- Earnings call transcript Q3 2022

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Operator

Greetings. Welcome to Envestnet Third Quarter 2022 Earnings Conference Call. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to Brian Shipman, Head of Investor Relations. Thank you.

begin. may You

Brian Shipman

Thank quarter everyone. joining on us Good earnings you call. third XXXX today’s evening, for

Before I’d Form for be press of being release, website. found we webcast our our the X our supplemental that begin, under a This presentation month like website to live. at on and call Relations And available associated Investor XX-Q envestnet.com. be out can section point is earnings will replay

based X on the performance. Slides information. is During information found in review we to This for not on results is discussing differ will and uncertainties I statement to from filings. our those future regular can other current be forward-looking certain our SEC the risks, a call, be you Further the of and factors cautionary expectations and information expressed guarantee could statements. actual X that cause by potential forward-looking encourage

referring refer reconciliation in non-GAAP we comparable During certain the financial presentation to GAAP call, non-GAAP measures. these website. of presentation Please measures. the our posted Relations measures The financial will most this Envestnet to also to directly appendix the for be is to Investor a

the results. Chief Joining our provide as Chief are call on Crager, Officer; to After we an overview Pete call Bill as open Envestnet’s questions. third well me Pete XXXX and prepared a company’s D’Arrigo, Financial Envestnet’s quarter and today’s Bill update, Officer. Executive will company the will of remarks,

one the Q&A, yourself During question limit one follow-up. please to plus

Bill. have now the that, will back get turn additional if into to questions. over may the With you You queue call I

Bill Crager

do. to position growth grown number earnings you navigate face are financial we for services a utilizing we active in that cycle call. our from of trend significant We’ve the This testament cycle, and and of D&A investments. our us, extend Thank and flows. as grown has you, we is Envestnet work. our while joining thank first, a to competitive the asset a on economic mandates supported We’ve We’ve important products and Brian. industry progress what generated third of is the serve. leveraging been digital there of that our won the is our Good advice. the growing. important downturn. Envestnet clients accounts global competed our very market is to the But share of in our by net nature forging grown everyone, quarter generate this essential the continues and is number updates evening, engagement accelerated intelligence a Envestnet moment. is this. connected, another transform hyper-personalized it for. understand super data, to I important powerful we’ve This at will Much users

the feed-based, We moment, years, becomes drove are industry. To a last it. independent Envestnet Envestnet’s core for so back you transforming essential When on how cycle, cloud-based, the advice the has over of become look the it Envestnet to evident at advice. step executing growth

while XXXX, a the to period the enabled platform XX% during total on the from our As to we assets industry CAGR movement at grew the time. at XX% only advice grew fee-based, of XXXX same

cycle, Today, the shareholders. our leading future the significant During again. are value created we we for

essential, is offer, these competitively Given to generation’s what ecosystem, more capabilities This the our more intelligent increasingly digital this us differentiated. super embedded, makes connected we cycle. drive are more beginning even

progress made foster capabilities towards digitize, that new streamline partnerships to business we margin expand expansion. on importantly, and and have streams. productive meaningful And continuing more path the across our generate are revenue We our

our above AUM/A peer industry Let me and both flows were of our spotlight In Wealth efforts. net some group. our from the positive, results segment,

to clients as past ours, gains year-over-year. This and something we and of current we’re number I’ve more adviser market focus conditions of the more serve, referred number as of that increased This an quarter, accounts During per are normalize, surprised increased accounts we the accelerated that not Envestnet services. drive X% the intended will the the of in utilizing growth is spring. and coiled

during We serve and also on use, a XXX(k) and wirehouse finally, saw planning revenue firm, roster, expanded as conversion and footprint we the the client national to national signed On a a we we’ve been which we of union, RIA with strong the fiduciary a solutions national expand who client, they solutions recently our by continue activity engaged our we growth. quarter. more that generates credit partnership

these million we and XXX% capture the users from XXXX. XX Data are meaning tax economics. number solutions, XXX% our In year-over-year million Envestnet and up and worth over for XX today, and also year-over-year our solutions. grown growth impact proprietary in of well XX% strong we have segment, especially We direct of notable Analytics solutions. as substantially high are in as managed to in These account our overlay growth as indexing, experienced growth over well net that’s the paid

