Microsoft’s array of subscriptions can be overwhelming and lead to confusion for RIAs. Additionally, many RIAs are not fully utilizing Microsoft’s features, instead opting for third-party tools that may not be as effective. In this episode, we talk about the differences and which one fits your firm best.
NOTE: While Microsoft’s subscription offerings may change in the future, for now, this is the current landscape.
Subscription Options
Microsoft offers a productivity suite called Microsoft 365, which can be categorized into three main groups:
M365 for Home
- Not recommended for RIAs.
M365 for Business
- Commonly mistaken for what RIAs need, but not the optimal choice.
M365 for Enterprise
- Specifically, the Microsoft 365 E5 subscription is recommended for RIAs, despite common advice against it due to perceived overkill. However, RIAs have unique needs that align more closely with enterprise-level requirements.
More information
- Ensure you own the tenant for your Microsoft subscription.
- Consider the flexibility of monthly vs. annual commitments, especially when dealing with seasonal employees or interns.
- For more information
Despite Microsoft’s confusing subscription structure, their products offer great solutions for RIAs. While the naming conventions may be perplexing, opting for the Microsoft 365 E5 enterprise subscription is the best choice for RIAs.
Listen To The Audio:
Read The Transcript:
Todd W. Darroca
Hello and welcome to the RIA Tech Talk podcast, brought to you by RIA Workspace. I’m Todd Darroca, and alongside me is David Kakish. And together we are on a mission to simplify the complex world of technology for RIAs just like yours. So in this podcast, we’ll be your tech guides breaking down those often confusing tech topics into plain and practical terms for you. And so we hope you join us every episode as we dive into the latest tech trends. We’re going to share our expert insights and help you navigate the ever-changing world of RIA technology. So let’s get started today. Today, David, what are we focused on today? What are they going to learn today?
David Kakish
Alright, so the title of today’s session is What Microsoft Subscription Should I get from My RIA? And I was joking with you, Todd, before the call like, ah, this shouldn’t be a topic of a podcast. I said, why is it so confusing to just go order office, right? Or the productivity suite with Microsoft? And yes, it is a little bit confusing. There is a perfect and ideal one for the RIA and that’s what we’ll be talking about. But initially I’m like, ah, this shouldn’t even be a podcast topic. And yet I compare it to Apple. You go to apple.com and they’ve got their seven products, seven, eight products listed right there, Microsoft, they make some great products, but it’s really confusing what to buy and what’s the right one for my RIA.
Todd W. Darroca
So why does it even matter for the RIA? I mean, what are they going to take away? What should they learn? Why is it important to them?
David Kakish
Yeah, so two things, right? There’s two big problems that I see. Number one is just, it’s really, really confusing to hey, what’s the right subscription for my RIA and there is the right one. And then number two is this. Microsoft has some really great features that an RIA could really leverage and use. And again, most RIAs are not using those features and some are using third party tools that are more expensive than even subpar, I would say to what Microsoft offers. It’s just that not a lot of RIAs know about that. And to make it even worse, not a lot of IT providers know about that because again, most RIAs from a headcount perspective, if you think five to 30 employees, we’re not talking about hundreds or thousands of employees and things like that. So it makes a pretty big difference. So listen, by the end of this, you’re going to know what’s the best one for your RIA and I’ll even say it upfront.
And then if you want to tune in and learn more, great. If not, that’s okay, I’ll just share that. But when you go to Microsoft’s website right now, there’s the Microsoft Productivity Suite, like what we think of Office 365 or Microsoft 365 and things like that. It really falls in three categories, right? Microsoft 65 for home, Microsoft 365 for business, and then Microsoft 365 for enterprise. Those are kind of the three that you look at and I’ll kind of dissect each one of them, but if you want the big takeaway and not listen to the rest, go with Microsoft 365 Enterprise E five subscription. If you’re like, Hey, listen, I just want to know what it is, I’m going to go to my IT provider and get it, get the Microsoft 365 E five enterprise subscription and then you can disappear. But there’s a lot of insights that I’ll share with you as a listener that I think you’ll get out of this.
