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Archive Intel Raises $1mm for Wealth Management Compliance

Archive Intel, a firm founded by industry veteran Larry Shumbres to combine communication archiving and compliance screening, announced that they raised a $1mm Seed Round from early-stage VC fund Social Leverage. From our standpoint, it's nice to see a VC stepping up and sole-funding a WealthTech startup. Hopefully, that is another signs of a thaw in the funding market.

Of course, it also probably helps that it solidly falls into one of our thesis opportunities for WealthTech for the rest of this decade: making compliance integrated, scaled, and automated. As our followers know, we separate compliance in wealth management into "regulatory compliance" and "direct surveillance". Regulatory compliance is things like establishing and maintaining licenses, creating and maintaining policies and procedures, marketing reviews, etc. These activities are usually applied at the firm level and, while technology can help significantly, it is not a gating factor.

On the other hand, direct surveillance is things like monitoring for suitability and Reg BI, identifying unusual trading activity, and of course, screening correspondence between advisors and clients. These activities are applied at the account level and thus have significant scale. As regulators move away from statistical sampling and more towards systematic, real-time surveillance, technology is a must-have, not a nice-to-have. In fact, we don't see how the firm of the future can operate without integrated, scaled, and automated direct surveillance systems. For further reading, feel free to look at our white paper on this topic.


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