conditions year to was tracked business. X.Xx estimated billion, As what that XXXX. in improve, another XX be of this are coiled we’ve be economic spring our will transactions it number for this is Total which

platform see from growing data getting derive as set. the vast You is insights smarter this we and

analyze is home for platform Platform launch incremental revenue connect, to million we we value allows XX the own and insights aggregate, the to publish of are It generates clients as offices also intelligence, protect Additionally, clear and of driving to the we day. our Wealth a grown example a creating over their advisers how number data. have and The growth. Data of extraordinary

needs their about Let the for important me opportunities or Insights this. clients. advisers explain tell most

Our in advisory business. data their clients for greatest of that lies book opportunity existing the shows

this unlocking for them. are We

an Here’s example.

XX% grown the overlay have in utilizing insights tax program, advisers insights have past months growth the while Over without experienced at assets, advisers XX within XX%. only

as insight growing flows, growth, will very faster is is more which in advisers up interest utilization our will So Envestnet. you which understand drives quarter-over-quarter. and XX% can experience why strong utilization, There more means

by last The to platform offering. insights more the I FNZ, wealth will expect something million annual capture topic data that will critical We wealth about. to leader revenue generate to and our marketplace continue of related solutions, this which platform greater usage additional generate growth the in highlight even XXXX, fiduciary from We a will than management of excited with solutions. incredibly partnership revenue global is a initiatives recurring in we’re announced recently $XX our

is FNZ. expanded custody, through captured engagement creation, integrated to value digital very in us We digitize and enables and to platform significant technology opportunities with clients’ execution with custody, scale create associated prospect with that Envestnet. revenue them our pursue from to with automate, fully are This partnering a fully end-to-end, step to to and another from will portfolio, it plan our environment client,

addition, Envestnet international FNZ to market. Wealth In the a represents will step for Data Envestnet their distribute wealth international major in which the Platform clients,

next in in hiring talent over Services resources driving as As the recognizing in allows well. Data Investing organization defining Analytics and and TCS, reached an transition we’ve the the This to analytics coming are that our this operations to industry, us $XX and our grow This this year, enables announced quarter. spur between giving cost generating operational seen years and in the ways an last savings we first solutions. marketplace benefit so peak us cycle expenses our completed been landscape the grow. Investing we we in this also Bangalore. of competitive by the data said, and personnel we investment-driven bringing scale, million Tata With and to Earlier the We’ve flexibility $XX outsource in managing business while agreement is to And recently is and these as many investing. partnership and future-oriented quarters, million the high-value capabilities Consultancy to this estimated the wisely expect saving intelligent XXXX. the transformational increase and to continues cycle. will and with resources. that

and environment also additional business our reconciliation realized scaling portfolio reporting our We’re impact with XXXX line will accounting, XXXX, bottom modernization trading, consolidating in This from positively to operating late and modernizing benefit capabilities. XXXX. our cloud Wealth for our by

ultimately into across create productivity significant put we our will seen As leverage have cost business. systems these efficiency and lift we a that production,

the Given of XXXX. the we the XX% first in compared by are will peak be believe Envestnet’s nearly taking, steps that quarter personnel we that lower year-end, to

the while We of to all are in our future be organization areas business. more rebalancing efficient in investing capabilities,

has of each the while also long-term Envestnet the Data integration to new family. Lastly, the client another RediX mandates exciting acquisitions of is and effort offerings. benefit that revenue component meaningful with cost business winning maximize additions our successful management is is a track, Truelytics these the recent to Platform. these on a key embedded integration impact now our new for of value of Wealth

say to to Workplace around me we market These can margin in targeted well result. to XXXX the for guidance as XXXkplans.com to also he XX% But streamline achieve immediately into remain as retirement to that, are committed a intended of partnership that that what acquisition are despite onboarding results as Pete and dividends this expect happy believe results. with to we the rest We’re are comments. of so delivering agreement turn provide we want by adjusted and UBS his the I of will EBITDA is share recently the entered the the very achieving investments taking this, expansion share steps plans. our With let we Pete year. paying results