Todd W. Darroca
I think it’ll be important too, keep listening because sometimes IT provider’s going to say, Hey, that’s too much bang with E five. So hopefully you guys stay tuned and some tips from David, I have to have that conversation. But yeah, David, as a normal person looking at Microsoft, I do. I am not kidding. I was buying Microsoft Office last week because my subscription ended and I honestly didn’t know I wanted the cheapest version, but then I kept seeing E three, E five, and so I was really like, well, what are these now? Do I need to have these as just a consultant and small business owner? So I get it. This is kind of one of those topics where it’s like, really? But I think in the long run it’s definitely helpful.
David Kakish
Yeah. So I’m going to keep it really simple, right? I’m going to pretend you’re an RIA with nine employees, right? You could obviously have a lot more or a lot less, but whatever you’re an RIA with nine employees, what’s the right subscription? What’s the best subscription I should say for your RIA and why? Now, you said something really important. I am talking about the Microsoft Enterprise E five, which for many businesses that nine employees is an overkill. And the IT provider that tells you that it’s an overkill, they are absolutely right. It’s an overkill for a business across the street with nine employees, but not your business. Now because you’ve got millions and sometimes billions in assets under management, you’re a lot different than that business across the street that has nine employees. And that’s really the fundamental difference for that. So they are right when they tell you it’s overkill, but it’s overkill for that other business, but it’s not overkill for you because there’s a lot of enterprise or big business security features that you can leverage and then you can go ahead and you can use.
So there’s a couple of things that I really want to share right off the bat before I talk about the different additions, but I want to make sure that if you’re listening to us, you want to make sure you do it this way. And again, it doesn’t matter how large or how small your RIA is. One of the fundamental things that you want to make sure that you do is you actually get your Microsoft subscription and you get what’s called your own tenant or think of it as your own private network. And what I mean by that is you don’t want to be under your IT provider or under your broker dealer. You don’t want to be under their account. Think of them being a parent account and your child account because they actually would own that. And the reason for it is, A, you want to make sure you own it.
And then B, if you ever want to leave that broker dealer in the future, you ever want to leave that IT provider. Everything is in your name. Let me contrast that to analogy, an analogy that the listener will relate to. It’s like when you get your own domain name, right? ABC advisors.com, you don’t let your web company own that. You get ABC advisors.com and you own it with GoDaddy, network solutions, whoever, and then you let the website company build the website, but you actually own that. What we sometimes see in this space is people are getting the Microsoft licensing as if they’re a child or a sub account of the master account of the IT provider or the broker dealer. Do not do that because what happens is if you ever want to leave them, you’re really locked into them and it’s a pain in the butt to leave them because you basically have to create a new separate account if you do it under your own tenant or under your own name. What that basically means is, Hey, look, five years from now, two years from now, whenever you want to leave that IT provider or you want to leave that broker dealer, that tenant or that private Microsoft network is in your name, you just change the partner of record and then you don’t have to move everything around and you’re not locked in or tied into that broker dealer or that IT company. So I wanted to touch upon that a little bit because it, it’s subtle, but it’s really key that you do that.
Todd W. Darroca
Is it typical for the IT provider to say, no, you’re going to be a child account under mine and is or is it typical where it’s kind of a tough conversation to have with them like, Hey, no, no, no, I want to own that. What’s your experience on that been?
David Kakish
Great question. From a best practices perspective, most IT providers really should set you up with your own tenant, but I’ve seen it where they don’t necessarily do that or they set it up but they own it, but it’s in your name and you want to make sure it’s in your name and that you own it, and then you put them as a partner of record. So they extend that analogy so people can understand that. For example, you’re going to buy a network firewall for your office. You want to make sure when you’re buying it that it’s in your RIA a’s name, not in your IT provider’s name because who owns that after the relationship ends? And so it’s that same analogy, but the one that most RIAs are very familiar with is the domain name. You want to own that regardless of who does your website.
It’s the same thing. And so it’s not a tough discussion to have with the IT providers. Most of them understand from a best practices perspective, that’s what you should be doing, but some of ’em are goofballs and they don’t want to do that. So I’d be careful from an IT provider that does not want to do that. And then the other side of it is too, some RIAs, not all of them, but they’re working with a broker dealer, somebody that helps with a bunch of other services, and many of these companies will put you in as a sub account of theirs. Don’t do that. It’s like I’m telling you, you’re going to be locked into ’em, and if you ever want to leave and change a broker dealer or change who’s providing all these value ads, we do it all the time. So we’re pros, we’re experts at it because we have to go in and do it. But what that basically entails doing is building another environment or another network, private network at Microsoft and then moving everything over. If it was done the right originally, it’s yours, you own it, you’re just changing the partner of record, but none of the data is moving or the email or any of that type of stuff.
