BILL CRAGER ANNOUNCES DECISION TO TRANSITION FROM CEO OF ENVESTNET AFTER MORE THAN TWO DECADES AT THE COMPANY
- Bill Crager to continue as Senior Advisor, focusing on client and partner relationships
- Board of Directors to initiate a search for a successor
- Board Chair James L. Fox to serve as interim CEO effective April 1, 2024
- Company reaffirms fourth quarter and full year guidance
- Envestnet has grown into a leading managed solutions service provider with $5.4 trillion in client assets and over 107,000 advisors served*
- None.
Insights
Envestnet's announcement regarding the CEO transition could have implications for investor sentiment and market perception. Historically, CEO transitions can lead to volatility in a company's stock as markets react to potential changes in strategic direction and leadership style. However, the appointment of James L. Fox as interim CEO and the continuation of Bill Crager as a Senior Advisor may mitigate some concerns by ensuring continuity in leadership during the search for a permanent CEO.
The reaffirmation of Q4 and full year 2023 guidance provides a stabilizing factor for investors, signaling that the current management team expects the company's performance to remain on track despite the upcoming leadership changes. The projected revenue and adjusted EBITDA figures suggest that Envestnet is maintaining a growth trajectory, which is a positive sign for stakeholders.
The governance implications of this transition are significant. The Board's decision to initiate a search for a successor, considering both internal and external candidates, indicates a commitment to due diligence in leadership selection. This process, assisted by an independent executive search firm, is a best practice in corporate governance, aiming to ensure the best possible candidate is chosen for the role.
Furthermore, the active role of the Board Chair as interim CEO reflects a proactive approach to governance. It is important to note that the effectiveness of this interim arrangement will depend on the Board Chair's ability to manage the dual responsibilities and the eventual smooth handover to a new CEO.
For investors, the financial stability of Envestnet, as indicated by the reaffirmed guidance, is a crucial factor. The forecasted revenue range for Q4 2023 and the full year, along with the adjusted EBITDA, suggests that the company is not only growing but also managing its profitability. Adjusted EBITDA is a key metric for assessing a company's operating performance, as it excludes non-recurring items and provides a clearer picture of ongoing financial health.
Envestnet's position as a leading managed solutions service provider with $5.4 trillion in client assets underscores its significant market presence. The company's ability to serve over 107,000 advisors reflects its scale and the robustness of its business model. This scale could provide a competitive advantage and serve as a buffer against market fluctuations and competitive pressures.
Crager to Continue with Envestnet as a Senior Advisor effective March 31, 2024
Board of Directors to Initiate a Search for a Successor
Board Chair James L. Fox to serve as interim CEO effective April 1, 2024
Company Reaffirms Fourth Quarter and Full Year Guidance
"For more than 24 years, it has been my privilege and honor to work with Envestnet, creating an industry leader. We now serve more assets, more financial advisors, and more accounts than anyone in the marketplace. Together, we have built a more integrated, cohesive organization with a connected operating platform that provides a gateway to the future for the industry," said Crager. "Starting in April, I will have the time and opportunity to focus on what I have always loved doing – growing Envestnet's relationships and empowering our clients to provide holistic financial advice and solutions. This transition gives me a front-row seat for our next chapter and I look forward to continuing our journey."
Envestnet's focus on client excellence and service is unwavering. Tom Sipp, Executive Vice President, will continue to lead Envestnet's business lines partnering closely with Crager and Board Chair James L. Fox, who will serve as interim CEO as of April 1, 2024, until a successor is in place. The Board of Directors will initiate a search for a successor, considering internal and external candidates, with assistance from an independent executive search firm.
Under Crager's leadership, Envestnet has grown into a leading managed solutions service provider with
"Bill has been a driving force of Envestnet since he co-founded the company with Jud Bergman in 1999. They established the vision for our company and Bill has led the charge in the ongoing expansion of the firm's innovative financial wellness network. He is an inspirational leader who set the bar for our quality client solutions and services. Bill also built a strong and experienced management team and we're confident in their ability to continue to execute our strategy," said Fox. "On behalf of the Board and the entire company, we want to thank Bill for all he has done for Envestnet as CEO and his continuing partnership."