Pete D’Arrigo

the responding created continues markets. strategic by Envestnet to capital while economy Bill. you, Thank our to the and drive proactively imperatives, headwinds

third $X.XX. the adjusted quarter, $XX.X financial and outperformance with contributed our adjusted million, of within million revenue per the adjusted share For earnings Both segments guidance our EBITDA exceeded the to results of quarter. $XXX of

outlook While unfavorable impacted the the bond segment, near-term again, equity and was QX Wealth adversely markets. performance for the in favorable, was by

flows peers. to QX, Importantly deliver continued most though, Envestnet well above net positive in

an XXX,XXX Over This adviser XX demonstrate of per XX%. of increase the bodes flows accounts importance Also, clients times. organic our posted we well net our the in platform growth AUM/A or the $XX of the billion through accounts of addition the over rate have asset to within longer for term. challenging months, and last continued annualized quarter

in manager business impacting pressure and the economy QX, as also and client asset fintech is to well Data Analytics Our base. continues face although performed its

to noted, transform Bill strategy small from emphasis consumers progress make with platform for as wealth management, subscription and segment model businesses. continue a this on we a product to we As content

toward will announced largest provides world’s saving progress margin which to as TCS we to companies, significant TCS, opportunity one partnership with like employees work our discuss I’d transfer effectively recently Envestnet partnership our allowed The which consulting of substantial future a allow Now for which significant to in to progress us immediate a goals. Envestnet, generate the years, scale In an in are business. get year making benefit we Overall, doing expense us growth with to consistent pleased expect this function should savings, the XXXX. area. we anticipated full with this in be the so, to of expense

year full the to our and XXXX. outlook the Turning for fourth quarter

our updating as are We guidance follows.

quarter, For to we to be EBITDA $X.XX revenues fourth the adjusted $X.XX share. per and $XX be $XXX to and $XXX $XX million, adjusted million million million to between EPS expect adjusted between and be

we the EBITDA expect to EPS For $XXX and adjusted revenues be million year, to million $X.XX $X.XX. between to adjusted adjusted full $XXX be between between billion, and $X.XXX be and and $X.XXX billion

as levels as of any the And markets always, the in end. guidance, changes based as assume such, September quarter XX. capital does market Our prior is not from on

XXXX, to until practice, as won’t guidance be standard ahead call giving in is next February. our Looking we specific our

X addition XXXX our However, financial XXXX market market annualization to of XXX XXXX challenges around top basis performance to to X September line and to XXXX. revenue to as market by revenue in affect the X a our taking these to Despite we approximately increase results, year’s do to I’d September growth expect rate, present but the would currently growth like context a of values headwind EBITDA of non-GAAP our rate. few impact XX, not to this roughly that market impact flow. the do points some add XXX to our around cash as consideration percentage compared in point items margin points free into XX, growth percentage X to levels of given also reported

in increases As our and we experienced capitalized we XXXX implemented as strategy in items, XXXX, software. such certain have broader have

of we cost practical the estate implementing We our the portions difficult real market have business, given a creating and series write-down very restructuring climate, of are a footprint. costs, consolidated of management including

and going several We growth we the rate expect expect we compared XXXX significantly to from down these to XXXX, in especially the to increase to down terms. come of items come areas saw forward, some absolute of

that, with I’ll continued EBITDA. for his million, September your today cash ended With $XXX We Envestnet. sheet. making balance the at Bill Looking the net million and in turn remarks. to $XXX of support our Thank again ratio leverage and for for approximately of it you joining debt closing call X.Xx back

Bill Crager

Thank you, Pete.

signed reported strategic new of flows steps historic drove we during partnerships. to despite to heard $XX we our that and We also net We the expanding billion services quarter onboarded you’ve the face. existing accounts the quarter ended, a tonight, quarter provide we headwinds over made positive As have platform. the and took net important After meaningful clients. new progress announcing clients X exciting we the XXX,XXX

with drive with us opportunities custody to partnership opens addressable revenues Platform. market for new FNZ Our Wealth associated multiple up and increased our Data significant

of partnership I ago, more long-term to lowering we and TCS we areas stated while immediately. growth creation. us scaling, value administrate allows are expenses our Our with efficiently, business, significantly as reduce operating a invest moments to the few the automating, And in cost

of our and expansion. X, this cycle capture digital Today, leg our we offerings. intelligence, for enables We again of executed. are once company are growth transforming strategy, super has and day business for while our the to executing value industry, engagement next significant it a accelerated the margin personalized leading data and Since creates which clients

