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The Robinhood effect popped up again, as Schwab slashed its stock commissions to zero and forced TD America, E-trade, Interactive Brokers, Ally Invest, and Fidelity to follow suit over the next few days. Schwab called this the zero commission brokerage war, on CNN. This war is just the beginning of a broader trend that will […]
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Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer – No.3 influencer in the finance sector by Refinitiv Global Social Media 2019. The Vanguard effect is well known in the ETF market and now it could extend into the digital advisory space. The Vanguard Digital Advisory service is pending SEC approval. Vanguard`s […]
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Abaka conversational AI for financial advice I took the rolling escalators to the Gallery at King`s Place where the annual Robo investing 2day conference takes place, thinking about The cash piles that wealthy people are stacking away in the UK market – FFI = Funds Flow Index by Calastone The frustration of the asset management […]
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TLDR. Napster blew up the music business with free and illegal. Then we had low cost and legal like Spotify, Pandora and iTunes. The same is happening to innovation capital. The summer of 2017 ICO, kicked off by Bancor, was the now illegal way to raise a lot of money easily and at virtually no cost. That was a lousy deal for investors and naturally then regulators jumped in.
This update to The Blockchain Economy digital book covers:
What is broken in the legacy innovation capital business
In March 2017, in Crypto equity via ICO and the other innovation chasm we wrote that:
“Most entrepreneurs understand the chasm between MVP (Minimum Viable Product) and PMF (Product Market Fit). The low cost to build MVP increases supply, but real demand does not change that fast, so lots of MVP ventures fall into the chasm (i.e. they fail).
The next chasm is less well understood. This is the chasm between PMF and Liquidity (via an IPO on the Public Markets and failing that via trade sale).
Today, we don’t see this chasm so clearly because there is a very expensive bridge across it – in a few locations. The very expensive bridge is provided by the big PE/VC Funds.”
Why the ICO went too far in the opposite direction
In 3 hours that shook my world: the Bancor ICO in June 2017 we described Bancor raising over $150 million in 3 hours in an ICO that kicked off the ICO craziness in 2017 when ventures could raise huge sums on not much more than a “minimally viable white paper”. The ICO went too far in the opposite direction – good for the entrepreneur and bad for the investor.
The news about Blockstack and Reg A
The news as reported in many media outlets was that the SEC gave Blockstack the go-ahead to conduct a $28 million digital token offering under Regulation A (which enables smaller companies to raise money from the public with less strenuous accounting and disclosure standards than a traditional IPO).
This is big news because the SEC is creating a new protocol for token offerings under Reg A. This is tokenized early stage crowdfunding. While neither tokens nor crowdfunding are new, this the first time they have been combined in a global market that US public investors can participate in.
America has been losing ground in crypto as it was not perceived as a friendly regulatory environment. This news is a big win for American entrepreneurs and investors.
Reg A Basics
“is an exemption from registration for public offerings. Regulation A has two offering tiers: Tier 1, for offerings of up to $20 million in a 12-month period; and Tier 2, for offerings of up to $50 million in a 12-month period. For offerings of up to $20 million, companies can elect to proceed under the requirements for either Tier 1 or Tier 2.
There are certain basic requirements applicable to both Tier 1 and Tier 2 offerings, including company eligibility requirements, bad actor disqualification provisions, disclosure, and other matters. Additional requirements apply to Tier 2 offerings, including limitations on the amount of money a non-accredited investor may invest in a Tier 2 offering, requirements for audited financial statements and the filing of ongoing reports. Issuers in Tier 2 offerings are not required to register or qualify their offerings with state securities regulators.”
Blockstack Basics
Blockstack describe themselves as the” easiest way to build decentralized apps that can scale” and claim over 120 independent developer teams that have built apps on Blockstack.
Like Ethereum and many ICOs, Blockstack is a developer-focussed open source platform. It is the sort of innovation that the crypto community needs.
