The findings in this blog post come from RIA in a Box’s annual survey of approximately 1,500 registered investment adviser (RIA) firms, which was conducted in the first quarter of 2023.
In our last blog post, we talked about the top RIA portfolio management styles RIA firms prefer. This time, we’ll be delving into the top document storage solutions that RIA firms prefer.
At what rate are RIA firms adopting document storage solutions year-over-year?
In the past four years, the adoption rate of document storage software by RIA firms has remained relatively constant, with only a 2% decrease from 2021 to 2022.
RIA firms, regardless of their size, encounter the difficulty of locating a document storage option that is both affordable and tailored to their unique business requirements. At RIA in a Box, we recognize that this can be an overwhelming endeavor, especially when firms experience growth and an increase in staff members. Naturally, as your firm grows, so does the number of documents your firm keeps. Therefore, it’s important to establish an efficient and adaptable storage system from the outset.
At what rate are RIA firms adopting document storage solutions by AUM?
Compared to emerging firms, larger companies have a higher probability of embracing a document storage solution. Given the current and escalating risks to data security, our recommendation remains that investment advisers should use secure, paid editions of cloud storage solutions, whenever feasible. This is because these solutions typically have notable security features, operational efficiency and strong backup capabilities that other solutions don’t.
What document storage solutions are RIA firms using?
In previous years, Box and Dropbox were the dominant players in the cloud document storage market for RIAs. However, Microsoft has recently emerged as the leading industry provider with its cloud-based Microsoft 365 document storage capability. While there are a few document storage solutions tailored specifically for financial advisers, such as Docupace, our data shows they are not the predominant option firms are using for document storage needs.
Although Box and Dropbox offer free versions of their general storage solutions, they are not specifically designed to cater to the needs of investment advisers or the broader financial services industry. Advisers must carefully consider which solution aligns best with their firm’s requirements, not only for cost-benefit reasons but because switching document storage providers can be a burdensome task. It is highly recommended that RIA firms prioritize document storage software equipped with features designed to meet relevant regulatory requirements.
RIA firms of all sizes encounter the challenge of finding solutions that fit their budgets and address their specific business needs. As RIA consultants, we understand the daunting nature of this task, especially as firms grow. Therefore, we’ll continue to look into how RIA firms like yours are addressing these very same challenges.
Tune in next week for a look at how RIA firms are using portfolio management and reporting systems and how they have gained popularity among RIA firms.