We Envestnet and a is execute. are to of leading effectively, people indicator. even the essential Envestnet more more in, ourselves delivering our lean industry to making lead and clients. The more,

have With Operator? the once Envestnet positioned the again. questions. to ecosystem drive take to we happy are We future your that,

Operator

Securities. first Our with from Ryan JMP question Instructions] [Operator Devin is

Devin Ryan

one I custody FNZ talk have to little Just solution partnership. And question just sounds wanted bit interesting. a the about here. the

short-term should and And that to about opportunities we to in highlighted there? So both that of Envestnet positioned then some you revenue how the going the is long-term thinking be be how market?

Bill Crager

for Devin. us. partnership This exciting a is very

assessing that of we’ll We it’s some something our deliberate in through are we’ve and to the our introduce incredibly extend can -- that platform been how FNZ. include we services capabilities

partners. open the back foremost, and to trade First environment industry, in period. different is XX the custody We trading about important understand. architecture Envestnet to most and

digital the the the operating are and looking for the efficient they industry So we environments. a really that step, are Envestnet we we’re And But for advancement how network and options, This and work took industry we in advance with And our to more are step clients, with capabilities. extremely industry. mind conversations to is needs Envestnet partnership. ahead our driving complementary the FNZ together. this industry. partnership in more

States us We market, truly the the a international We and very right? geographies, also markets. have accelerating are they are into bringing is deal. complementary FNZ’s entry into United This global

working to a our have collectively we create also and complementary We how our and to growth clients, very profitability success approach approach also for clients.

We’re very aligned in that way.

client everything Envestnet the automated the will end, leading the we’ve full of the So the all FNZ, with deliver provide that FNZ, servicing a capabilities with includes the on for advanced today. opening will And technologies we and front offer most which digital life marketplace operating modernized that account, custody. cycle we and

I And are opens meaningful about, for of and so be kind It us. environment excited for over think end-to-end we’ll Envestnet it’s a which Devin. truly market, that to up digital new revenue streams the some we’re introducing time

you to be like that, management, platform enable there’s our cash As capabilities XXXX. use technology in services the technology We’ll of to our second utilizing noted other enable. lending, half custody, there’s platform also also market be will that able in we

that be to account of the very believe, think this, nature given we’ll we approach revenue we’ll the we and the and the But and what administration entry process, provide of kind a contribution standpoint, be forecast for real-time differentiated during has is I the of release nature As data to to produce that us. can opening do or that it successful. market, digital this able opportunity into start streamlined from

Devin Ryan

that customers that X to customers think Is if will way that custodians follow-up share that this platform? new understand on through revenue ways some just the partnership we custodying money, interact right the make up any And on Terrific. essentially can it and all with end that that. about Okay. have with Envestnet

Bill Crager

there addition client of with is That that, and international And Envestnet to to work is in partner base. FNZ’s distribution certain that, solutions will FNZ I Devin. exactly would just to add that the global right,

Operator

Alex is Our UBS. question next with Kramm from

Alex Kramm

surprised question. missed deck not the see in was numbers prepared unless or is update an in around to the I your solutions. I one a it, remarks, First quick personalized

the last given you for numbers, I to the thought account few in KPI last number major going you’ve was the quarter, and quarters, think AUM a I to even measure success. that be

So A, give any you didn’t And maybe can us reason B, a number? you it? why report

Bill Crager

the so pure Alex of it’s there. progress script, of but products just the kind mentioned, our I’d Yes. some We that mentioned supplement, highlight in simplify -- revenue thank a into you there. slide I gross revenue were bundled reformatted line And there. then wanted the and to -- the we in net I’ll

to So walk XX, Page you through it’s happy that. But Alex.

