Registered investment adviser (RIA) firms of all sizes face the challenge of finding a document storage solution which aligns with their budgets and meets their specific business needs. As RIA consultants, we understand this task can be daunting, particularly as advisers expand the size of their firms and headcount increases. Document accumulation is a natural product of firm growth, so it is important to establish an efficient and scalable storage system early on. Fortunately, the market for cloud-based document storage solutions has expanded dramatically over the last decade. In this blog post, we explore our 2022 RIA survey results in response to document storage software systems.
It has become commonplace for teams to work remotely and across multiple offices. Cloud-based document storage solutions can help RIA firms meet regulatory compliance requirements, reduce hardware costs, streamline operations, and improve the client experience in these evolving business settings.
Starting at around $10 to $20 per user per month, advisers benefit from secure cloud storage of client files and firm documents, making document storage software a compelling return on investment to all investment advisory firms.
It’s also important to understand the common misconception between document storage and archiving. Document storage systems generally serve as the client file and general file storage systems for RIA firms. On the other hand, archiving solutions such as the MyRIACompliance Archiving and Review Platform are generally more focused on organized, long-term storage of client communications and advertising materials sent via email, posted on social media, displayed on a website and more. Data storage and archiving technology systems while separate, are essential RIA firm systems.
Document Storage Systems Adoption Year Over Year
RIA Adoption Rate of Document Storage Systems
In the past four years, the adoption rate of document storage software by RIA firms has remained constant. Like other core technology solutions, larger firms are much more likely to adopt a document storage solution compared to emerging firms. We continue to recommend investment advisers use more secure, paid versions of cloud storage solutions, when possible, given the security features, operational efficiency and robust backup capabilities.
RIA Document Storage Systems Adoption by Firm AUM Size
The Top RIA Document Storage Systems
In the past, Box and Dropbox have dominated the RIA cloud document storage space, but Microsoft has recently emerged as the industry leader with its cloud-based Microsoft 365 document storage capability.There are also a few financial advisor-focused document storage solutions, such as Redtail and Docupace, which have continued to gain increased adoption, while the use of Sharefile has dropped 4% in the past two years.
Both Box and Dropbox offer free consumer-focused versions for general storage solutions, but are not specifically designed for the investment adviser or broader financial services industry. Advisors need to be selective about which solution best meets their firm’s needs, as the task of changing document storage providers is typically cumbersome. We recommend RIA firms strongly consider document storage solutions with features designed to meet relevant regulatory requirements.
Firms utilizing our MyRIACompliance software platform benefit from our integration with Docupace, a digital document management system which uses government-grade encryption to maintain security. The integration also allows joint Docupace and MyRIACompliance® subscribers to leverage single sign-on to assess the Docupace Vault and consolidate their physical and digital records.
This blog post is the last in the series of our analyses on technology adoption and usage from the findings of our annual survey of more than 2,000 RIA firms. This proprietary RIA in a Box study was conducted in the first quarter of 2022 and is paired with results from past surveys, as well as publicly accessible data provided by the Securities and Exchange Commission (SEC). The goal of our annual study is to understand different options which comprise each firm’s characteristics, and to determine whether specific characteristics impact the growth, size or operational efficiency of an RIA firm. Our previous posts include discussions on findings on financial planning software, portfolio management styles, portfolio management systems, CRM providers, and risk tolerance software.