Updated Friday, July 25, 2014 as of 2:45 AM ET
- RIAs
Ousted LPL Exec Advising Planning Startup
Financial Planning
Thursday, February 27, 2014
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LPL's NestWise may be dead, but its former chief wants its mission to live on.

Esther Stearns, the former head of LPL’s now-defunct mass-market planning offering, is advising startup Guide Financial in its quest to “carry the NestWise torch” to the planning marketplace, she says.

“This is a tool very much in the tradition of the technology that we had at NestWise,” says Stearns of the San Francisco-based software firm, which is selling its budgeting and cash flow tool to independent planners as well as those in large financial institutions.

Guide offers a web-based interactive service that advisors and clients can use together to dynamically manage cash flow and savings goals, according to the firm’s cofounders, Uri Pomerantz and Scott Burns.

“These really big cash flow questions are typically ignored by a lot of advisors, because they don’t have the tools” to address them, says Pomerantz, Guide’s CEO.

Through a partnership arrangement, Intuit provides secure access to accounts at 19,000 financial institutions, according to a Guide announcement. The product can also integrate with major custodians and broker-dealers and it is available as a stand-alone tool or a customizable private-label service, the firm says.

Nearly 100 advisory firms have registered to use the product with their clients, the cofounders say. The cost is currently $30 a month for unlimited use of the tool, but the cofounders expect to raise the price.

NESTWISE DEMISE

Burns and Pomerantz say they followed NestWise's trajectory closely, and approached Stearns for help after LPL shuttered the unit for failing to meet expectations.

“It’s been really interesting working with someone with so much experience who really does think differently,” Pomerantz says of Stearns. “She does really think about how to do the best for people and not just about how to make money.”

Stearns’ unpaid advisory role at Guide leaves “all the heavy lifting” to the management team, she says. After working “head down” for 30 years, she says, she’s not looking for full-time work at the moment.

But her desire to see full-service planning extended to mass-market customers remains undimmed, she says. She is also advising another Bay Area startup, ClearStreet, that uses a community-based approach to encourage users to build savings. Former Sun Microsystems executive and Marimba founder Kim Polese is ClearStreet’s chairman.

MOVE TO S.F.

After being laid off, Stearns says she and her family, which includes three teenage children, moved from suburban San Diego to downtown San Francisco. Guide is based in the city.

In Stearns’ view, Guide addresses a central concern of average Americans by facilitating behavior modification and regular engagement with a family's finances. “How do I get those assets to invest?” she asks. “That’s the question that really haunts the middle-class investor.”

Guide, she says, is “really hitting that expense management piece, [which] is so important.”

Unlike NestWise, which sought to build a nationwide network of advisors to serve the middle class, Guide's founders say they aim to put cost- and time-effective tools in the hands of existing advisors.

"We see this" -- selling software into the existing ranks of advisors -- "being the most scalable model out there,” Pomerantz says.

 

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