year-over-year are indexing, up despite direct assets X% the market. So

And product growth. of XX% growth, year-over-year. So the very strong is Accounts the up growth. using advisers are number asset index adviser direct XX%

progress lot a is XX% impressive advisers is the as given services and Accounts know, growth. that platform. asset been the advisers using overlay, an up billion up of of asset standpoint. up headwinds, Again, year-over-year market. the out year-over-year Sustainability, X% challenged X% clearly, are And So year-over-year headwinds assets from got $XX year-over-year. has the eking there. that on a you XX% performance as and are in well growth, the said, despite reasonably class by for performance accounts growing we’re We’ve sustainable on solution. That overlay

and to the of focus more asset ours. penetrate we focus, will and as So in of be a driver that we which remarks, which more base, it intended I a something highlighted continues major -- meaningful an prepared become is the growth our

Alex Kramm

the it bit. right, think, I view I really to was, to everything timely, overseas, TCS a think to Great. But your, as But up back I IPO numbers be you exact little days, key remember needed be a myself I I to cetera. et follow have dating wanted I’ll deal. here guess, when the gears everything Okay. on may later. shifting to control because be differentiator, organization and back-office you needed that the

forward, anymore that that, has that looking costs service I point don’t go the that, control the, may now it you at balloon as curious because some at what may guess, you all changed. worried the just lose you’re And So outsourcing I’m are control down. you or A,

are Is So as But this that’s road potentially the savings, actually related ‘XX to onetime number. maybe in $XX down that’s more $XX that, or this that. get just on Or and million any a to savings it ramps? opportunities touch that million to thing a there it? is

Bill Crager

Yes. Thank And the I back-office good we Bangalore, that. which why to One about office that and I’ll memory. and operations for you, and the Alex, say and transitioned substantial very business. -- for would we process our analytics, have we’ve data and talk continue thought TCS, in that’s X around

The that wealth supports other one in platform. is and Trivandrum, our

we can wealth that We the create continue a utilizing competitive back office. substantial the to believe wealth and infrastructure advantage,

However, and more $X.X it is advantaged? At at become in more at were out it to assets our resource Why continue But served. will competitively of efficient, serve this we’ll automated, Trivandrum so some point more we I’m business. wealth that and more to sorry. operationally year, peak -- trillion

we’re of of tens servicing millions trade and trading each of We’re million-plus millions XX accounts. blocks, millions quarter, blocks

scale have our a functionality platform. in and unique We wealth unique

versus and way scraping. and a with we’ve seen direct that more partnering did banking we’re financial to streamline Bangalore the from administrated an the Screen and network TCS We’ve operation, fix in committed business the open support it. a it, substantially screen direct hard, and connections the old-school operation that’s to data way that said, transitioned has pretty you institutions substantial the the TCS as the screen we’ll to That that is support with and around We’re which moves of required back-office to of -- connectivity, with we’ve of business driven. human scraping continue driven breaks scraping to invest that. occurred something system a more on, more

agility an open we pool near-term from cost and we savings effective administrative to volumes that saw opportunity leverage in as much more as the immediate and forward, scale former So be of TCS forward really with as is to banking, pretty $XX created look standpoint. that the from and transitioned to platform there we think screen-scraping But data which will in and million. way there an so create it there’ll transition that as savings, that cost million we ‘XX analytics to way, and grow, growing business, as more be noted, they’re substantially a go $XX more our resources

for in anticipate starting $XX that million grow. we will million $XX So that the savings, point is but to

Operator

Jefferies. Thind is next with question Our Surinder from

Surinder Thind

and asset much provide for Can For that been product? the in point, question, numbers the of update how people more there in at growth growth there of just maybe that users users more terms first of some it’s of impressive aren’t current point? bit platform the at the terms then what the you provided Engine, that the account Or in more that my the this And use product color much on more have is you that -- extent this Insights given that the number you and how penetration terms like on is? why available runway there is, rate terms to a maybe of versus very on the in nonusers.

