The Future of Advisory Services: How Technology is Changing the Way We Invest with Ainslie Simmonds

Jack Sharry: Everyone, thanks for joining us on this edition of WealthTech on Deck. Each week I have the privilege of speaking with industry leaders around issues that informed advanced financial advice, Wealth Management, retirement technology, and talk to those who are leading the way as we seek to help advisors, clients, participants and firms enjoy better financial outcomes all around the confluence of digital and human advice. A vital trend that has been underway for some time is just about every leading firm in our industry is building what I call comprehensive advice platforms. This is where data financial planning proposals portfolio management, investment and annuity products risk and tax management, rebalancing transitions and income generation come together to help advisors help clients maximize the growth of their assets and of the withdrawals they take from multiple accounts and income sources. Today we will speak to a recent and powerful entrant in this rapidly evolving space. Ainslie Simmonds is the president of Pershing X, I find her story in the Pershing X story fascinating. Not only what she and her team are building now, but how she got here. Ainslie, welcome to WealthTech on Deck.

Ainslie Simmonds: Thanks. Thanks for having me. Really excited.

Jack Sharry: Yeah, that’d be fun. So easy. Let’s start with you telling the audience about Pershing X, you got a great story. What are you guys up to?

Ainslie Simmonds: Yeah, so Pershing X is an advisory platform, we’re going to build it so that it is open for third parties. But then of course purging will have our own purging acts, pardon me, we’ll have our own version of our apps, many of which you just rattled off. But what we’re really focused on and where we see the whitespace in the market is around interoperability. So that apps connect to apps so that when you enter something in one app, it carries through to the others in a really logical way. And you know, it’s essentially a productivity problem, you know, what we see in the market is that advisors only spending 20 25% of their time with clients and 75% in desk work. And we just see the massive opportunity to flip the switch to go the other direction 75% of the time with clients 25% in desk work and technologies mature enough to do it, you just need to have a pretty big ambition and backing of a large bank.

Jack Sharry: Oh, it takes capital, I get it.

Ainslie Simmonds: It does. It takes capital. And it takes, you know, frankly, a pretty complex simultaneous build, right, you have to build out all the apps and in concert with the platform and the data structure behind it. So you know, what’s really exciting and why I joined this particular place to pull this off is so much of that already exists, that could be leveraged around the bank and purging and it’s about taking that sort of running start and running faster and further. So that’s what we’re building. That’s what we’re focused on laser focused.

Jack Sharry: So why don’t you give a little bit on the backstory. I know it but I know our audience would love to hear it about Bank of New York, I’m going to step back a little bit further because you have a track record of innovation going way back to learn best and probably before that, maybe why don’t we start with your backstory, then we’ll talk about the bank and then we’ll talk about how that fits into Pershing. How that creates Pershing X. And maybe if you could give us that arc of your story that would be great.

Ainslie Simmonds: Sure, the long and crazy story. So I actually started my career in consumer products, who was Molson Campbell’s Soup Company. And what I took away from that is, you know, what it means to build trusted sort of consumer grade product and everything that goes into that and all of the sort of data and thinking and strategy that you need to really pull off a great consumer product. The internet happened in the 2000s. And I had an opportunity to jump in to what was a very small-scale startup at the time, it was kind of an interesting company called invest tools, which then grew into and merged with another company called Thinkorswim, which was my first foray into fintech. It was a options trading platform, brokerage, but a really sweet product. And we put together this sort of education arm with this trading arm and really built this powerhouse product called Thinkorswim. That got sold to TD Ameritrade, that was my first exit. I was the head of product and marketing at that firm. And I got the bug, you know, I got the bug for data driven decision making. I got the bug for iterative delivery, I got the bug for really building great software and how that could really open all these doors to a really great business, building a great business. And then you know, when TD roll that the green carpet in Thinkorswim still lives on that platform today, interestingly enough, yeah, it still is rocks on I moved to another even earlier stage startup in FinTech called LearnVest and this was pre FinTech being called fintech. This is early days in venture backed growth in this industry. Actually, my old boss from Thinkorswim introduced me to the founder of learning Austin said, you know, Ainslie, I think you need to meet this person because you guys share kind of this mission to help Americans with their money. He knew that just about me kind of personally. And so I joined LearnVest as an employee nine or 10. And grew that over four years into an exit with Northwestern Mutual. So they bought learn fast is kind of the core of the planning engine that they wanted to build out for their, you know, 6000 person. Advisory force.

