BlackRock Buys FutureAdvisor, Bolstering Robo Capability

Money manager chases Fidelity into automated portfolio construction.

BlackRock

BlackRock has reportedly bought robo-advisor software startup FutureAdvisor in a play to target young wealth management clients.

The deal will see FutureAdvisor — which generates client portfolios based on investment objectives, income, and tax at lower fees — integrated into BlackRock Solutions, which is a separate business from BlockRock's $4.7 trillion asset management arm.

FutureAdvisor is valued at between $150 and $200 million, after starting life as a startup at San Francisco's Y Combinator, and will continue to operate on a separate stack following the buy. The move comes after Fidelity introduced Betterment, another robo-advisor, into its Institutional Wealth Services business in 2014.

Other brokers have developed similar capabilities in-house as the technology continues to gain favor among diversified buy-side giants.

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