Bill Crager

Surinder.

year-to-date. Insight early insights from the are say Usership is what growing by days, or We the I’d XX% Engine. the is recommendations of

insights of on roll it. it our Engine and but their Platform. rollout And business. so then to do? platform, it reconcile and of substantial away create to product publish we’re verify and And to Insight And the a that’s held really, across Insight the it, of normalize on to held all weeks the through to the take Wealth these marketplace. collects Data our to we is expands action the that’s that data to Data Envestnet a announced book to ago, It it, goes clients’ complete collect there that’s Wealth to data the tied introduce to the clients. solution for that But it, What’s Data that advisers the continuing out beginning Engine, Platform, Wealth very to Platform to the couple

of And of is to in solutions a the for its growth in because their book early grow insights so It current deeper drive we are in business. opportunity greatest to days penetration way our have on the platform. They’re tool are of the that purest advisers, the demand-generation utilizing of Envestnet very unaware that deeper they -- is it.

We’re it desktop, things And then workflow instance, the at execute. go the surfacing back of connect these to their and way through full all administration in the to the FNZ the account.

And one-of-a-kind, so adoption the a I transforming capability and way market, will it very truly a to believe making is quarters create its over that is substantial ahead.

growth We’re the I XX% just started. clear. And the XX% Engine higher is make getting then, I’m to want sure a at the of they’re Surinder, account The accounts as users clip. Insight growing average just for

Surinder Thind

or slower And but earlier -- conversion there when in in the should conversion of macro? the talk activity of strong, point? very having -- with pipeline when that kind How also was when activity, at made the it. and this change Obviously, just think we conversations Got there’s at kind this that conversion about terms so about more then the you can robust. decisions I talk -- was when the wasn’t point that and advisers about economy economy the less in you’re think flows, about it pipeline has forth? outlook of were any maybe if been you reflects Can

Bill Crager

and more to fourth tend, quarter more had the strong. they but we conversion you is those strong We’ll conversion have But And clearly a market very environment. tentative in the tend the third market know, lumpy. given was quarter, quarter be the activity Yes. Surinder,

of couple credit in we quarter planning We workplace a solutions capabilities, of financial last for our a and to services. leading for with national union UBS XXX(k) national a sign bunch worked did signed offering. This weeks, to offer their have fiduciary RIA our the and our we

to we we’re We’re focused and winning we’re out the -- want on winning. mandates

as business seen number I in today of the Wealth been think we’ve pretty have before, rate that not well the are company in it’s year. as win year, with business, higher the data rate had is firms this this the working but win than substantial only a and exceptional ever

The with despite believe, very been is we’ve on it. the see not can year It’s new been only we’ve been market. those focused And our services in very successful, focused much other new logos very or note you doing very, existing that opportunities. that I I thing clients, those and expanding would this on

You the considerably. that we’re can per adviser way pretty has is see of on in the of the an in accounts accounts is how using. platform up considerably. total the the AUM The many of broadened those number pretty it number services are represent numbers expanding accounts platform in The considerably. up adviser on And number services

issues. to I drive, see to performance-related able the existing are we’re things headwind So going are that focus underlying going aren’t on those The in those when you investment deeper the we to the think that and results And rates, KPIs flow we the we’re market we’re said on industry can performance-related focus, and go it, program, driving. our very encouraging. client base, overall is And of occurring.

Operator

Peter Our Davidson. is next from D.A. with question Heckmann

Peter Heckmann

far. so ton You information presented of a

follow-up of some your technology FNZ. and FNZ’s to wealth your markets ability the solutions Australia? core FNZ into with either limit market wealth on X partnership like Just U.K. Does or

Bill Crager

solutions, have We And be be wealth the global the and some our data things like be But of best-in-class some our shortest we work with execute a Ultimately, window global area think portal, more a includes world-class, partnership is things say, be I’d just market. fiduciary able starting really on -- partnership, it’s financial do client we’re believe designed as international I that will we’ve together the to in capabilities. on that focused well. Peter, or forge this which platform and about the software of broadly fin as to our we would market less the our right? apps planning to some would less to those is we for very opportunity for and powerful there’s have capability, of which regulatory get some solutions next -- software or are would a

Peter Heckmann

to But that of Okay. That’s run I so you’ve all aggregate of deals, could for them quarters? those I next completed suspect X for we about couple right. rate acquisitions give think them for All annualized And are none out just helpful. you maybe big. X then revenue date. an modeling can the think us

Bill Crager

Yes, Pete.