Jack Sharry: Gotcha. And from there, I know you went on to join Ultra stand at Northwestern Mutual. Join PIMCO.

Ainslie Simmonds: Yeah. And everyone was like, wait, what, like, what are you doing? But it was such a interesting moment for PIMCO. So Pimco, $2 trillion, asset manager, primarily in the fixed income space, had sort of built decades of excellence around asset management, but really hadn’t built any excellence around any sort of digital engagement, digital, anything. And so the CEO of Pimco, and sort of the head of the retail business, met with them, and they said, actually listen, like, you know, blank sheet of paper, you get to come in, and you get to decide you get to build the team, you get to figure out what the strategy is, you got to, you know, help us figure this whole thing out. And I love me a good build. So I was like, Well, that sounds really fun. You know, that sounds really interesting, because, you know, most companies were a little bit more mature and had started down paths and sort of, you know, had made decisions. And I was like, a blank sheet of paper. And that sounds fun. And it was, it was a great ride. And we put out five different products, a couple one industry awards, you know, I still stay very close with the PIMCO folks, they say it’s transformational in the selling journey, and everything that they’re doing. They’re having a great couple of years. And I was like, Well, that was really fun. And, you know, I probably still would have been there if I didn’t get this phone call. And you know, what I would describe this, as is the same sort of blank sheet of paper, I saw him go like, on steroids, with just this amazing, amazing opportunity to build something that I personally have felt is an unmet need in the market. And I personally believe could be, you know, just so industry transformational that I just couldn’t help myself. So I said, yes.

Jack Sharry: So tell our audience about the role that Bank of New York plays the role that purging plays, we’re PershingX fits, because I know there’s some Well, you tell the story.

Ainslie Simmonds: Yeah. So the Bank of New York Mellon, like every good institution, you know, does thorough and frequent reviews, the strategic opportunity, and it’s a very big firm, it does a lot of things. But what they really saw was this, as most I’m sure listeners to your podcast would quickly identify is this current and accelerating trend around the business of wealth management, moving from broker to advised more money coming into the sector with the wealth transfer that’s happening? Just a lot of really great secular trends in wealth, right. And so when you see sort of long, sustained secular trends, you have to look at it. And so the bank took a good hard look and said, Listen, there’s a real opportunity for us. If we do it, right, right, like there’s no opportunity for me to product. But if we do it, right, there’s a real opportunity for us to come in as a trusted financial institution, with the relationships that we have across all our businesses, investment management, wealth management, asset servicing, digital assets, custody, clearing, like you name it, across the entire firm, there’s an opportunity to build something special for advisory. And so they were really purposeful Robin Vince, who was the vice chair at the time, who’s just been named the CEO of the bank, came from Goldman and sort of saw the power and also just very purposefully thought about the power of sort of setting it up as separate, yet connected, right. So Goldman did that with Marcus and, you know, it was a very successful model. And he said, you know, to give the team the agility and the freedom to really innovate. We want it to be set up separately, but this just can’t be a tinkering lab. Like this can’t just be like a pet project where you play foosball and nothing ever gets done. This needs to be connected to the business. And it needs to be every day sort of talking to clients. You know, hearing the marketplace needs being really connected. So I think in really a stroke of brilliance, set it up. As you know, Pershing X is a bank in New York Mellon company, but it is connected to purging because Pershing x will be multi custodial and purging will be one of our custodians. So knowing that custody business what’s inside the power of it, what it can do, what it can’t do, was a really important decision. And so I do sit on the purging executive team him. And I sort of split my time between our sort of bank headquarters at 240, Greenwich and out here in Jersey City, because I sort of connecting across all those executive teams. But it was really purposeful. And I think a really powerful structural setup to be honest.

Jack Sharry: Well, that’s what caught my attention, as we’ve talked about before. To put that kind of little strategic thought in clearly, there’s a good deal of thought that went into this, but capital behind it, access existing capabilities and, and elements and contributing capabilities, I should say, that all said, now you have to put it all together, including stuff that is not already on the purging platform or at the bank in New York. This is an exercise in connecting dots, as you know, talking about the dots, you’re going to connect, what does this look like? Not item by item, but what is this advisory platform? Because I know you have big dreams. And it sounds to me, like you’re on the right track to fulfill them.

