LPL Financial plans to migrate recently acquired Commonwealth Financial Network advisors off Advisor360°, the technology workstation originally developed inside Commonwealth and spun out as its own company in 2019. Those advisors will move to LPL's platform, ClientWorks, according to regulatory disclosures reviewed by WealthManagement.com.
Commonwealth's current contract with Advisor360° effectively ends on Monday, the date beyond which LPL has no commitment or obligation to continue the Advisor360 contract, though it may adjust terms to complete the transition. The firm does not plan to work with Advisor360° after the conversion. An LPL spokesperson said the firm has been working with Advisor360° on the transition and to ensure the integrity of client data.
LPL closed on its acquisition of Commonwealth and its 2,900 affiliated advisors last year. Firm executives have said it is on track to complete the onboarding of most of those advisors to the LPL platform in the fourth quarter. One Commonwealth advisor, who declined to be named, said they would go live on ClientWorks in mid-November, although LPL could not confirm that date. Commonwealth will continue to operate as a community within LPL, with its own service professionals and experience, the advisor said.
The move represents a significant loss for Advisor360°, according to industry observers. Tim Welsh, president, CEO and founder of Nexus Strategy, said the development raises questions about the technology firm's revenue replacement strategy in a contracting broker-dealer market. "It's a blow to Advisor360°," Welsh said. "When you lose your flagship client, there's no way to sugarcoat that one. And then it just raises the question, how do you replace that revenue? The broker/dealer market is shrinking. It's not growing, so you've got to think that their potential could be limited in the near future."
Welsh said the move was inevitable and made sense for LPL, given the firm's massive tech infrastructure and nearly 30,000 affiliated advisors. But he argued that Advisor360°'s technology was more innovative. "Whenever you're supporting 30,000 advisors … you have to manage the lowest common denominator and build out systems with controls and regulations that limit what people can actually do with the system," he said. "You would assume that Advisor360° was more innovative and user-friendly than the big monster factory of LPL."
The migration means Commonwealth advisors will have to learn to navigate the new operating system, Welsh added. "Your staff, your employees, you yourself, the advisor, you have to start over with a whole new system, whole new approach," he said. "There's bound to be hiccups, and that impacts client service. That is a big challenge for anyone making that big system-wide swap."
Advisor360° was developed in-house at Commonwealth in 2004 and spun out as an independent business in 2019. It is now run by President Darren Tedesco and CEO Michael R. Fanning. The software company has added other clients since the spin-out, including MassMutual, King Financial Network, GWN Securities, Allstate Financial Services, Barnum Financial Group, Luedtke and Associates and Baystate Financial.
This month, the company announced that Merit Financial Advisors, an RIA with $26 billion in assets under management, had approved Advisor360° as a supported technology platform for its advisors. Merit also announced a strategic partnership with Advisor360° competitor OneVest in March. Late last year, Advisor360° announced an artificial intelligence-native platform rewrite of its system, meant to enable any advisory firm, from a solo practitioner to a large IBD, RIA or insurance broker-dealer, to run on a single foundation of data to better power workflows and integrations and enable the use of agentic AI.
In a statement, a spokesperson for Advisor360° said the firm "remains committed to supporting transition activities consistent with its contractual obligations." The company did not provide further comment on the contract termination or its business outlook following the LPL migration.