US-based robo advisory firm Betterment has acquired Rowboat Advisors, expanding its line-up of investment tools for RIAs.

Rowboat offers portfolio management software, which includes features for direct indexing, tax optimisation, and personalised investing.

Established in 2016, the company has created a range of portfolio optimisation software designed for investors who prioritise “control, transparency, and tax efficiency”.

This acquisition aims to bolster Betterment’s technology platform and expedite the development of advanced tools for RIAs through Betterment Advisor Solutions.

The integration of Rowboat’s solutions into Betterment Advisor Solutions, which serves as an all-encompassing custodial platform for contemporary RIAs, is scheduled to commence in the latter half of 2025.

As part of this acquisition, Rowboat Advisors founder and CEO Iraklis Kourtidis will join Betterment’s engineering leadership team as the vice president of portfolio management, reporting directly to chief technology officer John Mileham.

Kourtidis said: “We saw a unique opportunity to join forces with Betterment’s infrastructure, helping more advisors access the powerful tools they need to best serve their clients.”

This acquisition follows a series of product introductions earlier this year, including Solo 401(k) plans and securities-backed lines of credit (SBLOCs).

Advisors can anticipate several enhancements to portfolio management this year, with direct indexing set to be available in 2026.

These enhancements include expanded support for single stocks, enabling the management of portfolios across a broader spectrum of securities, and tools that provide increased control and transparency through advanced simulations and critical data for trading.

Additionally, Betterment will offer improved automation and tax management features, such as enhanced rebalancing, tax-loss harvesting, tax-efficient portfolio transitions, asset location, and intelligent withdrawals.

Betterment CEO Sarah Levy said: “This marks a significant step forward in our mission to empower advisors with modern, automated investment tools.

“Rowboat brings exceptional talent and cutting-edge technology that will help us unlock new dimensions of tax-aware, customisable investing at scale.”

In February this year, Betterment acquired Ellevest’s automated investing business, which focuses on women.

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