Jurisdictional competition will continue
In Some Governments Want To Shut Down Bitcoin But They Don’t Know How we wrote that:
“For a long time, entrepreneurs faced competition and regulators sent them the rule book. Regulators were government employees who thought about competition only in the abstract; competition was something that other people had to worry about.Today, the environment is more fluid as governments recognize the economic return on innovation in terms of jobs and GDP growth. The regulators now face real competition because their political masters have to keep citizens happy and citizens care about jobs and GDP growth. Both Fintech upstarts and incumbent global banks are increasingly mobile; so jobs can disappear fast if regulators get it wrong. Plus, innovation is the primary driver of productivity which drives GDP per capita. Pity the poor regulator who must balance that with protecting citizens from fraud and enforcing existing laws.”
This jurisdictional competition is a good thing because while, the SEC may have got it almost right with Reg A and the Blockstack token offering, there is still room for improvement. If you look at the details, you will see that accredited investors get in early and the public get in later. The public gets in earlier than they do in a traditional IPO, but this is still a two tier market. In a global market with jurisdictional competition, expect big moves by Singapore, Hong Kong, UK, Switzerland the EU and other tech/finance centers.
Context & References
3 hours that shook my world: the Bancor ICO in June 2017.
Crypto equity via ICO and the other innovation chasm
Some Governments Want To Shut Down Bitcoin But They Don’t Know How
Bernard Lunn is a Fintech deal-maker, investor, entrepreneur and advisor. He is CEO of Daily Fintech and author of The Blockchain Economy.
I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post.
Subscribe by email to join other Fintech leaders who read our research daily to stay ahead of the curve. Check out our advisory services (how we pay for this free original research).
The post Amazingly, the SEC may have got it almost right with the Reg A Blockstack token offering and this may define a new innovation capital market appeared first on Daily Fintech.
Blockchain and AI are the most trending technologies. Blockchain for Finance and AI for Finance ventures are also increasing. The combination is hoped to fuel the autonomous financial infrastructure that will host all kinds of intelligent applications in capital and financial markets.
LiveTiles brought to my attention 20 AI Blockchain projects with a great infographic. As I have profiled a few of them in 2017 at the protocol layer and the data-finance verticals, I decided to catchup with Numerai. They had grabbed my attention 2 years ago in this primer I wrote: The Big Hairy Audacious Goal of Numerai: network effects in Quant trading
Numerai is creating a meta-model from all the Machine Learning (ML) algorithms developed by “the crowd” with cryptographic data. Numerai aims to offer a platform that generates alpha in a novel way. It wants to structure a rewarding mechanism for its traders that not only eliminates the typical competitive and adversarial behavior between them but actually, penalizes them. Efi Pylarinou
Numerai was and is a bleeding edge venture. It remains the only hedge fund built on blockchain and using ML and data science in a novel way. The novelty lies in changing the incentive and compensation structure of the fund manager.
Numerai launched no ICO. The NMR token was awarded to the thousands of data scientists for creating successful machine-learning based predictive models. Once the data scientists are confident of the predictive ability of their model, they can stake their NMR and earn additional NMR if they are correct.
Numerai involves a staking mechanism.
In March, Numerai reported that $10million had been rewarded up to date. NMR tokens were distributed via airdrops initially. At launch on 21st February 2017, 1 million Numeraire tokens (NMR) were distributed to 12,000 anonymous scientists. Thereafter, NMR tokens were awarded as rewards to users of its platform. Bear in mind, that if a participant stakes NMR and their model doesn’t perform, the staked tokens are burnt.
According to Numerai, the NMR token is one of the most used ERC20 tokens. By end of 2018 reporting 25,000 stakes of NMR.
Almost 200,000 models submitted by data scientists around the world for a competition to crowdsourced the best prediction models.
Source from Chris Burniske`s talk at Fluidity Summit in NYC.
Numerai in March raised $11mil from investors led by Paradigm and Placeholder VCs. Numerai is a very rare case because this fundraising is not for equity but for NMR tokens.
