The Client
Interest in robo-advice has grown quickly over the last few years. An increasing number of platforms and investment advisers are coming to market with robo-products, offering clients affordable and simple-to-use advice around portfolio construction. These robo-advisers will typically provide investors with exposure towards index funds and various exchange traded funds (ETFs). Pritle, an online wealth platform, is a leading example of this growing breed of robo-advisers.
Established in 2014, Pritle aims to deliver cost-effective, online consumer wealth management services. In 2015, Pritle acquired Fundix, a fund supermarket and online wealth manager. As part of the consolidation, Pritle has been bolstering its client interface station and integrating the technology systems of both organisations. Pritle is a fast expanding company, having grown its client base substantially in the Netherlands. It is now looking to distribute further afield into other EU jurisdictions either by setting up offices or through acquisition. As such, it needs to work with the best service providers in order to realise this success.
Why Calastone?
The decision to use Calastone was strategic, acknowledges Thomas Bunnik, founder and Chief Executive Officer at Pritle. While Calastone provided a degree of Order Routing for the acquiree company, a significant portion of trades were coming via brokers and even manually through fax. Rationalising this process by utilising the efficient and seamless trade Order Routing service provided by Calastone made economic and operational sense. “We wanted to deal directly with the transfer agents,” explains Bunnik. Calastone was obviously the natural fit to make this possible, having undertaken a number of similar projects for a diverse array of clients.
By connecting to the Calastone network, Pritle immediately benefitted from straight-through-processing (STP), which enables operational efficiency and negates the risk and potential for errors associated with manual processes. Calastone enables fund platforms and distributors to route and place orders to the relevant counterparties in any messaging or protocol standard. “Calastone is a fantastic bridge between the fund house and transfer agent,” comments Bunnik.
Bunnik highlights the decision to trade completely through Calastone was driven by Pritle’s desire to have better and more consistent execution. It was also a more cost-effective approach and represented best value for money for end consumers. Robo-advisers reduce the cost of wealth management to consumers and appeal to tech-savvy clients that want easy to access services. Working in conjunction with Calastone to streamline Order Routing and execution helped enable this.
Implementation and Going Forward
Integrating Calastone onto Pritle’s existing infrastructure was straightforward. The process was made smoother by the high-quality client relationship management offered by Calastone and the company’s ability to tailor solutions accordingly to clients’ needs.
Since going live with Calastone, Pritle has noticed a number of benefits beyond operational streamlining and cost reductions. “The renewed efficiency has made it easier for us disaggregate trades as required under the Markets in Financial Instruments Directive II (MiFID II). By acting as a bridge between the transfer agent and Pritle’s back-end, Calastone has enabled disaggregation to be carried out seamlessly without the burden of legacy technologies, which is prevalent in a number of other service offerings,” says Bunnik.
The most important long-term goal for Pritle is to grow its assets and geographical reach, adds Bunnik. Calastone provides interoperability supporting more than 180 different message formats and global coverage providing 8,500 trading links in 27 countries. This scalability and enhanced automation makes Calastone exceptionally well-placed to suit Pritle’s ambitious growth plans.
“We want to be able to operate in multiple countries and on-board more managers as demand for the service increases. Through collaboration with Calastone, we believe we will be able to achieve those goals,” says Bunnik.
