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SCD Advisory Supports Netwealth and Alceon in Two AI and Technology Deals
From AI-powered advice automation to a rising Microsoft partner, FACCI member SCD Advisory guided two clients through buy-side tech acquisitions.
SCD Advisory supports clients on strategic transactions across the technology and IT services landscape. Two recent mandates, Netwealth's acquisition of Paradino and Alceon's majority stake in Engage Squared, show how closely AI is now tied to deal activity.
Netwealth to acquire Paradino, a leading AI-enabled advice workflow and automation platform for financial advisers
Netwealth Group Limited (Netwealth), a leading provider of integrated platform, technology and data solutions, today announced on 16 September it has agreed terms to acquire 100% of the issued share capital of Scale Up Platform Solutions Pty Ltd, trading as Paradino, an Australian provider of AI-enabled adviser workflow and advice automation technology.
Acquisition highlights and summary
Paradino is a leading Australian AI-enabled advice workflow and automation platform serving financial advisers.
The acquisition supports Netwealth's Dx30 ambition by improving adviser productivity and capacity through the automation of key advice workflows, including AI-generated file notes, Records of Advice, Statements of Advice, advice presentations, workflow and task management, and customer profiling.
Paradino's capability complements Netwealth's existing platform, technology and data solutions and will deliver significant efficiency benefits to advisers. By combining Paradino's AI-enabled workflow automation capability with Netwealth's market-leading platform and data technology, the acquisition directly supports Dx30 by automating several of the most time-intensive aspects of advice delivery.
Upfront consideration of $20 million, comprising $15 million in cash and $5 million in Netwealth ordinary shares, with up to a further $9 million in earn-out and retention consideration payable over four years, subject to the satisfaction of agreed outcomes and milestones. In addition, Netwealth will invest a further $10 million in Paradino over the next two years to accelerate delivery of its product roadmap, expand capability and support continued growth across the Australian financial advice market.
The transaction is not expected to have a material impact on Netwealth's near-term earnings, while being strategically important to the Group's long-term growth ambitions and adviser capability strategy.
Strategic rationale
Enabling adviser growth and improving advice accessibility:
The acquisition reflects Netwealth's continued commitment to the Australian advice profession and supports advisers with productivity, workflow and technology solutions that improve adviser capacity and client outcomes.
Australia continues to experience strong growth in wealth and retirement savings, increasing the demand for quality financial advice. At the same time, adviser capacity remains a key constraint on the number of clients advisers can effectively support.
Capacity released through automation can be redeployed into serving more clients, deepening client relationships and improving access to advice. Paradino's roadmap extends beyond document production and supports a broader range of adviser workflows, helping advice businesses scale efficiently and sustainably.
Removing a critical workflow bottleneck:
Advice businesses continue to face increasing complexity, regulatory requirements and client expectations. The preparation of advice documentation and associated workflow administration remains one of the most time-intensive components of the advice process, and a significant driver of adviser capacity constraints. Paradino's technology automates a range of these activities, reducing administrative effort and shortening advice preparation timeframes. This enables advisers to spend more time engaging with clients, delivering advice and growing their practice.
Expanding from platform administration into advice workflows:
Historically, Netwealth's role within the advice process has primarily centred on advice implementation and administration through its platform capability. The acquisition of Paradino expands Netwealth's support for advisers through the generation of advice documentation, preparation and servicing workflows, extending the Group's capability beyond platform administration and broadening its role across the adviser value chain. This strategic expansion creates opportunities to deliver greater value to advisers through a more integrated experience, deeper workflow capability and increased support for advisers' day-to-day activities.
Strengthening Netwealth's data and AI capability:
The acquisition provides Netwealth with specialist AI expertise, intellectual property and workflow technology that can be integrated progressively into the broader Netwealth ecosystem. Netwealth's Unify platform already aggregates, organises and synchronises data from dozens of sources. Over time, Netwealth will combine this data with Paradino's AI-enabled automation capability to extend AI-driven advice workflows.
Pierre Briand, founder of SCD Advisory, said:
"This AI strategic deal gave SCD Advisory the opportunity to leverage our expertise and experience in the IT Services and Software space. This AI transaction is a strategic move from our client Netwealth and we wish them all the best! Adding clients, product functionalities, development capability and team support will have a significant impact on their platform and offering. Combining Netwealth with Paradino is a key AI milestone within the Wealth Management industry".
Commenting on SCD Advisory's role specifically, Matt Heine (CEO of Netwealth) said:
“SCD Advisory delivered strategic clarity and high quality guidance throughout Netwealth's assessment of this strategic acquisition. Netwealth drew heavily on SCD Advisory's sector knowledge, particularly their insight into the tech and AI services landscape.”
Transaction summary
Netwealth will pay upfront consideration of $20 million, comprising a $15 million cash payment and $5 million in Netwealth ordinary shares. The equity component will be escrowed and released in four equal tranches over four years. Up to a further $9 million in earn-out and retention consideration may be paid over four years, in approximately four equal annual tranches, subject to the satisfaction of agreed outcomes and milestones. The cash consideration will be funded from Netwealth's cash reserves and debt facility. Completion is expected by the end of October 2026 and remains subject to customary conditions precedent.
Netwealth's existing financial guidance is maintained on a pre-acquisition basis. As an early-stage business, Paradino has not yet achieved break even. Paradino's EBITDA is expected to be a loss of approximately $3 million in FY27. In addition, Netwealth will invest a further $10 million into Paradino over the next two years to accelerate delivery of its product roadmap and support adviser growth across the Australian financial advice market. Paradino's financial performance and this additional investment will be reported separately from Netwealth's underlying results.
Alceon takes majority stake in Microsoft partner Engage Squared. SCD Advisory supporting Alceon on the buy-side.
Sydney-based alternative investment manager Alceon has acquired a majority stake in Engage Squared, one of Australia's largest independent Microsoft partners, in the inaugural investment for its newly launched Alceon Private Equity Access Fund.
The deal gives Engage Squared, which employs 170 people across eight offices, access to capital and operational support to accelerate growth in artificial intelligence, cybersecurity and Microsoft-ecosystem services across Australia, New Zealand and the broader Asia-Pacific region.
As part of the acquisition, co-founder Stephen Monk will depart Engage Squared, with Alastair Cashen appointed as Group CEO who will lead alongside the existing management team, with Claudia Piscitelli appointed Executive General Manager, Australia.
Pierre Briand, founder of SCD Advisory, added:
"This marks our eighth Microsoft partner transaction and it reflects the full spectrum of configurations we advised on in this market, including buy-side and sell-side, local and cross-border, founder-led businesses and private equity platforms. Engage Squared is riding the wave of AI implementation across Australia, New Zealand and Japan, and Alceon's investment highlights how quickly this segment is accelerating. It is a clear example of private equity backing a high-performing Microsoft partner to scale at a time when demand for AI-enabled productivity solutions is expanding at pace. We wish Engaged Square and Alceon great success in this journey, which represents Alceon's first investment in their newly launched Alceon Private Equity Access Fund".
Commenting on SCD Advisory's role, Zac Midalia concluded:
“Engage Squared sits in a part of the Microsoft ecosystem that is moving quickly, and we wanted a clear view of it before we committed. SCD Advisory gave us that view, backed by commercial diligence we could rely on and clear advice on how the opportunity fits within the broader sector. Their invaluable knowledge of the space gave us conviction in our investment decision.”