Numerai token is a utility token and investors just bought $11million of NMR tokens.
The funds raised will primarily be used to drive the development of Erasure, a decentralized predictions marketplace that Numerai launched.
What does this mean in plain worlds?
Numerai was not a protocol but rather an application – a hedge fund. Erasure will transform it into a protocol. This has several significant implications.
A protocol is born out of the app Numerai – its name is Erasure. Erasure is much broader than a hedge fund, as all sorts of prediction and data markets can be built on the protocol. The vision is to always to be a token that is actually used. Which brings to the spotlight the lack of transparency around data measuring use of protocol and Dapp tokens.
Footnote: Numerai at launch was backed by Fred Ehrsam, Joey Krug, Juan Benet, Olaf Carlson-Wee and Union Square Ventures.
The Big Hairy Audacious Goal of @numerai : network effects in Quant trading https://t.co/LiMJu0gN9L by @efipm via @dailyfintech pic.twitter.com/l8vwRzt1Bf
— Efi Pylarinou (@efipm) June 6, 2017
Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.
I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post.
Subscribe by email to join Fintech leaders who read our research daily to stay ahead of the curve. Check out our advisory services (how we pay for this free original research).
It was four years ago that Schwab and Vanguard stepped into the robo-advisory market and leapfrogged the standalone top US robo advisors, Betterment, Wealthfront, and Personal Capital. SigFig was also a big contender at the time but has pivoted since into a predominately B2B business.
Anyone interested in reviewing the baby steps in grabbing market share and luring those holding cash to invest, can review a series of past posts[1]. Fintech startups and incumbents with low-cost investment asset allocation services, great customer onboarding, and relatively simple investment choices; have been trying to serve Unadvised Assets.
The top five robo advisors by AUM are 3 Fintechs and two incumbents. They have accumulated over $187 billion in AUM.
Source: Robo-advisors With the Most Assets Under Management -2019
The growth has been double-digit, the kind that VCs like. Despite the fact that robo-advisors have clearly not lowered the customer acquisition cost (CAC) and ironically, in most cases have been deploying the same old-fashioned channels to acquire customers[2]; VCs have been generous in funding them. Just for the top three Fintech robo-advisors, Betterment, Wealthfront, and Personal Capital VCs have invested ($275, $204, $265) nearly $745million.
The market share (as measured by AUM) amongst the top 5 US robos, is 20%-80% between Fintechs and incumbents.
One of the metrics that I had chosen to follow from the very beginning of the robo-advisory trend, was Unadvised Assets – cash in physical wallets and in checking & savings accounts. For me, Unadvised Assets are a measure of the market opportunity for robo businesses. Deloitte reported in 2014 that in the US there were close to 13 trillion of such, unadvised assets.
Looking at the Q3 2018 U.S. Federal Reserve report[3] and recent Money data, from grandmothers to hedge funds holding cash, in overnight money market funds, to checking accounts and currency; I realize that
Robo-advisors have had none or negligible impact on Unadvised assets.
In the US, Unadvised assets continue their solid growth. In 2016, I had reported $13.4trillion and now we are looking at $14.5trillion. An 8+% growth over the past 3yrs.
Unadvised assets in the Euro area, have grown from a total of 10.3 trillion EUR to 11.8 trillion EUR – a 14+% growth over the past 3yrs.
In the UK, from 1.56trillion GBP to 2.4 trillion GBP – a 5+% growth over the past 3yrs.
Cash continues to be up for grabs, for robo-advisors, for P2P lenders, for crowdfunding platforms, and tokenization platforms.
When will Unadvised Assets shrink? Will the digitization of capital markets (with the rich variety of technologies and business models) overtake the trends in fiat monetary policy, public markets, and human behavioral psychology?
[1]Nov. 2015 Salivating for Unadvised assets: a videographic
March 2016 Digital Wealth management: a videographic update
Nov. 2016 Oh, the things you could do with the enormous Cash pile!
