth’s investment implementation platform.
iCapital’s recently launched Multi-Investment Workflow Tool aims to streamline the alternative investing experience for the RIAs. The tool, which iCapital debuted in earlier this month, allows advisors to process multiple investments in a single setting. Meanwhile, GeoWealth will give these RIAs access to workflows, reporting tools and investment management capabilities.
The integration between the three firms will help facilitate RIAs’ access to BlackRock’s custom models. The models combine private assets, direct indexing, fixed-income SMAs, traditional ETFs and mutual funds in one account.
In July, BlackRock partnered with GeoWealth to offer custom model portfolios incorporating private equity and debt funds alongside traditional ETFs and mutual funds to the U.S. wealth channel. The company has been trying to make inroads in the U.S. wealth market, identifying it as one of its greatest growth opportunities.
As the RIA industry consolidates, the growing firms that control 80% to 90% of the industry’s assets are looking to form partnerships to work with fewer asset managers and service providers, according to Jaime Magyera, co-head of U.S. wealth advisory at BlackRock.
BlackRock expects a lot of the growth in the private wealth space over the next few years to come from the model portfolio segment, especially when it comes to ultra-high-net-worth clients, she said.
“Part of this is bringing together a platform that helps an advisor personalize and customize a portfolio across public and private markets and then easily, conveniently implement that through a platform,” she said. “And what’s what we are doing through this partnership. Today, there are probably $4 trillion to $5 trillion sitting in model portfolios. We think in the next few years, it will double. That space—model portfolios, custom portfolios—is going to be the future of the wealth industry. But it has to be easy; it has to be implemented in a very convenient way.”
In recent months, asset managers have raced to offer more custom model portfolios and streamline the process of using them. On Monday, Goldman Sachs Asset Management revealed it was partnering with GeoWealth to build open-architecture custom models for its RIA clients using GeoWealth’s UMA platform.
“We’re thrilled to be partnering with these two industry leaders to build out the infrastructure needed to support alternatives in the same accounts as the rest of the portfolio,” iCapital Chairman and CEO Lawrence Calcano said in a statement. “Our deep integrations with GeoWealth and BlackRock will further transform the digital alternatives investing experience for advisors and their high-net-worth clients.”
