Fintech Firm Oranj to Close by Year-End

Jeff Levine, tax specialist with Kitces.com and Buckingham Wealth Partners, tweeted: " Ouch. Oranj giving advisors just 6 weeks to find replacement technology. In normal times, making the shift to new rebalancing software in that short a span would be tough… But on top of year-end planning? And w/ holidays? During a pandemic?"

An Industry Trend?

The closure of Oranj comes seven months after Motif Investing shut its doors.

"This is the tip of the 'tip of the iceberg'; I estimate that we'll lose 20% of the firms in [Michael] Kitces' fintech map by this time next year," said Doug Fritz, founder and president of F2 Strategy in late April. "Many will be purchased or consumed by their equity backers. Others will close."

Some 62% of those taking ThinkAdvisor's Twitter poll in April agreed. They said Motif's closure definitely or likely signaled further closures of investment management platforms, versus 38% who saw further shutdowns as "not necessarily" likely. (Eighty individuals took the survey.)

The Motif shutdown is "a harbinger of what's to come for other small digital players, as revenues get taken out of the investment supply chain," said Tim Welsh, head of the consultancy Nexus Strategy, at the time. "Scale means everything now, so you have to be big to make a go of it."

Others, like Ezra Group CEO Craig Iskowitz, agree that "many closing announcements" are to come. "We've seen exponential growth in the number of companies trying to squeeze into this space, especially around digital advice," he explained earlier this year.

See: Investing Platform Motif to Shut Down