Complect: Bringing the Gig Economy to Compliance

If you are a large RIA firm, you probably have a compliance consulting firm or a compliance attorney on retainer. If you are a smaller firm, you probably do not. If you fall into the latter category, it is possible that you have off-the-shelf documents that do not accurately reflect your business, or you may struggle to complete some compliance-related task that might better be handled by a specialist.

Complect, a new online marketplace of compliance resources, could fill a real need for many RIA firms. It may also be the answer for B/D’s, investment managers and other financial professionals who need occasional compliance and regulatory support from a qualified professional. The firm, founded by a former employee of ACA Compliance Group, provides a platform where financial professionals can post compliance projects (for project-based work or full-time employment) to a network of financial regulatory compliance specialists with a minimum of three years of direct compliance experience.

Businesses can post one-off project, hourly engagement, or full-time roles on the site and wait for, or prompt, qualified specialists to apply. Businesses can also hashtag their own prerequisites for the role to automate part of their screening process. Applicants can then be interviewed before the right one is selected for the project or role.

BRINGING MARKETFORCES INTO PLAY

Once a specialist is chosen, Complect takes care of the payment process through their automated billing and invoicing system. Moreover, the skills hashtag system allows specialists to stay abreast of market trends among their peer group.

Complect is not a platform where specialists bid competitively for projects. The folks at Complect believe that such a system is counterproductive.  On this platform, you set the budget you are most comfortable with and leave it to market forces to dictate whether the pay you are offering is commensurate with the work you are expecting.

Typically, a premier consulting firm may charge anywhere from $300- $1,000/hour for their specialists depending on seniority. Many employees only see a fraction of the fee that they are billed out at, so by connecting through the platform, both buyers and sellers can profit.

Like many other marketplace platforms, Complect makes its money based on the value of projects completed on the platform. When the system draws a payment for a project, it will automatically include an additional 10% fee on the charge to the business account and it will automatically withhold a 10% fee from the payment to the specialist. For example, if both parties are matched for a $1,000 project then the business will pay $1,100 and the Specialist will receive $900.

In the case of full-time roles, the business alone will bear the fee, which they may choose to incur as either (1) 15% of first year salary payable on the employee’s start date and refundable if employee leaves within 90 days; or (2) 3% of first year salary payable monthly for six months beginning on the employee’s start date, with the stipulation that if the employee leaves within six months, monthly payments are no longer due after termination date.

POTENTIALLY DISRUPTIVE FORCE

To date, matching services within the financial advisory space have met with mixed results, however this platform seems like one that may be of interest, particularly for small- to mid-sized firms.

It will be interesting to see how the market reacts to this potential disruptive force.

Publisher’s note: T3 recently rolled out a site where companies in the FinTech and Financial Services community can post jobs and look for new talent. Currently, it is free for companies to post jobs. It will always be free for job seekers, such as recently graduated students at the nation’s top PFP programs, to post their resumes and look at the job postings on the site. At some point in the future, there will be a small fee to post “help wanted” ads. So give it a try and see if you might just find the new talent and help you’re looking for: www.T3TechJobs.com.

Joel Bruckenstein
Joel Bruckenstein
Joel P. Bruckenstein, CFP®, is Publisher of the T3 Tech Hub (formerly the T3 newsletter) and the producer of the Technology Tools for Today (T3) Advisor Conference, the only annual technology conference for independent advisors, as well as the Technology Tools for Today (T3) Enterprise Conference. Bruckenstein is an internationally acclaimed expert on applied technology as it relates to the financial service industry. He is the co-author of three books: Virtual Office Tools for a High Margin Practice, Tools and Techniques of Practice Management, and Technology Tools for Today’s High Margin Practice. Joel’s monthly technology columns appear in Financial Advisor magazine and Financial Planning magazine. In addition, he compiles the annual technology survey for Financial Planning magazine. Bruckenstein has for more than twenty years advised financial service firms of all sizes on improving their technologies, processes and workflows. For more information about Joel Bruckenstein and the services his firm offers, please visit www.JoelBruckenstein.com

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