Netwealth Group Ltd (ASX: NWL) has quietly built a powerful position in Australia's growing wealth management industry.
I think the next decade could give this tech stock, which is part of the S&P/ASX 200 Index (ASX: XJO), an even bigger opportunity as more money flows into superannuation and financial advisers continue embracing modern investment platforms.
Here is why I would be happy to own Netwealth shares for the long term.
Image source: Getty Images
More money can keep moving onto the platform
Netwealth provides the technology and administration that financial advisers use to manage investments and superannuation for their clients.
I like this business model because growth can build on itself.
An adviser who chooses Netwealth can gradually move more clients onto the platform. Existing clients can contribute more money over time, while rising investment markets can increase the value of assets already sitting there.
Netwealth finished June with $135.7 billion of funds under administration after attracting $15.4 billion of net flows during FY26.
The net flows are the figure that catches my eye. They show investors and advisers are actively choosing to place more money with Netwealth rather than growth simply coming from rising share markets.
Australia's superannuation system should also continue creating an expanding pool of assets for platforms to compete over. If Netwealth keeps winning more than its current share, I think the business could become substantially larger by 2036.
It can become more valuable to advisers
There is another part of the story I find interesting.
Netwealth does not have to rely solely on attracting more funds. It can also give advisers more reasons to use its technology.
Managed accounts are a good example. These allow advisers to manage client portfolios more efficiently while making changes across many accounts at once. Netwealth's managed account funds under management reached $30.5 billion at the end of June, almost 30% higher than a year earlier.
I think that growth says something important about the relationship Netwealth is building with advisers.
The more of their work that can be completed through the platform, the more embedded Netwealth can become in how an advice practice operates.
The company is continuing to broaden its offering as well. It recently launched Netwealth Private for sophisticated investors and an Individual HIN solution that allows advisers and clients to hold Australian securities directly while still using Netwealth's technology and administration.
That gives Netwealth more ways to serve clients whose needs become increasingly complex as their wealth grows.
There is still plenty to compete for
Netwealth has already become a major platform provider, but Australia's wealth management market is enormous.
That leaves room for the ASX 200 tech stock to keep winning advisers from older platforms and deepen relationships with the advisers already using it.
Competition will remain strong, particularly from HUB24 Ltd (ASX: HUB) and established financial institutions investing in their own platforms.
For me, that makes continued net inflows an important sign to watch. Netwealth expects FY27 net flows of between $18 billion and $20 billion, which would represent another step up from FY26 if management delivers on that outlook.
I think sustained inflows at that level could transform the scale of the business over a decade.
Foolish takeaway
Netwealth is the type of ASX 200 tech stock where I would be happy to give the investment plenty of time.
Every year of strong inflows adds more assets to the platform, while new technology can make the relationship with advisers deeper.
If that continues through to the 2030s, I think today's Netwealth could eventually look like an early chapter in a much larger story.