Todd W. Darroca
Got it. I’m going to ask you about paying for it. And there’s always this healthy argument I guess of do I buy something month to month or do I get locked into a contract so I get stuck with it? What is your recommendation here? Because right now I have done the annual plan just because I know I’m going to use it as part of my work.
David Kakish
Listen, so the way that Microsoft does their licensing, you can pay month to month or you could do an annual plan paid monthly, and I’m talking about their enterprise plans, the home one, I think it’s a one-time thing. So the way most of our clients, it’s not like six months from now or two years from now, you’re going to stop using Word, Excel and Outlook. So my recommendation is like, look for your full-time. Regular employees, just get the annual plan and you pay it monthly. So again, you’re paying it monthly, you’re just locked in for a year. If you have part-time employees or seasonal employees, think around tax season, maybe you have interns in the summer, things like that. You want to get the month to month subscription for those employees. So keep it simple. You’ve got nine employees. You hire an intern in the summer for your regular nine employees, get the annual paid monthly subscription for the intern in the summer for three months, get her the month to month subscription, and then after three months you can cancel that because if you don’t, the only time you can downgrade your license with Microsoft is at the renewal date, the annual renewal date.
So that’s what I would recommend. So you can mix and match the annual and the month to month.
Todd W. Darroca
Got it. So let’s dive into the whole multiple names for the same kind of thing. E five, E four sounds like a tornado coming at you. So let’s walk me through what the difference is for all these products they’ve got.
David Kakish
Right. I don’t think Microsoft is listening, not our audience, but Microsoft, if you’re listening, please go to apple.com/store, learn from Apple to what they’re doing because they’ve really spelled out what you can buy. So you go to microsoft.com/store, you’re like, oh my goodness, what am I getting? An Xbox A game? It’s so confusing. Alright, so just to recap really quick, there’s Microsoft 365 for home. There’s the Microsoft 365 for business, and there’s a Microsoft 365 for enterprise. I’m going to talk about each one of them. Let’s start out with the first one, Microsoft 365 for home. This is fantastic. If you are using it for home, I would not use it for my RIA, I would not use it for my business if I were an RIA and Microsoft gives you two options here. You can buy it, it’s $70 if you’re an individual or it’s a hundred dollars if you’re a family. And a family can be anywhere from two to six people. I want to say that you can put it on many devices. It’s not tied into the number of devices or computers. It’s the number of people. So at home, personally, I have the home package, but I’m also a goofball. I have the Google package and I have the Apple package and stuff like that.
But anyways, yes, and some people really like to do that so they can create the separation between home and work. And I would highly recommend that you do that if that’s what you do. But again, this is great for personal, for your home. I would not use this for my RIA. Okay. Alright, so we’ll set that aside. Now, the second subscription that they have, if you sort of look at the overall category is Microsoft 365 for business, which is different than Microsoft 365 for enterprise, right? I’m going to get to the enterprise, that’s the third one. But Microsoft 365 and noticed I said Microsoft 365, not Office 365. Those are two different things. So yeah, so what Microsoft has here, they basically have four options. Option number one is Microsoft 365 basic. Option two is Microsoft 365 applications for business. Number three is Microsoft Business Standard.
And number four is Microsoft 365 Business Premium. That’s why I said it gets kind of confusing, but let’s talk about the first two, Microsoft 365 basic. That’s basically the web-based version of the Microsoft applications. Word, Excel, PowerPoint, outlook, and then you get teams in OneDrive, SharePoint and Exchange. So think of it as that’s the web-based version of the Microsoft apps, Microsoft 365 apps for business. That’s where you just get the apps like the desktop, the web and the mobile version of the apps. Word, Excel, PowerPoint, outlook, and OneDrive. That’s somebody who wants to use Generally speaking, that’s somebody that wants to use the Office suite on their computer. So these two are not very popular. The two big ones under Microsoft Business is Microsoft Business Standard, very popular. And then Microsoft 365 Business Premium, again, very popular and most businesses with nine employees, either one of these is actually really good for your RIA.
