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Corporation
hub24.com.au

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Partners & Customers

4

About Hub24

HUB24's investment and superannuation platform offers a comprehensive range of investment options, including superior administration, transaction and reporting solutions, for individuals, companies, trusts, associations and self-managed super funds. Hub24 utilizes state-of-the art technology to deliver a fully integrated service that helps advisers track and better manage investments and superannuation assets.

Hub24 Headquarter Location

123 Eagle Street Level 18

Brisbane, Queensland, 4000,

Australia

1300 854 994

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Latest Hub24 News

Can Praemium catch tearaways Netwealth, Hub24?

Oct 17, 2021

The wealth platform pioneer failed to capitalise on its innovative head start, but a new CEO believes the fintech can meet and even surpass its much-hyped rivals. Share Few wealth management industry experts would begrudge Praemium credit for its role as an early developer of administrative technology platforms used by financial advisers to manage client assets, now a $900 billion segment. But you wouldn’t know it from comparing the company’s share price to those of its fellow specialist platform innovators Netwealth and Hub24. Janie Barrett Since listing in 2006, Praemium’s shares have mostly traded below their debut price of 48¢. It took more than a decade for the investment administrator to beat its March 2007 high of $1.21, hitting a record $1.28 in August. They closed at $1.16 on Friday. A reasonable investor might view it as a redemption story, given it was trading at just 7¢ in mid-2012. But compared to its competitors, the comeback looks somewhat less impressive. Hub24 and Netwealth have each tripled their share prices since they listed in 2007 and 2017, closing at $33.06 and $17.23 on Friday respectively. As a result, Praemium’s market capitalisation of $590 million sits well below Hub24 at $2.2 billion and Netwealth at $4.2 billion. Advertisement   Naturally, the disparity is a reflection of inferior earnings growth, revenue, and share of the hotly contested platform market. And for some long-suffering Praemium shareholders it has been a bitter pill to swallow. “It’s the biggest missed opportunity in Australian financial services history,” says a substantial Praemium shareholder, who asked not to be named. “Praemium should have been a $10 billion company. It was the first to see the potential for independent managed accounts and platforms, it was even before Hub.” ‘Getting our act together’ Advertisement “There’s no doubt they captured a larger share of the platform market compared to us on the first part of that journey,” Wamsteker says of the market darlings Netwealth and Hub24. “We don’t shy away from that. You don’t get any better unless you acknowledge where others have done better than you. “But we are getting our act together. Our growth rate is catching up and ultimately we would like to surpass them.” Increased expenditure on sales and marketing will allow it to finally claw more new business from financial advisers and take the fight to the tearaway competitors, he says. Increased regulatory focus on advisers choosing best-of-breed products for clients also helps, he says, given Praemium’s is widely acknowledged as “one of the best technology stacks” in the wealth management industry. Lucrative niche Aside from new business, Praemium’s July 2020 takeover of longstanding client Powerwrap, where Wamsteker was previously chairman, will create efficiencies, the CEO says, and open up new revenue streams. Advertisement The combination of Praemium’s proprietary technology and Powerwrap’s lucrative niche of private wealth advisers – who control half of the industry’s $1.2 trillion under advice despite accounting for just 10 per cent of the workforce – is a winning one, he adds. Previously both companies were desperately trying to catch Hub24 and Netwealth while expensively developing their own products. The pending sale of its UK and Middle East operations – which market sources have described as a “big distraction” for Praemium that stopped it capitalising on the rise of independent financial advice firms that made Hub24 and Netwealth rich – is “progressing well” and would provide a cash and energy injection, Wamsteker says. Equity analysts seem to agree with the assessment. “With leadership now settled, we see a clear strategic direction, a strong financial position and potential corporate appeal for both the international and Australian divisions,” said research from Ord Minnett in August, reiterating its "buy" rating. Marketing spend Barrenjoey’s Nicholas McGarrigle wrote in August: “Praemium’s tech rebuild is now bearing fruit. Once the international business is sold, the high-growth, profitable Australian business should come into focus and have heightened corporate appeal”. He pointed to a “refreshed sales team” as one of the positives going forward. Advertisement Nonetheless, Praemium’s 2020-21 financial year results missed consensus estimates, and EBITDA fell by 1 per cent over the year. That was primarily attributed to the increased sales and marketing spend, which analysts overwhelmingly said was necessary. “We’re not alarmed nor surprised by increases [in expenditure],” wrote Shaw & Partners analyst Danny Younis on August 16. Some have speculated that Praemium itself may be sold to one of the offshore buyers running the rule over its international business. That may prove a boon for the company (depending on the buyer and price) but also creates uncertainty. More broadly, Citi analyst Siraj Ahmed has pointed out that the movement of financial advisers between financial services licensees – which has been a key driver of Hub24 and Netwealth’s surging growth – is starting to “slow”. Advertisement That means Praemium may have missed its moment to claw business away from the big bank-owned incumbents. Long-dormant platform operators such as AMP and IOOF are now investing in their product suites, giving their advisers fewer reasons to flee. As for Netwealth and Hub24, they each claim they will extend their lead. Asked what he thought about competitors beginning to pump capital into product development, Hub24 chief executive Andrew Alcock told the Citi Australia and New Zealand investment conference last week: “I think the renovation is interesting, but you’ve still got innovators pushing ahead. We’re now trying to disrupt ourselves.” As another Praemium shareholder puts it: “It’s good that Anthony is there and we at least have a shot, but there’s a hell of a lot of catching up to do.” Aleks Vickovich is the wealth editor. He writes about financial advice, funds management, superannuation and regulation, with a special interest in the next generation of investors. Connect with Aleks on Twitter . Email Aleks at aleks.vickovich@afr.com Save

Hub24 Acquisitions

2 Acquisitions

Hub24 acquired 2 companies. Their latest acquisition was Xplore Wealth on March 02, 2020.

Date

Investment Stage

Companies

Valuation
Valuations are submitted by companies, mined from state filings or news, provided by VentureSource, or based on a comparables valuation model.

Total Funding

Note

Sources

3/2/2020

Acq - P2P

3

12/21/2016

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$991

$99M

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10

Date

3/2/2020

12/21/2016

Investment Stage

Companies

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Valuation

$991

Total Funding

$99M

Note

Acq - P2P

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Sources

3

10

Hub24 Partners & Customers

4 Partners and customers

Hub24 has 4 strategic partners and customers. Hub24 recently partnered with Clearview AI on March 3, 2020.

Date

Type

Business Partner

Country

News Snippet

Sources

3/18/2020

Client

Clearview AI

United States

ClearView cuts key platform deal with HUB24

Platform provider HUB24 has won a key mandate , being selected by ClearView as its strategic wrap platform provider .

1

8/27/2018

Partner

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10

5/9/2016

Vendor

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10

6/24/2013

Partner

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10

Date

3/18/2020

8/27/2018

5/9/2016

6/24/2013

Type

Client

Partner

Vendor

Partner

Business Partner

Clearview AI

Country

United States

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News Snippet

ClearView cuts key platform deal with HUB24

Platform provider HUB24 has won a key mandate , being selected by ClearView as its strategic wrap platform provider .

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Sources

1

10

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10

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