The Company reaffirmed its fourth quarter and full year 2023 guidance announced on November 8, 2023. As stated in the Company's Q3 2023 earnings materials, Envestnet expects its fourth quarter 2023 revenue to be between
*as of Q3 2023
ABOUT ENVESTNET
Envestnet is transforming the way financial advice is delivered through an ecosystem of technology, solutions, and intelligence. By establishing the connections between people's daily financial decisions and long-term financial goals, Envestnet empowers them to make better sense of their finances and live an Intelligent Financial Life™. With more than
Envestnet refers to the family of operating subsidiaries of the public holding company, Envestnet, Inc. (NYSE: ENV). For more information, please visit www.envestnet.com, and follow us on LinkedIn and X (@ENVintel).
Cautionary Statement Regarding Forward-Looking Statements
The forward-looking statements made in this press release and its attachments concerning, among other things, Envestnet, Inc.'s expected financial performance and outlook for the fourth quarter and full year of 2023, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties and our actual results could differ materially from the results expressed or implied by such forward-looking statements. Furthermore, reported results should not be considered as an indication of future performance. The potential risks, uncertainties and other factors that could cause actual results to differ from those expressed by the forward-looking statements in this press release include, but are not limited to, the concentration of our revenue from the delivery of our solutions and services to clients in the financial services industry; our reliance on a limited number of clients for a material portion of our revenue; the renegotiation of fees by our clients; changes in the estimates of fair value of reporting units or of long-lived assets; the amount of our debt and our ability to service our debt; limitations on our ability to access information from third parties or charges for accessing such information; the targeting of some of our sales efforts at large financial institutions and large financial technology ("FinTech") companies which prolongs sales cycles, requires substantial upfront sales costs and results in less predictability in completing some of our sales; changes in investing patterns on the assets on which we derive revenue and the freedom of investors to redeem or withdraw investments generally at any time; the impact of fluctuations in market conditions and interest rates on the demand for our products and services and the value of assets under management or administration; our ability to keep up with rapid technological change, evolving industry standards or changing requirements of clients; risks associated with our international operations; the competitiveness of our solutions and services as compared to those of others; liabilities associated with potential, perceived or actual breaches of fiduciary duties and/or conflicts of interest; harm to our reputation; our ability to successfully identify potential acquisition candidates, complete acquisitions and successfully integrate acquired companies; our ability to successfully execute the conversion of clients' assets from their technology platform to our technology platforms in a timely and accurate manner; the failure to protect our intellectual property rights; our ability to introduce new solutions and services and enhancements; our ability to maintain the security and integrity of our systems and facilities and to maintain the privacy of personal information and potential liabilities for data security breaches; the effect of privacy laws and regulations, industry standards and contractual obligations and changes to these laws, regulations, standards and obligations on how we operate our business and the negative effects of failure to comply with these requirements; regulatory compliance failures; failure by our customers to obtain proper permissions or waivers for our use of disclosure of information; adverse judicial or regulatory proceedings against us; failure of our solutions, services or systems, or those of third parties on which we rely, to work properly; potential liability for use of inaccurate information by third parties provided by us; the occurrence of a deemed "change of control"; the uncertainty of the application and interpretation of certain tax laws; issuances of additional shares of common stock or issuances of shares of preferred stock or convertible securities on our existing stockholders; changes in the level of inflation; general economic, political and regulatory conditions; changes in trade, monetary and fiscal policies and laws; global events, natural disasters, environmental disasters, terrorist attacks and pandemics or health crises, including their impact on the economy and trading markets; social, environmental and sustainability concerns that may arise, including from our business activities; and management's response to these factors. More information regarding these and other risks, uncertainties and factors is contained in our filings with the SEC which are available on the SEC's website at www.sec.gov or our Investor Relations website at http://investor.envestnet.com/. You are cautioned not to unduly rely on these forward-looking statements, which speak only as of the date of this press release. All information in this press release and its attachments is as of January 8, 2024 and, unless required by law, we undertake no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this press release or to report the occurrence of unanticipated events.
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