How do you build a platform for growth?

With around £1 trillion managed by UK advisers on behalf of their clients, most of these assets are held on platforms. But in recent years, a combination of technological advances, adviser demand for better integrated systems, and a growing cohort of scale advice firms emerging from a period of significant market consolidation has seen the role and requirements of platforms shift.

As the platform landscape continues to evolve, so does the role that platforms play in meeting the needs of the business, their advisers, and their clients. This heightens the importance of firms’ choice of platform model aligning not only with their current needs but also with where the firm is heading. Whether they remain independent, join a consolidator, or move towards a more integrated model, platform strategy plays a critical role in defining the business’s efficiency, profitability, and client experience. The process is further complicated by costs, with advice firms laser-focused not only on their advice fees, but on the total cost borne by consumers.

To aid firms’ assessment process, Embark, in conjunction with NextWealth, worked with a number of advisers to get insights into what the key drivers are when building a platform strategy. These considerations include the changing needs of clients, managing the regulatory environment, and finding partners with the capability to evolve the technology

Ultimately the right platform choice should help advisers focus on what matters most: giving good advice.

While certain business types may gravitate toward specific platform models, there’s no one-size-fits-all approach. The variety of options, from third-party platforms to fully customised solutions, demands a more strategic approach, ensuring alignment with a firm’s operational needs, client proposition, and long-term business goals. A logical and robust platform strategy is key.

There are seven simple steps that firms can take in order to clarify their thinking, and then develop a platform strategy properly tailored to the needs of the business and their clients:

1. Defining business vision and priorities
2. Understand the businesses culture and find a partner that fits
3. Consider clients’ need: now and in the future
4. Get specific on operational problems
5. Agree due diligence to evaluate potential partners
6. Build a business case
7. Plan resources

With that process complete, firms can more confidently take an informed and objective look at the range of options and move forward from there.

Choosing the right platform model is a complex decision, shaped by multiple factors unique to your business. While every firm will have its own priorities, certain key considerations stand out for each approach.

• A third party platform: A proven, efficient, and low-risk solution, allowing them to focus on their core business of financial planning while benefiting from well-supported infrastructure and established service models.
• A branded portal (e.g. ‘Platform Operator’): A branded portal experience to your clients to improve the continuity of the client experience and reinforce your identity throughout that experience.
• A white labelled platform (e.g.Cosmetic White-Label): Offers branding and some control without full operational risk; ensure this balance aligns with firm goals.

For larger firms who are able to absorb the set-up costs, meet the ongoing resourcing requirements, and hold the additional funds for capital adequacy, full platform ownership i.e. an adviser-as-platform may be feasible.

Each option does require trade-offs. Greater simplicity, while reducing training needs and offering less cumbersome administration may mean that the chosen platform is less able to cater for those more complex cases. Where a platform may be able to support pioneering innovation and custom-built tools, it may also require greater resources, expertise, and ongoing updates to keep pace with market trends.

So where a Platform Operator model might not necessarily be the right fit, a firm may prefer to go down the route of a Cosmetic White-Label with some back office integration and allowing regulatory and operational responsibilities to remain with the platform provider. Alternatively, a firm might seek the ease of a ‘plug and play’ Platform as a Service (not Model B where partners need permissions, a simple lower risk WL).

Fundamentally, any change must deliver clear benefits for clients, especially given the administrative burden and potential disruption involved in transitioning to a new platform. But crucially, in such a competitive market, cost is also key. So even once a firm is clear-eyed on what it needs the platform to deliver, the cost consideration will undoubtedly shape any final decision.

The price of delivering and receiving financial advice remains intensely scrutinised, particularly in the context of meeting the Consumer Duty requirements to ensure ‘fair value’. Advice firms must consider not only their advice fees, but the total cost borne by customers. At the same time, advisers are having to grapple with rising operational expenses driven by heightened regulatory compliance and the inflationary environment, putting pressure on their margins.

A key contributing factor to the increasing cost of delivering advice is the use of multiple systems with different processes, combined with the challenges of reconciling data from multiple sources. As such, taking a strategic approach to offer a streamlined long-term platform plan will create long-term value.

The right platform choice can be transformative. Choosing the right platform model is no longer a straightforward decision. No single model is a silver bullet, and even the most well-structured platform strategy will likely require some creative problem-solving to bridge gaps in functionality, data access, and compliance. And any platform transition requires more than a simple ‘lift and shift’ of client assets—it demands a reassessment of processes, integrations, and efficiencies.

Whether a firms’ strategy involves deepening existing partnerships, re-engineering its approach, or exploring a more integrated platform model, those that are most successful will be those firms that move forward with intent – leveraging data, expertise, and a clear understanding of their core purpose.

With its deep understanding of the market, Embark offers cutting-edge platform technology solutions powered by technology in partnership with FNZ, including all the building blocks and tools required to evolve and scale your wealth propositions while enhancing the client experience. Its commercial proposition, with value-based pricing to underlying customers – protecting margins over the long term, combined with secure ownership under Lloyds Banking Group (LBG), ensures investment to develop the platform to match the needs of clients now and in the future. Furthermore, the platform options and expert support team also allow firms to significantly ease the regulatory burden and associated costs.

Ultimately, the right platform decision is one that enables firms and their advisers to focus on what matters most: delivering high-quality financial advice for clients while maintaining operational resilience and regulatory compliance.