Ainslie Simmonds: Yeah. So you know, listen, we’re just being very customer led like any other sort of great firm, but you know, where I look for inspiration is out of the category. Because you know, what I said is, this is a productivity problem, advisors are spending 20% of their time with clients, we want to flip it, it should be 80% of their time with clients. So then you say, Who’s solved workplace productivity or productivity in general, or sort of, and, you know, I look at the big three tech companies, in my mind, the Google Suite has solved the productivity problem or is on the path, you know, no one’s ever done, but on the path to solve the productivity problem for non-enterprise. Microsoft is taking the enterprise productivity suite game head on, and Apple solved the productivity problem for entertainment. Right? And so you say, okay, like, how did they do that? Like, what are they doing, that we could learn from and model off of, and what they’ve done. And this is, like, you know, there’s no new ideas, there’s just great ideas brought to new categories, is what they’ve done is they’ve said, Okay, what are the apps that people need? And then how do I make those apps work really well together? So how does iTunes work with, you know, the, you know, App Store, how does it like, and they find these magical, interoperable moments where like, for example, your apple, Id gets you into everything, you know, it’s really easy. And then it tracks everything, and it knows everything it knows too much, almost. But I’m sure you know, and Microsoft, like, they found this magical moment where if you’re using teams and Outlook, the calendar syncs, and you don’t even notice, you’re like, oh, yeah, I updated on Team surgeon, I have to now look, I don’t even know, it doesn’t matter, because they just talk to each other. Or, like, when you get a team’s meeting out of your outlook, it just pulls a chat in with all the people that are on the invite. And then you can just start chatting in the team like these magical interoperability moments where you don’t even notice you’re just traversing your day you’re doing your thing, you’re getting your work done. And you don’t even notice they shave four minutes, three minutes, seven minutes off of this thing that you used to do. When you do notice it is when you have to then go interrupt with a something that isn’t on the platform. So then you’re like, what a copy, paste, upload, download, what am I doing. And so I think these big tech companies with all their might, and all their, you know, capital are staring down this productivity problem and chipping away at it and call it magic moment by magic moment and finding those places where labor is wasted. Time is wasted. People are frustrated, it’s exhausting. And so you know, I look to those firms, and they say, they’ve just done it on a bigger scale, we get to do this on a more manageable scale. You know, what 200,000 Through 250, I don’t even know what the latest number is advisors in the US, we get to do it on a more manageable scale. But the jobs the same, we got to shave the minutes, the moments, we got to make it delightful, we have to just, you know, I was demoing a potential feature of purging extra my advisory board, I have an advisory board of current and prospective clients. And I showed them this one thing about how something could go from here to there. And they were like, wait, what you could do that. And I was like, yeah, we can do that. They were like, oh my god, like I can’t even imagine how much time that would save for me and advisor and for my staff. You know, because most of these advisory businesses, they’re running it as a business and the more the hamsters they have to put behind the tag not the people or hamsters. But you know what I mean? They have to pay for that. And like, why can’t I solve that problem for them? It is absolutely solvable. It’s been solved on a broader scale. We just have to shrink it to our industry.

Jack Sharry: Well, one of the things have to have to highlight is that our industry tends not to look at other industries. It tends to contemplate its navel haven’t been around this industry a while and in you didn’t kudos to you for looking at Google Apple, Microsoft just to name a few leading firms that figured some things out that kind of changed her have rocked our world for continued to So kudos to you. And as you’re putting this together. That just reminds me how hard it is because we deal with this stuff all the then with our clients, is that interoperability? Sounds great. It’s really hard to do, because the systems weren’t designed to be interoperable, if you know what I’m saying. So talk a little bit about that. How are you? How are you going after that?

