GeoWealth, a Chicago-based turnkey asset administration platform, raised $18 million in progress funding funding, with BlackRock as a brand new lead investor.
Kayne Anderson Development Capital, who led GeoWealth’s 2021 Sequence B funding, and J.P. Morgan Asset Administration additionally participated on this spherical (the latter additionally invested in 2018).
In response to GeoWealth CEO Collin Falls, the funding will speed up new product growth on the agency, together with growing unified managed account capabilities to supply sometimes siloed choices like direct indexing, fixed-income SMAs or alternate options in a turnkey resolution.
In an interview with WealthManagement.com, Falls stated the agency hoped to spice up its product and engineering employees by 20%-30% to increase using TAMPs and the outsourcing of mannequin portfolios within the RIA channel from the mass prosperous into high-net-worth sectors and from funds and ETFs into sometimes siloed merchandise like alts.
“I believe there’s been validation throughout the board that alternate options are very troublesome to make use of for RIAs, particularly systematically in mannequin portfolios,” he stated. “I don’t assume it’s a novel concept that it’s been a problem for the complete ecosystem, which is why you’re seeing a lot funding in alternate options and the infrastructure behind it.”
As of the top of final yr, the GeoWealth platform supported greater than $28 billion in property, with almost 200 RIAs managing greater than 180,000 accounts with GeoWealth’s help.
The agency was based in 2010. Its know-how possibility helped advisors entry mannequin portfolios whereas offloading mid- and back-office wants, together with efficiency reporting, billing and portfolio accounting.
In 2018, the agency accomplished a Sequence A funding spherical supported by JP Morgan Asset Administration, adopted by JP Morgan and Kayne Anderson combining for 2021’s Sequence B spherical.
Final yr, Geowealth acquired First Ascent, a flat-fee asset supervisor primarily based in Denver. The acquisition boosted the mixed agency’s property above $21 billion. It additionally partnered with the Chicago-based agency Halo Investing, which helps advisors examine, purchase and handle portfolios, together with illiquid investments. This enabled GeoWealth to supply customizable structured portfolios as a part of a UMA.
Along with the product growth enhance, the brand new funding will assist GeoWealth clear up its stability sheet and prior debt and provide it with “dry powder” that Falls says can be utilized on future alternatives. With BlackRock’s fastest-growing phase being customized mannequin portfolios, he felt the partnership can be an “amplifier” for each corporations.
Falls stated GeoWealth didn’t really feel among the pressures different main gamers within the house felt by needing to persistently combine inorganic progress into the enterprise, permitting them to focus solely on RIAs.
“I believe GeoWealth continues to be a comparatively clear, earlier-stage enterprise that’s rising in a short time within the channel we wish to concentrate on,” he stated.