this in of QX, over those the little yes, total million. $X -- So was X, is a

what winning annualized early we’re -- I’d winning that is or But is the to some bat, add we’re in early in mandates. important that just some I’d about the off the Peter, So currently, $XX match million. here, really game say,

as we’re accelerating board. valuation their capability advisory something we that’s is company. in market. a in firms. core It would indication RediX wealth So embedded advisers the we and managers, the one-of-a-kind an XXXkplans.com, UBS Truelytics, of the well being asset how data which RIA highlighted going platform. And when for be acquired deeper with financial the In the The market as it’s growth is received is across and our in

Operator

Our Schmitt Blair. next Jeff question is from with William

Jeff Schmitt

wouldn’t on upsell It and end Or is, they? of be determine the A Or are? can Insights question into on they where have solutions. helps question guess, I that where opt But I why seems advisers guess do opportunities to you the more AI back run kind that that? sort of the determine Engine. do my to

Bill Crager

both it service. -- is use We this ways. valuable We very a

a of offering high, be I And sell bundled to important capture them and into it, marketing think, reach that tax our Wealth and benefit that and is high utilize because we or a an in internal heavily utilize we try creation as high can you direct bundling out and that very that our We actually there have, desktops closing account this revenue the part note we’re adviser compared unique service platform of that Data going their to XX% we in not our this, your has any potential it it’s sales focus are overlay can could we and of to other to to But value from then chance service say, an that. and like or have indexing. social space. solutions and data will that has value So bringing that to service.

the customized you. we’ve Here marketing tools are for that

go that a Let that are the us you where trying client. if sales know what from happens And typically this standpoint, this of through powerful say to let head a -- that you close very it. yours us with nail the and hitting without sell versus and is help people has help need features we’re benefits to go all client on adviser connection engaging opportunity, that

Jeff Schmitt

it. Got

the just the then -- I average guess, are and I uptake, the greatest seeing I guess, upward, impact fluct Okay. wondering on rate starting on I rate? And mean, that more importantly, what’s fee see That’s the to overall the that the personalized fee is which great. just and having most? biggest solutions driving

Bill Crager

allocation sorry, XX in together basis net fee that and gross and XX worth thing. of net and bundle positive, the I contributing very individuals portfolio highest our rate net rate, to Yes. be all the fee these But consulting, And high point in these script, of say when that for things high revenue both in seen year, tends But it of XX really talked business. it’s very we’re overlay, helping rate capabilities. that, is kind to the points it in the that some growth in -- basis there solutions in I close advisers execution worth, things offers we XXXX, XXX% range. XX, then net worth seen all high our we’ve this are we’ve being bundling from impactful index equal, would business. direct free the explicit about asset solution and And I’m

but market primary will be grow high we’ll there. worth, truly market, affluent solution driver. probably been that From it’s continue we’ve So net high, direct more index or to and a there smaller mass very a market successful target because the

Operator

Raymond is Patrick next James. O’Shaughnessy Our with question from

Patrick O’Shaughnessy

with So Engine per that end ones their your Insight deliver an insights XX it in which insights That’s is account. a delivering can do and clients? day. How million to about a you than X doesn’t bit determine more work on they actually adviser overwhelm way little per

Bill Crager

excited because business. we’ve investors built platform a that I’m to beyond built with a and this share the that advice adviser can platform. valuation the Patrick. to how the of grow analysts the client an have is best And adviser we their optimize extends with offering and

in the executing that is impact Data then ranking that Platform. the to by and we a service at insights or to protecting And that’s transaction what financial that adviser so create risk, of executing do they’ll that be adviser And then published based opportunity on we or the with and on forward. accounts that going accounts all on revenue powered Wealth really

it list insights implication not a published they bundled market. utilized and like have is -- a stack Wealth highly And of is impact. or particular We to adviser. these the of are data, ranked with grocery insight we highly one that kind the and by if understand so an then Data just making that’s that So then categorized can in it’s capability ability the that to are and way automate categorized, highly the Platform for They the they’re things. utilize they’re is that -- it of we

for to a today we’re and penetration tends quarter, to meaningful, the structured advisers advisers. the a And that environment begins growth very So and rolling the fourth that less meaningful platform in on. it we’re for the step that’s to the utilization here of be insights our introducing we’re And yet, a the business insight that us. capabilities seeing. driving listing of out becomes optimize the market powerful In

