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capuzzi-apex-futureproof.jpg Photo by Diana Britton
(L-R): Olivia Eisinger, general manager of advisory at Apex Fintech Solutions, Apex CEO Bill Capuzzi and InvestmentNews Technology Editor Ryan Neal

Apex May Explore an IPO If Markets Improve

Apex CEO Bill Capuzzi discusses the future of custody and the possibility of taking another run at going public.

Early last year, Apex Clearing agreed to go public via a merger with Northern Star Investment Corp. II, a special purpose acquisition company led by Jonathan Ledecky, co-owner of the New York Islanders. But last December, the SPAC pulled out of the merger agreement.

Speaking this week at Advisor Circle’s Future Proof festival in Huntington Beach, Calif., Apex CEO Bill Capuzzi said the fintech firm may again consider an IPO if the markets improve.

“The path for us, if the markets come back around over the course of the next 24 months, maybe we’ll take another run at going public,” Capuzzi said. “Otherwise we’ll keep doing what we’re doing.”

He also said the company has no aspirations to get acquired.

“The industry loses is we get acquired by someone larger.”

Capuzzi was speaking about the future of the custody business, which today is dominated by a few large firms, including Schwab, Fidelity and Pershing. Unlike some of these competitors, Apex has remained purely business-to-business and will stay in its lane of partnering with advisors.

For advisors, Apex will handle all account opening, funding, trading, money movements in or out, all the tax services and settlement.

“The differentiation versus the folks that you guys all know—the Schwabs and Fidelitys—is, we’re sort of maniacal about how do you take friction out of all of those things,” Capuzzi said.

For instance, if a document has missing or inaccurate information, an advisor typically gets back a “not in good order,” or NIGO. But Apex sends an instantaneous response as to what’s wrong with the account.

Olivia Eisinger, general manager of advisory at Apex Fintech Solutions, said another differentiator is that Apex can help advisors serve a wider swath of clients with a very digital experience. Advisors can scale their businesses with things like fractional shares and notional trading.  

“Advisory firms can essentially run the same strategies—if the risk tolerance is appropriate—for clients of all sizes, not just for their high-net-worth clients.”

Eisinger says some advisors are still concerned that the custodians with direct-to-consumer businesses are competing with them for clients.  

“There’s still concern that advisors want to work with a custodian that’s maniacally focused on building better infrastructure to solely support their business,” she said. “Part of that is collaborating with the technology companies and the asset managers and bringing the community together better in a way that supports advisors.”

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