Ainslie Simmonds: Yeah, we’re gonna solve it at two levels, we’re going to what I call x to x, so our apps to our apps that we’re, you know, building from scratch, we get to set that up, right, we get to make those magic moments, we get to decide, I’m super excited about that. But I’m also excited because I’m a realist, when it comes to how we’re going to win in this space, we’re not going to win all the apps from any advisor, day one, no matter what they just won’t, nobody’s gonna like hand over their business to us, they’re gonna want to test it, try it, prove it see the value. And I would do so like, no question in my mind, to think that an all in one would get sold as like one fell swoop not a chance in heaven. And in fact, many advisors will never give us you know, app, three, six, and four, like, they love the apps they’re on and they are integrated in their business. And they work really well for them. And I say amen. Right, like, God love it. Like, that’s great. So what we need to do is create the extra x interoperability which we control, and then the right framework and platform for really great third party access to third party integrations, because we want to provide the value. That is our mission is to flip the switch on productivity. So we want to provide value, we’re just going to do the best we can on third parties, knowing that there’s different levels of maturity certain have like really great API, you know, endpoints certain don’t, and we’re just going to do the best we can, what I would say is we have a lot of experience as a custodian doing those third party integrations today. So there’s been a lot of road walked there. And we can leverage a lot of the learning that have all of the third party integrations that we’ve done on purging proper today. And so that’s kind of an exciting, again, like hit the ground running kind of moment, where if you haven’t been integrating stuff for the last 15 years, like you might be a little less mature and knowing what you would want out of your third parties to be able to deliver that value.

Jack Sharry: So this is very exciting. So glad you’re doing this. I’m saying our industry may have seen the Edward Jones announcements recently where they’re just going to spending a billion dollars on what you’re describing them. That’s essentially what they’re after. And there are many more JP Morgan spending all sorts of money, Morgan Stanley, all these big dogs, Orion investments as they’re doing it. So there’s a bunch of people talking about this stuff, right? I call it comprehensive vice platforms. What does this look like down the road? In other words, for Pershing x, if I’m an advisor, what does it look like? There’s all this stuff coordinates.

Ainslie Simmonds: So listen, you know, the other great thing about the Bank of New York Mellon is as the oldest financial institution in America, it’s patient capital, you know what I mean? The firm is very committed to this top of the house, there’s not a day that I don’t feel that commitment. And that shows up in a lot of different ways. People connecting me to people, people, referring me people, checking in people making sure I have what I need. Like, it’s so wonderful to be at a firm where the executive leadership team has just made a decision and is just really, really committed long term commitment. So what I would say is, this will evolve my hope is that we get a bunch of clients trying some of the apps and seeing the value of interrup. And then we just prove our mettle every day and that’s the what Microsoft has to do. They’ll make get in with teams or Outlook or both. And then they got to get you into office 365 You know, this isn’t a hard sell like this isn’t like oh my god, we’re you know, selling Ginsu knives here, this is demonstration of value, right? Like, I need you to see the value of moving your email to Outlook because it interrupts with all these other things. I need you to see the value. And as I said, no expectation we’re going to win every app 00 expectation, we’re going to win every app. It’s on us, though, to always be adding more and more and more and more of that interoperability value. I had a client say to me, Ainsley, listen, I run. It’s a aggregation type firm. You know, he’s buying a bunch of firms growing like stank amazing client. They’re like, at the end of the day, I don’t want to be a CTO. That’s not what I want to be. This is so exhausting to like, keep up, stay up, have it all have the he’s like, I would delightfully outsource all of this to you guys. But it has to be great. And I’m like, sure. Yeah, absolutely. totally hear you. It’s gonna take time. You know, I don’t know how long Microsoft’s been at this game. But they’ve been going enterprise by enterprise and, you know, making big decisions. Like when they made the move to cloud, big decision. They had to leave a big part of the legacy business behind but they saw the opportunity to take the suite further by making it all cloud based like we get to make those kinds, of course will be cloud native start the bad example. But we get to make those kinds of big decisions because this is a really patient thoughtful place.

Jack Sharry: Wow, the content of what you’re saying the words are inspiring, but your enthusiasm is even more.

Ainslie Simmonds: So, I’ve been told I’m a high energy. So yeah.

Jack Sharry: I agree in a good way. I think that’s wonderful. That’s fabulous. I can just you could use some high energy, because the thing that strikes me I love your comments on this. Here we are with a record number of people retiring every single day, and our industry is ill prepare.

