AI, compliance, and the future of wealth management: why we invested in Focal
by Hylton Irons
For decades, financial advisors have built trusted relationships on top of manual workflows. They’ve balanced spreadsheets and empathy, toggled between CRMs and compliance systems, and spent many late nights documenting conversations.
Nearly one-third of advisors now say they struggle to find client-facing time because they’re buried in repetitive tasks. In our conversations with advisors, we heard how those realities play out day to day. One advisor shared, “We used to handwrite every note, then scan and email them just to stay compliant. Every client meeting meant hours of follow-up that had nothing to do with the client.”
When we first met Focal co-founders John Connell and Jerry Bai, they shared a clear vision of improving the experience of wealth managers and their clients, utilizing the current AI transformation to build a solution where every client conversation could instantly trigger the workflows needed to serve, document, and comply. That clarity of vision was striking.
Focal is on a mission to build the connective tissue to modernize how advisors serve their clients; an automation platform that turns conversation into action.
Advisors are meant to advise. Yet today, hours each week vanish into meeting prep, note-taking, and updating the same data across multiple systems. None of those hours drive growth — but in a regulated industry, none of it can be skipped. Consider some statistics that underscore the mounting pressure on financial advisors today:
- 28% of financial advisors report insufficient client-facing time due to manual workflows and compliance obligations
- Advisor headcount has grown just 0.3% annually over the past decade, while total AUM has grown at a 7.3% CAGR over the same period
- $84 trillion is expected to transfer to younger generations by 2045, 70–90% of heirs change their advisor within the first year of inheritance
- The SEC filed over 200 enforcement actions in Q1 2025, the highest in 25 years
- Nearly 40% of all existing advisors are expected to retire by 2035
Amid these shifts, the advisor tech stack hasn’t kept up. CRMs, custodians, planning tools, and compliance archives rarely integrate intuitively. A simple change to a client’s address can require five different logins. And while new AI tools can summarize a meeting, they stop short of actually doing the work: updating forms, syncing systems, triggering archives. Without an execution layer, productivity gains stall.
Future Advisor Needs vs. Headcount
The shortage of financial advisors is not just a workforce problem; it is a capacity constraint on the entire wealth management industry. As client demand rises and a large portion of the advisor population nears retirement, the ratio of households per advisor continues to climb.
The only way firms can maintain service quality without significantly expanding headcount is through automation that amplifies individual productivity. By eliminating bottlenecks in documentation and follow-up, advisors can redirect time toward higher-value client engagement.
According to Charles Schwab’s 2024 RIA benchmarking study, the average advisor at a large enterprise RIA oversees $100 — $200 million in assets across a capacity of roughly 150 clients. Assuming a standard 40-hour work week, that translates to only about 15 minutes of attention per client each week. Even modest time savings compound quickly at that scale. If automation enables advisors to reclaim just five additional hours per week, that time could be used to serve 30 to 40 percent more clients, representing an additional $30 million+ in AUM capacity per advisor. At the firm level, those gains translate directly into higher revenue, improved retention, and greater overall impact.
Focal’s Approach
Focal enters this story not as a point solution but as an automation platform designed to rewire the advisor workflow.
Its browser-native agents work across the systems advisors already use (CRM, custodian, planning, etc.) to execute multi-step workflows securely and accurately. A meeting note will be able to automatically update records, kick off onboarding steps, and file compliance documentation. Focal doesn’t replace existing tools; it makes them smarter.
Beyond automation, Focal is building intelligence around how advisors actually work. By capturing workflow patterns and meeting data, the platform surfaces performance insights, which evolve into personalized coaching: nudging advisors toward more effective engagement strategies and proven best practices across firms.
Through continued focus on advisor learning and development, Focal will extend this capability even further — blending behavioral finance principles with workflow analytics to help advisors deepen relationships and deliver advice that’s as emotionally intelligent as it is operationally efficient.
Compliance First
What truly sets Focal apart is its architecture. As the only solution built exclusively on Microsoft Azure, its stateless AI models never retain or train on client data. It’s a compliance-first design, meeting SEC and FINRA standards while delivering the power of enterprise-grade automation. This foundation allows them to unlock early adoption in one of the most regulated industries in the world.
The team’s relentless focus and thoughtful product design are resonating where it matters most.
Looking Ahead
The $84 trillion generational wealth transfer is underway, reshaping every corner of financial advice. Firms are managing more clients with fewer advisors, under more scrutiny than ever. To stay competitive, they need to deliver smarter, faster, more personalized service. The promise of automation is shifting from an efficiency play to the foundation of competitiveness.
At Distributed Ventures, we look for companies that don’t just remove friction but fundamentally reshape the way industries operate, and behind Focal is a team uniquely qualified to deliver on this vision.
CEO John Connell, CPO Jerry Bai, and CTO Clay Stupi bring decades of experience building and scaling enterprise-grade technology and compliance platforms at Microsoft, DocuSign, Chainalysis, and leading wealth management firms. Their experience positions the team well to deliver trustworthy AI in a regulated environment.
The future of financial advice won’t be defined by who has the most tools, but by who has the smartest systems. Focal is leading that shift by building the infrastructure that allows advisors to move from manual operations to autonomous intelligence. In doing so, they’re not just saving time; they’re defining what the AI era of advice will look like.
We’re proud to partner with the Focal team as they bring automation to the heart of advice, transforming the future of financial guidance into something faster, smarter, and more impactful for clients.