Patrick O’Shaughnessy

what’s speak it. quarter your be to that bit helpful. you revenue on quarter-over-quarter. there? then Got subscription little down That’s Can fourth And it will outlook, a implies going

Pete D’Arrigo

the analytics they fourth have had recognized think the in reset that some and we business And that our big who when their data clients minimums minimums. had in revenue, go quarter. thing usership we I above deep

big QX. was difference that think the I driving thing So in that

Operator

Goldman is Our next Bailey Sachs. question with Ryan from

Ryan Bailey

the newer sense to I less back who their once us advisers would you their be using wondering actually along help demographics Insights on any further if in again. to smaller, about it who’s the coming or like sophisticated, larger, or more careers of Just Insights, So the could was sort they careers? think Engine are of are using very helpful.

Bill Crager

Yes. institutions. bank seen adoption are of We’ve the accounts Ryan, looking at early broker-dealer transition adopters the have in space been lot higher banks larger to as a at services.

I do exact a of our be newer, believe market, will digital quite inclined And Data few Platform the I more as weeks offering, adopted that the demographic would would announced service, adviser. ago, bit highly adoption significant. for you into that this not probably there we’d which, that cloud anticipate in So pipeline the that is a we anticipate. see again, by the drive Wealth just we that

the But been bank adopters space. we’re early the primarily, broker-dealer it. enthusiastic have So in about

Ryan Bailey

it. Got

And value that this both you too it about a advisers might early seeing be sort in Okay. behavior or that and solutions? but some the maybe accounts of difference to the using Like they’re real these are way stay little of because with are for noticeable to deciding a just yet, Are think asset-based platform? is any not. clients Insights this solutions? of retention sort of difference Any and seeing in

Bill Crager

to is services are driving in rate right? personalized it’s because and very that to important Yes. can you is The And And very And overall underneath you’ll masses, individuals. Ryan if note, here has that have I very not industry the resilient. been the think you proposition these the redemption our value-added very, scrub that, down because a towards they’re They offerings addressing very see been And it’s matters. see and industry, the stickier there’s personalized. And hear that resilient. you numbers. that

and right? under also accounts. be individual that I client. that, what X see And resilient to me, it’s risk an it with the and life that of reporting cycle evolves that accounts, versus you the our very there static and doing that redemption is performance They’ll investment. profile when doing you bought you is for return mean, is for be here’s me it that that personalized, scrub long-term to everything evolve cycle, with more the mechanism ago, accounts think tend created data, And this, By how your continues too. years I This to evolve. I so they’re kind of these

that. real positioned in And scale. incredibly power deliver so Envestnet to there’s that at well is

quite we’ve despite there, the at I and been we our say, it it’s and investment at personalization call was we’ve tonight, on something difficult overall, a So the think bit scale been and in, of been it’s invested headwind. market, for very a And program that successful scale I know create call to everybody it. part and -- Ryan, I’d

but And position and TCS like FNZ a stated ecosystem advancing our we’re also our were we investments. to in the going we’re partnerships We’re forging areas ahead. driving with folks make growth We made investments, partners. environment, those difficult of with and we’ve in very

investment margin we now for we’re to strategy, and speaks and we’re So the really execute expansion, discipline I the XXXX. towards that organization around it think to focus, committing the which it turning put rebalancing

So I hope Ryan. that’s helpful,

Operator

to reached closing have turn end the for of back question-and-answer to We would conference over Bill our I the session. comments. like Crager

Bill Crager

our this Thank very the community and you evening. of joining so much for of and support all Always us investors. much appreciate analyst

speaking are Thank of to you, in ago, shortly to the to have and said all we we’re partners Envestnet, a next we quarter. Envestnet very very forging and and our forward -- ahead, I seeing difference you executing. making. the look evening. that just again I’m thankful for thankful for Ryan ecosystem you moment I good people As are I’m for and a all the

Operator

conference. today’s conclude does This

your lines disconnect participation. time, you thank for may and You your at this

Envestnet (ENV) 12 Nov 222022 Q3 Earnings call transcript