I’m going to talk in a little bit why you want to look at Enterprise, but back to Microsoft 365 Business standard. It includes the Office suite, like Word, Excel, PowerPoint, outlook, and so on. It includes the services like OneDrive, SharePoint, exchange for email, and that’s fantastic. The Microsoft 365 Business Premium includes everything in the standard plus security. So it adds cyber advanced cybersecurity and device management like computers and iPhones and things like that. And if this is really confusing, it’s okay, I’m going to talk about the enterprise. That’s really what you’re going to focus on. And then we’ll also include some links in the show notes. But again, the two popular ones under the regular business package is Microsoft 365 Business Standard and Microsoft 365 Business Premium.
Todd W. Darroca
So I’m dumb here. So what is the real difference then between 365 apps for Business and 365 Business Standard? It seems like they have the same features, but maybe just different services.
David Kakish
That’s where you start adding OneDrive, SharePoint exchange for email and stuff like that. So think of the apps for your computer as you’re just, it’s really the old way of buying the office suite for your computer. Remember we used to buy it on a CD and install it,
Todd W. Darroca
Go to Staples, get that big old box. Yeah!
David Kakish
Think of it as this way. That’s basically what the apps for business are. It’s for people that don’t necessarily want to use Microsoft email and SharePoint and OneDrive, but they want to use the applications. So for example, Todd, in your case, and I don’t know if this is still the case or not, but somebody that is using the Google G Suite, right? Google Workspace, but they absolutely love Outlook and they absolutely love Word and Excel and stuff like that. What that allows you to do is to have your email and your calendar all sort of in Gmail, but then you’re using Outlook and Word and Excel and things like that. So that’s where it’s pretty applicable. That’s why I said it gets kind of confusing, but most businesses, they’re either looking at business standard or business Premium, but your RIA, we really want to be looking at the enterprise.
Todd W. Darroca
Got it.
David Kakish
Thanks for that. Alright, so I covered a lot and I talked a lot and I hope it wasn’t confusing, but Todd, I’ll come back to you. Any questions or anything you wanted to share before I talk about Microsoft 365 for Enterprise?
Todd W. Darroca
The only one is, so if I do all of the 365, the basic standard, do they all come with teams or is that only the basic that comes with the teams?
David Kakish
Yeah, no, they don’t all come with teams. Okay. Yeah, they don’t all come with teams. Okay. It’s helpful to know what I’m doing. My team there, think of Teams, OneDrive, SharePoint, and Exchange as a service. So if you were to break it out in applications and it’s services, the applications or the Office suite, like word Outlook, stuff like that, the services is where you’re using Teams, OneDrive, SharePoint, and then the actual email. Got it. Anyways, it gets kind of confusing and that’s why I said Microsoft, if you’re listening, go to apple.com. So just so you know, this should not be a podcast topic, but here it is, they’re talking about this and if you’re a visual person, we’re going to include some links. You can kind of go in and that really helps me because there’s a whole matrix of everything that’s spelled out. And then for those that are very, very, very analytical, there’s a spreadsheet with, or I’m sorry, there’s a PDF and it spells out every single line item.
I’m not really going to talk about it on the podcast, I’m going to lose some people, but if you’re super analytical, there’s a PDF, we included, and it spells out every single line item. That’s the difference. Okay, got it. Cool. Alright. Alright, so now finally do the part that I want to talk about, Microsoft 365 Enterprise. So if you look on the Microsoft website and you click on Microsoft 365, there’s a whole section for small business or business and then home. Go to the other section that talks about Microsoft Enterprise, and I’m not going to show it because Microsoft keeps changing their website, but go to the Microsoft 365 for enterprise section, and this will make a lot of sense if you go on that section. Microsoft is going to have four broad categories, office 365, Microsoft 365, and then they have nonprofit and then government and stuff like that.
So we’re not going to talk about nonprofit or government or education. Those are different. So the Microsoft 365 enterprise, it generally falls in two categories. There’s Office 365 and there’s Microsoft 365. We do not want Office 365, we want Microsoft 365. What Office 365 is basically the office suite and they have different variations of it. They call it the Office 365 E three and the Office 365 E five. This is not what you want. What we want is the Microsoft 365 E five. And if you look under that category, there’s a Microsoft 365 E three, and then there’s the E five. The E five includes everything in the E three plus a lot of advanced security and compliance capabilities. The other thing that it includes is if you want to use Microsoft Teams as your external phone system, like your hosted WIP system, you can absolutely do that with a Microsoft 365 E five.