[2] Advertising, mailing services, cheap initial offers….
[3]https://www.federalreserve.gov/releases/z1/20181206/z1.pdf
Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.
I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post.
Subscribe by email to join the 25,000 other Fintech leaders who read our research daily to stay ahead of the curve. Check out our advisory services (how we pay for this free original research).
Goldman Sachs is one to watch.
It is an example of how sticky a banking brand name is – It has shredded off scandals in the past and the recent Malaysian state-run fund scandal seems no different. Sack Goldmans – a 2010 slogan – did not stick.
Goldman Sachs is an example of how an incumbent builds a Fintech business positioned in the value stack below its established competence – an investment bank getting into retail banking and wealth management for mass affluent & the hoi polloi.
Goldman Sachs is an example of how an incumbent financial institution can grow Data pools by offering free access to its analytical tools SecDB – explained in my article in the 2018 WealthTech Book `Empowering Asset Owners and the Buy Side`.
Goldman Sachs is an example of how an incumbent financial institution can grow Data pools by partnering with Apple on a credit card – Apple has 900 million devices and it is expected that the Apple Card will bring 21 million users to GS by year end[1].
Goldman Sachs is a publicly traded company that is trading right now below book value and there are more than enough GS analysts out there to get estimates on the revenues from the different GS `consumer banking` new initiatives.
For now, Goldman Sachs has been building up aggressively deposits (the usual way of offering above-market deposit rates when entering a new market). The 3yr old deposit business has accumulated now $46billion across the US and the UK! The expected growth is in the order of $10billion per year going forward.
Marcus has issued $5billion in personal loans. These are unsecured loans that naturally, may worry shareholders, who typically get nervous easily (even though this is crumbs when taken in context).
The credit card part of the Goldman Sachs business is newer and could also grow at double-digit annual rates. Goldman Sachs knows well that credit card lending gets favorable regulatory treatment – less capital is required against this kind of debt – and as long as this holds it is a win-win situation. Why? Simply because Goldman Sachs will get their hands on valuable data from retailers and their shoppers, in order to process the Apple credit card application.
Goldman Sachs hits two birds with one stone. It gets to issue consumer debt on a global scale with lighter capital requirements, and it gets to process new, valuable consumer data globally.
The Apple & Goldman Sachs card economic terms are not known. Even if they are not that juicy for Goldman Sachs and even though the GS logo is on the back of the Apple card; the consumer data access and processing from 40 countries that this brings to the table is invaluable.
The Apple & Goldman card will grow an important global data pool for Goldman Sachs to leverage in its planned WealthTech offering.
In case you haven’t noticed, Marcus has been moved into the Goldman Sachs asset management unit, which will be renamed the consumer and investment management division. The October 2018 memo says that Marcus has plans to “launch a broader wealth management offering.”
A global consumer outreach is being built in preparation of this broader wealth management offering. And for all those concerned about a growing unsecured loan book, Goldman has great risk management experience and could with great elegance securitize part of this debt, once there is enough to do so. Elizabeth Dilts and Anna Irrera, raise this point too in ` Goldman’s Apple pairing furthers bank’s mass market ambitions`.
Marcus is a brand whose heritage is in risk management and investment banking. They will use these competences to manage growth in their retail-focused wealth management offering. This is a huge advantage compared to Fintechs that started with unbundling a specific financial service (be it loans, or deposits, or investments) and is now, growing by rebundbling additional services (e.g. adding robo-advisors to loans, or deposits to trading, ect).
I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post.
I have written about Marcus several times.
Just after the launch of Marcus in late 2016, Will Goldman become a verb? Watch the Marcus ads!
Just after the Marcus rebranding and UK launch in Fall 2018, Welcome Marcus to the rebranded Goldman asset mgt division and to the UK
I must however, confess that I have no idea how to interpret the new Marcus Campaign ‘You Can Money’. Is this an example of new Fintech language? If you have other such rarities, please send them to me, as I collect them. Maybe we can tokenize them, with the hope that they become the next non-fungible craze.