Ainslie Simmonds: Ill prepared, it’s failing, come on, let’s call it Yeah, totally, totally. Everyone wants to accumulate, nobody wants to decumulate. Because they feel like there’s not a role for them. And I’ve done a lot of work at this at Pimco, it was a really fun product that we built. And I just think that is such myopic, short term thinking, because if you are a trusted advisor, you need to be a trusted adviser the whole way through. And if you’re managing the decumulation, portfolio correctly, you’re holding part of it for growth, and you’re managing certainty for a period of time. And, you know, everyone’s wringing their hands about intergenerational wealth transfer and all that other stuff. If you’re trusted, and you’re really ingrained, and you’re providing great advice, why wouldn’t the family stick with you, it doesn’t make any sense that people would peel off and set up a new relationship. So I just think like, there’s a lot of short term thinking in what is just a really amazing opportunity to be a really trusted advisor. I’m not saying everyone is short term thinking, please don’t take that I’m saying you said as an industry, so I’m just written with that as an industry. But you know, the advisor I trust is the advisor that is going to help me through my retirement and my decumulation, because that’s the most that’s the biggest financial decision I’m making ever every single day. On the ATM, anti human side, by the way.

Jack Sharry: Yeah. And they’re retiring earlier, they’re living longer. We through the threat of inflation is going to cruelest tax, I mean, this, you had all those things.

Ainslie Simmonds:  I read this, really great. I can’t remember what book it was, I gotta go back and think about it. But I read this history of social security. Amazing. So set up post World War Two, to bridge the gap between when people stopped working at 62. And when they died at 65. Three years had to cover three years. And obviously, that’s not the same game today. So you know, I just think it’s so fascinating how we’re just not doing enough. And again, you know, with a platform like Pershing X, I just think there’s so many incredible things. If you think about all the ways interoperability could show up, you know, it can very much show up in retirement paychecks it can, she can show up in a lot of different ways that no single point provider could do. No single point provider can manage that cache for girls, no single point provider can access, you know, the banking capabilities, the bank has no single point provider can you know, access the data? You know, just, you know, you asked me why I’m seriously excited. I’m seriously. I totally see like, I can see, I can see it, I can see the problems getting solved. With a suite that talks to each other.

Jack Sharry: I can imagine that. Imagine that. It’s crazy. So our time goes short, to half an hour. This has been a blast, Ainslie three quick takeaways from our discussion today to leave with our audience.

Ainslie Simmonds: Oh, takeaways. So I think one is, if you are in the advisory business, I think you need to think hard about how much you want to invest in tech and how much you’re going to turn to partners for. And I think that has to be a really thoughtful decision. And I think, you know, you can ask your partners and should ask them to expect more, I would say expect more, I hope people expect a lot out of us, I really do. And I would expect them expect more out of all their other partners and third parties. The second thing I would take away is that there is this massive opportunity to serve his clients through all stages of their life. And you need to think about how your platforms and technologies are supporting you in that, because you can’t hit these brick walls, right? Like you can’t hit a brick wall where you’re planning only does a human do can’t do him. You can’t hit a brick wall where your portfolio doesn’t have the ability to do the right tax location so that you have really tax advantage decumulation. Like you can’t hit these brick walls. It’s not okay anymore. And then the third thing I think is the point you made, which is like let’s get out of the navel gazing and look at our big broad world and say, how do we create experiences? How do we create apps? How do we create technology that people love? Not that they just tolerate that they freaking love and that can go from how you show up as an advisor to the tech you use to you know how you engage with people and what you say to them. Nobody wants doll. Nobody wants boring, and we keep showing up that way boring and dull and nobody wants that not. So those would be the three.

Jack Sharry: That’s great. That’s great. I really enjoy By this, I’d like to keep going, but we’ll stick to time. And as we do each week on our podcasts, we bring our session to a close. Could you tell us something you do outside of work that’s interesting, unique, something you’re passionate about?

Ainslie Simmonds: Yeah. So I’m super passionate about sustainability. And that’s going to be my next hustle after this one. And so I co founded the company with my husband trying to digitize recycling. So it’s a side hustle that I got going on, but it’s like one startup isn’t enough. I had to do another one.

Jack Sharry: That’s great. That’s terrific. So easy. This has been an absolute blast and to our audience. If you’ve enjoyed our podcast, please rate review subscribe, Pandora share what we’re doing here on WealthTech on Deck. We are available wherever you get your podcast. Ainslie, thanks so much. This is real pleasure. I can’t wait for the next conversation.

Ainslie Simmonds: Jack, thanks for inviting me. Take care.