Some of the advanced things that this really includes that you don’t need to pay for third party tools anymore is like single sign on advanced endpoint protection on your computer. The next generation, like firewall, intrusion prevention, next generation clientless, VPN archiving for your email and for your teams and your files. Again, you don’t need to have a third party tool to do that. Data loss prevention for email files, teams, and endpoints. And what that basically is, is at a very basic level, if I send out an email with a social security number, it’ll detect it, encrypt it, send it out, and then notify your CCO.
There’s just so many advanced security features that are in here, geo blocking. And what I mean by that is, hey, we can block access from outside the US if all of your employees are working here. And so there’s just a ton of security features that are built in there. So again, Microsoft 365, not Office 365, there’s an E three subscription and there’s an E five subscription. You want to get the Microsoft 365 E five subscription. And again, again, I’m touching in broad strokes, but we’re going to include A PDF that spells out every single, again, not everybody’s interested in this, but I know there’s a couple of people that are very analytical that want to see every single line item that’s there. And we’re going to go ahead and we’re going to include that there. So you can go ahead and take a look at it. Yeah, I’ll just leave it at that. Alright, Todd, I hope that this makes sense to you. I hope this makes sense to the listener. I wanted to circle back with you to see if you had any insights or questions for me that you wanted to ask.
Todd W. Darroca
No, it feels like Microsoft, I mean they give you a lot and they got to figure it out a little bit, but it sounds like though the main takeaway that you’re giving our listener here is Microsoft enter 365 E five, that seems to be the best bang for your buck and really what’s going to make your business be stable and have all the tools they need. And that’s what it sounds like.
David Kakish
Yeah, absolutely. Absolutely. So that is, again, and I hear this all the time, where somebody will go in and say, Hey, I talked to my IT guy or my IT person or my local IT provider, and they told me this is overkill and I hear it all the time. I go, absolutely, it’s overkill for a business with nine employees that’s across the street from you, but it’s not overkill for you because these are all the advanced security features that we want to make sure that we have enabled. And one of the really big ones is the cloud identity security. If you think about that right now, so many things are tied into your work email, think about single sign on into Orion and Salesforce and e-money and all that stuff, whether you’re using single sign on or not, but all this stuff that’s tied into your email in the advanced security to go along with that. So identity management, and for those of you that are familiar with Microsoft, the old name was Azure Active Directory or Active Directory Services, and Microsoft recently changed its name to intra id, which is very confusing. Geez,
Todd W. Darroca
Microsoft, call me, I’m a marketing expert. Let’s get this fixed for you, man.
David Kakish
That’s right, Todd. So you know exactly what That’s right. I forgot you’ve got a strong marketing background.
David Kakish
Drives me nuts. It’s insane. It’s insane. And why they would call the business one and the enterprise one, E three and E five, I don’t know, call it like E seven and E nine or something to make any sense.
David Kakish
Yeah. So anyways, very confusing. I guess, Todd, before I go back to you, Microsoft makes some great products. It’s confusing. I wish I didn’t have to even talk about this. I can’t believe it’s been 20 minutes that we’ve talked about this, right? I’d rather be talking about other things, but for your home on the personal side, yes, get the home edition for your RIA for your business. Again, whether you’re three or 30 employees, get the enterprise E five subscription that’s going to make a really, really, really the Microsoft 365 E five subscription that includes everything in office and more. And I’ll just sort of leave it at that. And if you have questions or if you want to know more about it, look at the PDF or contact us and we’re happy to answer.
Todd W. Darroca
Awesome. Well as always, David, bringing the expertise and making sure we get to our goals successfully with the right tool. So thanks again for joining us, David, and obviously thanks again for you for listening to the RIA Tech Talk podcast brought to you by of course, RIA workspace. And hey, if you like the show, make sure you like and subscribe it. It really does help. And so also for any more resources or any of our other podcasts, go to RIA workspace.com and check out the learning center. And feel free to reach out to us with any questions or topics that you’d like to cover. Again, this is a two-way conversation. We’d love to hear from you, and we hope you join us next time for more insights into the RIA world and we’ll see you next. Thanks so much, everybody.