[1] A Seeking Alpha article that includes several links, for anyone who wants to dive into more details https://seekingalpha.com/article/4251792-buy-goldman-sachs-apple-card
Sources: CNBC, Barrons, Financial Brand, Crowdfundinsider, The economist
Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.
Subscribe by email to join the 25,000 other Fintech leaders who read our research daily to stay ahead of the curve. Check out our advisory services (how we pay for this free original research).
Watch the gap; between the Attention Economy and financial services.
Market forces are fiercely at work to start closing this gap. I shared insights around this reality and ways that financial services players can participate successfully in this transformation, during my opening talk at the annual event by the Bank Innovation Competence Center[1], at Unil, HEC Lausanne. I also listened to different perspectives regarding `Les robots au front-office`.
Actual experiences and learnings from:
Julius Baer, a 10yrold pure wealth manager[2], has already deployed a Digital Investment Advisory suite – called DIAS – in their Luxembourg operations and is in the process of adopting it in its home base. This is a technology stack deployed to empower the Relationships managers of JB so that they can focus on relationships, offer customized insights and reduce the burden of the ever-growing regulatory requirements.
Undoubtedly, the unbundling of financial services that have been instigated by standalone Fintechs, has essentially commoditized several aspects of financial services. Wrapping value-added advice around products and transactions is inevitable and that is what JB is aiming at. For now, and from JB`s experience, there has been no JB customer that has left from private banking to go to a standalone robo-advisor.
Swissquote, the Swiss tech born online bank, has developed its own `robo` offering. Their heavily quantitative approach is well known from the suit of their financial products and services. An online automatic but discretionary approach to investing was a very natural extension of their successful e-trading business. One of their first learnings was that personalization is needed for the automation process. Through a close collaboration with Neuroprofiler, a Swiss-born behavioral finance risk profiler out of the Kickstart accelerator, they offer a dynamic automated risk profiling with gamification elements[3].
Swissquote`s robo is used by some of their end clients but also by asset managers and financial advisors that use the Swissquote technology. The two main learnings are that one of the main in-house uses of their robo capabilities, is from existing customers that leave cash in their accounts without doing anything. Think, for example, a customer using the Swissquote e-trading platform that has often cash that is not at work.
Evidence that robo-advisors can be of value-add to customers that leave cash sitting in their accounts due to inertia.
Swissquote is continuously improving their offering by experimenting with Big Data and AI that can enrich the interaction with customers beyond and in addition to their dynamic risk profiler. Think of an algorithm that sends an sms asking `Dear Efi, ahead of BREXIT, would you want to consider switching off the robo algorithm?`.
Digifolio, is the BLBK robo advisory offering powered by the B2B technology of True Wealth, a Swiss robo that also runs its own B2C offering. BLKB is the most innovative Swiss cantonal bank with an early online mortgage offering and a digital earthquake insurance offering. Digifolio was launched in the summer of 2017 (with a minimum requirement of 5k CHF). One of their main learnings up to now, is also that success can be clearly attributed to the effectiveness of Digifolio to move existing customers from cash in their account, into investing.
As early as 2015, I had introduced the concept of `Unadvised assets`[4] and since, have been looking at ways that Fintechs can `nudge` and grab the piles of cash.
3yrs ago, my 2min view
Digital Wealth management: a videographic update, March 2016
In addition to robos, Oh, the things you could do with the enormous Cash pile! November 2016, in which I looked at `competing` unbundled Fintech offerings.
Thanks to the market feedback shared at the BAICC event, I will be updating the `Unadvised Assets` perspective to check if there has been any noticeable impact on the cash pile possibly from rise automated investing offerings at the B2C and B2B2C level.
