Clearstead Pairs Rapid Growth with Strong Security and Compliance

As companies grow, their challenges often grow along with them. Clearstead Advisors, a Cleveland-based registered investment advisor with the SEC offering comprehensive financial services, has learned this firsthand. In the past five years, it has roughly doubled its staff, tripled its assets under management, and opened several new office locations. The only challenge? This growth led to data sprawl, inconsistent IT usage, and heightened challenges in navigating a rapidly evolving regulatory landscape. 

Partnering with Egnyte has empowered the firm to gain control over these critical challenges without impeding its growth in the process.

Challenge: Inconsistent IT Threatens Compliance

The more staff and acquisitions Clearstead brought on, the more employees needed to access the company’s data from different locations. Steven Wolken, Chief Compliance Officer at Clearstead, knew this paradigm was only sustainable if there was uniformity in the systems people used to access the data – something Clearstead lacked. “Some offices were using SharePoint, some were using local servers, some were using cloud. Clearstead needed a system that could consolidate networks from its multiple locations,” Steve explains. “Clearstead needed to address how people saved data. Locations were saving data by client, some by year, and others by service. All of this created data sprawl, and the resulting lack of visibility into what content was stored where and how it was being shared created potential risks.”

The intensifying regulatory landscape governing the financial sector only ratcheted up the stakes of managing this sprawl. In recent years, financial service companies like Clearstead have faced a patchwork of federal and state privacy and compliance regulations requiring them to maintain full visibility into what client data they have in their systems and where it resides. As Steve explains: “At the federal level, you have the Gramm-Leach-Bliley Act (GLBA), which regulates how financial institutions handle client’s nonpublic personal information. Then you have a patchwork of state-level privacy laws, plus international regulations like EU GDPR. The growth we were experiencing made it hard to ensure all the data in our multi-system environment was monitored, and it only got more challenging as we grew and new regulations kept changing.”

The firm tried several approaches to unifying its disparate IT environment, including using VPNs to connect remotely to offices and attempting to implement SharePoint as a potential solution. But users complained about challenges in areas like file access and collaboration. “SharePoint, in particular, was not an adequate solution,” says Dennis Kasper, Senior Managing Director, Systems and Cybersecurity at Clearstead. “File changes took hours to sync, resulting in conflicting versions. Users hated it. It got so bad we ended up going back to on-premises file management.”

Solution: Leverage Egnyte to Unify Data Environment

Clearstead kicked off a search for a modern, cloud-based file management platform that would enable the company to scale a unified infrastructure to all its remote offices. The team began evaluating Egnyte on the recommendation of several partners and vendors who were using the platform. “Egnyte checked all the boxes,” says Edward Mielcarek, Managing Director, IT Operations at Clearstead. “It performed well, was extremely scalable, and had a great, feature-rich user interface.” Perhaps the most important aspect of that interface was the presentation of data through a mapped file drive, which was aligned with the way users had developed workflows with their previous systems and therefore allowed them to navigate their content in a way that worked for them.

Critically, Egnyte provided the speed and easy file access that was necessary to overcome the user resistance that made VPN reliance and SharePoint untenable. “Our users need to share data freely. They’re not willing to compromise on speed and access. Egnyte was a great solution for these folks,” Dennis says. With user resistance out of the way, Clearstead was able to consolidate its IT from its disparate systems into Egnyte – a massive step toward reducing the data sprawl that had previously caused so much trouble.

Through features such as Secure & Govern, Egnyte also provided essential support in meeting the intensifying regulatory demands facing the financial sector. As Steve puts it: “As we continue to grow and add more data, not only do we need to monitor and protect client data with strong security measures, we also need an easy way to catalogue it. That’s a huge part of regulatory compliance for financial service firms. And those governance capabilities are built right into the Egnyte system.”

Benefits: More Confidence in Compliance and Security

With Egnyte, Clearstead has been able to neutralize its data sprawl issues and position itself to meet compliance requirements in an evolving regulatory environment – all without creating userexperience challenges that could hinder its ability to get its work done efficiently. “The SEC has increased its focus on cybersecurity, which will only require more governance and monitoring capabilities from firms like ours,” Steve says. “Working with Egnyte allows us to address new regulations.”

On the user experience side, Dennis emphasized the importance of Egnyte’s file explorer interface, noting that "to me that is the anchor that allows us to do other things". He explained that while document management solutions can be a drastic change for users accustomed to Windows File Explorer, Egnyte provides a familiar foundation upon which a document management experience can be built. This foundation positions Clearstead to move forward with rolling out more advanced features, such as metadata tagging and automated workflows, available through Egnyte's web interface, and also to restructure their data for better accessibility and leverage.

Now that Clearstead’s data is migrated into Egnyte, the firm is looking to further improve its process with Egnyte features like metadata tagging and workflows. For other financial firms dealing with data sprawl and compliance demands, Edward has some advice: “Don’t wait to switch to Egnyte. We should have done this a long time ago. Now that we have, I’m really excited to keep learning more about how we can use the platform to further improve our security and governance posture and make our user experience the best it can be.”