Italian financial software firm buys Nest Wealth

Italian financial software company Objectway acquired 100% of Toronto-based fintech company Nest Wealth, including shares previously owned by National Bank of Canada, as the Milan-based firm looks to expand in Canada and the U.S.

Objectway provides financial software to more than 200 banks, insurers, and wealth and asset management firms in more than 15 countries. Roger Portnoy, chief strategy officer for Objectway, told Advisor.ca that his company was looking to strengthen its client onboarding and financial planning offering.

“Nest is an onboarding technology company, a financial planning technology company, and an advisory technology platform and services company. So, in many ways, it was an ideal fit to find a company that had those capabilities that marry with our own,” Portnoy said.

The financial details of the deal were not disclosed.

Nest Wealth was founded in 2014 as a robo-advisor for retail investors before expanding with its Nest Wealth Pro tool for financial advisors. Its clients include asset managers, custodians and some of the big banks — including National Bank, which invested $6 million in Nest Wealth through its venture capital arm NAventures in 2017. Nest Wealth remained independent as that partnership deepened in 2020 with a commercial deal and investment that was worth up to $50 million.

The full integration of the technologies between Objectway and Nest Wealth will be completed in the next 24 months, Portnoy said. Existing Nest Wealth users in Canada will benefit from Objectway’s features, he said, but did not comment on whether the pricing will change.

“Over time, the Nest Wealth client will have an integrated solution from one provider, supported by one provider, upgraded and improved by one provider. It will be more cost-effective, more operationally effective, with reduced vendor risk,” Portnoy said.

Although Nest Wealth and Objectway’s tools will be integrated, Objectway intends to maintain Nest Wealth’s brand.

“It’s a well-known brand and we want to take advantage of the brand for now,” Portnoy said. “Our philosophy as a company is to allow local organizations to thrive and continue their own growth path, as well as integrate where it adds value.”

Objectway already has a small presence in Canada and made marketing efforts over the last five years, Portnoy said, but it didn’t experience as much success as the company hoped for as it lacked local delivery capabilities and could not manage integrations remotely. Acquiring Nest Wealth will help Objectway expand in Canada and the highly competitive U.S. market, Portnoy said.

“We have a strong commitment to grow, thrive and expand in Canada. We obviously recognize that more value can be generated on top of that by prudently going into the U.S.,” he said. “But Canada will, of course, be our first and dominant market for the starting point for our investment.”

Nest Wealth CEO Randy Cass said in a statement that the acquisition would accelerate the firm’s expansion into the U.S. and also open up the market in Europe, Africa and the Middle East where Objectway has a presence.