United Capital is adding a new tool to its technology suite to help advisors make financial planning more meaningful for clients.
The Newport Beach, Calif.-based firm, which calls itself a financial life management company, is acquiring FlexScore, a consumer-facing financial planning tool that aggregates users’ financial data to generate a credit score-like number of a person’s financial health. Once the investor knows their score, FlexScore provides actionable advice on how to improve it that is tailored to the user’s unique financial situation and goals.
United Capital CEO Joe Duran said FlexScore stood out from the competition with its ability to keep users engaged. And while United Capital RIAs will continue to use more advisor-based planning software, Duran said none provide the same client-driven experience as FlexScore.
“The scoring and the gamification are very unique,” Duran said. “[Investors] can actually measure, like a Fitbit, how well they are doing in their planning.”
Duran said the ability to digitally track and measure performance is the direction the entire industry is heading. While other firms work on building or acquiring automatic investment management programs to compete with robo advisors, Duran said United Capital can stay out in front by digitizing financial planning and guidance.
The gamification element also makes FlexScore a natural complement to other tools in United Capital’s Personalized Guidance System, such as the Money Mind Analyzer game and the Honest Conversations exercise. The integration of FlexScore will help clients who can’t afford an advisor begin the financial planning process, and United Capital can provide a consistent digital experience—and eventually a human advisor—as their wealth grows.
Or as Duran put it: “move from coach into first class.”
Jason Gordo and Jeff Burrow, two California-based financial advisors with a combined 27 years of industry experience, created FlexScore with data from a survey of 50,000 advisors on how they go about financial planning. They created a 1,000-point scoring system based on how investors are building their nest egg, and how they are funding it. Earning a maximum score of 1,000 means the investor has achieved financial independence.
Gordo and Burrow introduced FlexScore at the 2012 Finovate conference and raised $4.7 million as of September 2014, according to Crunchbase. They sold their firm, Valley Wealth, to United Capital in 2014, but excluded FlexScore to hear out multiple offers from financial institutions.
Gordo said his experience and familiarity with United Capital tipped the scales. He added that while he can’t yet share specifics, he’s excited about where the product can go from here.
“FlexScore just plays really well to their tool kit,” Gordo said. “Joe [Duran] and I have had long discussions about improvements to the product and he definitely has some concepts and ideas.
“If you keep an eye on us over the next six-to-nine months, you’ll see some really cool product rollouts.”
Melroy Saldanha, CTO and technical co-founder of FlexScore, will also join United Capital, bringing his experience with artificial intelligence to integrate FlexScore into rest of United Capital’s “bionic advisor” efforts. According to Duran, artificial intelligence will play a key role in helping clients make better, data-driven decisions.
“We are looking to be the lighthouse for the independent advisor,” Duran said. “The place where they can be bionic and compete with any institution.”
