AdvicePay Inc., the first compliant payment processing solution built specifically for financial advisors to facilitate fee-for-service financial planning billing, closed its seed round of funding today with $500k led by Goodworks Ventures and Front Street Capital, both based in Missoula, Mont. The remainder, and majority, of the round’s funding came from fellow financial advisors who believe AdvicePay will power the future of the fee-for-service financial planning business model.
Co-founded by financial planning entrepreneurs and industry influencers Alan Moore and Michael Kitces, AdvicePay gives advisors the ability to bill and collect financial planning fees directly from a client’s credit card, or bank account via Automated Clearinghouse (ACH). To ensure compliance with RIA custody regulations and avoid triggering custody audit requirements, AdvicePay also provides a portal for clients to directly enter and manage their payment information, review invoices and payments, and confirm any billing changes, while limiting advisors’ access to private payment information.
“As investment and insurance products become commoditized, financial advisors must increasingly deliver real, holistic financial planning advice that demonstrates their value and sets them apart in an increasingly competitive marketplace,” said co-founder Michael Kitces. “However, up until now, the fee-for-service business model has required clients to write paper checks, which may be fine for a standalone engagement, but is extremely inefficient for advisors building an entire fee-for-service financial planning business with recurring retainer fees.”
AdvicePay was initially seeded by XY Planning Network (XYPN) co-founders Moore and Kitces, who built the first iteration of the payment processing platform in 2016 to help XYPN’s more-than-500 financial advisors charge monthly retainer fees without triggering custody as an independent RIA.
This latest round of capital will be deployed to build out AdvicePay’s development and customer support teams and enable the company to expand the payment processing solution to all financial advisors beyond just XYPN members.
“We view AdvicePay as the final piece of the puzzle for all advisors looking to serve clients that don’t yet have large asset accounts,” said co-founder and CEO Alan Moore. “It’s essential for financial advisors serving next generation clients to have an efficient way of billing clients, especially on a recurring basis, when many don’t have investment accounts and will be paying financial planning fees from their income instead.”
AdvicePay is currently in live-beta mode, with over 250 active users already on the platform processing financial planning fees, and is in the process of onboarding additional financial advisors from a waiting list.
Yves-Marc Courtines, partner at BCM LLC, will join the Board of Directors to provide insight from his 20 years of industry experience, particularly in the realm of investment banking and M&A.
To learn more or schedule a demo, visit www.advicepay.com.
AdvicePay is the first and only payment processing platform built for specifically for financial advisors. We aim to make financial planning services available to consumers without high investment balances by building a compliant payment solution to process financial planning fees. To learn more or schedule a demo, visit www.advicepay.com.
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