Docupace’s paperless management system is widely used by Cetera, other firms
Jan 5, 2016 @ 1:43 pm
While soon-to-be bankrupt RCS Capital Corp. considers what to do with its majority stake in Docupace, experts say the paperless processing system used by thousands of advisers is unlikely to go away anytime soon.
RCAP is evaluating “strategic alternatives” for the technology provider, the company’s press release on the Chapter 11 bankruptcy stated on Monday. RCAP spokesman Andrew Backman said there were no further updates.
Docupace is geared toward financial service firms, and has been the system of choice for Cetera Financial Group, which has 9,500 advisers and is spinning off as its own independent firm. Along with document management, the company offers cybersecurity services, including vulnerability assessments and ongoing monitoring. Its core offering, ePACS, offers processing for more than 70,000 users.
The main question isn’t if Docupace will dissolve, but where will it find a new home. Neal Quon, co-founder of QuonWarrene, a technology consulting firm for the financial services industry, said the system is too popular to be wound down.
“I don’t think Docupace is going away,” Mr. Quon said. “It is being used too heavily.”
In September 2014, RCAP acquired a majority stake in Docupace.
Neither Docupace or Cetera Financial Group responded to a request for comment.
Because RCAP is filing a Chapter 11 bankruptcy, the company will be reorganizing its structure. Mr. Quon said RCAP may look to reposition Docupace.
“I would probably bet it is one of the more viable assets left in RCAP’s portfolio,” he said.
Chad Chubb, founder and adviser at WealthKeel in Philadelphia, which offers securities through Cetera Advisor Networks, said it makes sense if Cetera were to take Docupace with it in its spinoff. He uses Docupace because it is mandatory for Cetera representatives, but uses Box.com, another document management system, for his registered investment adviser side of the business. He said he would use Box.com entirely if it weren’t mandatory to use Docupace.
“Any time you invest time into learning the technology, you don’t want to make a change,” Mr. Chubb said. “That’s the only downside if for some reason Cetera would not bring over Docupace.”