PostFinance, a Swiss financial service provider that has been investing in Fintechs for a while, has launched a text chatbot in collaboration with ELCA, a Swiss IT company. Postfinance is the first Swiss bank launching a customer-facing chatbot on its website. This is part of their business goal to offer 24/7 service with no queuing (as in the case of live online chatting with an `agent`) as one of the advantages of text chatbots is the simultaneous handling of requests.
The global chatbot market is expected to reach $1.23 billion by 2025according to a recent report by Grand View Research[5]. The challenges however to adopting chatbot technologies are not negligible. As ELCA explained, there needs to be a clearly defined business goal before designing a suitable chatbot, that of course, needs to be trained with the relevant content. Add to this, the complexity in the chatbot market because of the incompatible between text chatbot interfaces and voice user interfaces. In simple words, the language used and the content for training text chatbots is very different from that of voice chatbots. For example, in text chatbots often answers are provided in the form of links, which cannot work in voice chatbots.
Tech integration is always more complicated than it seems at the surface. Both because of legacy system integrations but also because experimentation maybe needed until the suitable product fit is determined in each use case. Pictet has been using chatbot technology internally, to modernize communication between the front office and compliance. This is a functionality that is also built behind the scenes of the JB DIAS system too.
[1] Agenda BAICC – EE – Seminar Robotics in FS – Agenda f (master). http://www.baicc.news/a-propos-baicc/
[2] JB separated in 2009 from its asset management business.
[3] Neurprofiler is a MiFIDII-compliant customer risk profiler for Financial Advisors.
[4] Salivating for Unadvised assets: a videographic, Nov. 2015
[5] https://www.techradar.com/news/support-agents-versus-conversational-chatbots
Book one hour with Efi – Ask me anything (AMA) for 0.10BTC – [email protected]
Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.
I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post.
Subscribe by email to join the 25,000 other Fintech leaders who read our research daily to stay ahead of the curve. Check out our advisory services (how we pay for this free original research).
Spring has brought lots of action even in the commoditized robo-advisory segment.
Three picks capture the flavor of the day in US robo-advisory.
Ellevest is in its 4th year and remains focused on empowering women. The offering includes a significant educational and coaching service for business women. What became clear from this recent funding round, is that the only viable part of the business is actually the HNW part. Ellevest Private Wealth Management is the premium service targeting HNW females and most of the capital raised will go into growing this business. This makes me believe that Ellevest doesn’t actually belong to the robo-advisory category but to the `Financial Wellness for Women in Business` category.
Betterment, on the other hand, has gone hybrid in two ways. Both in terms of offering a 100% DIY asset allocation service and with an advisor lite possibility; and having a B2C business parallel to a B2B business for financial advisors and for corporates (e.g. Uber). Financial advisors using the Betterment platform didn’t have an account minimum anyway. Now Betterment drops the 100k account minimum for individuals that want a customized portfolio allocation through the Betterment Flexible Portfolios offering. Their Premium service for 40bps now has no minimum. Betterment`s move comes in response to demand from existing retail clients to be able to customize their exposure in certain asset classes. The business decision of offering this flexibility at no cost, confirms that Customer is King and will remain so forever and ever.
Charles Schwab subscription service rhymes with Apple`s news service. For $30 a month, Schwab offers a financial planning package. Schwab Intelligent Portfolios Premium (rebranded name) is offered at $30 a month after a one-time $300 fee with a $25k minimum. Asset allocation is from a universe of 50+ ETFs, including a financial plan with a customized roadmap and unlimited one-to-one guidance from a CFP professional. Regulated financial-investment advice at $630 for the 1st year and $360 annually thereafter.
Schwab Intelligent Advisory (the original robo name) was at 28bps per annum 0.28% of assets.
Think of the 300,000 Schwab Intelligent Advisory accounts ($37 billion). Some will remain in the free, no-advisory offering. But a significant part will switch over to Schwab Intelligent Portfolios Premium and get advice. Evidently, any account with enough assets ($125k seems to be the magic number) will switch over.
What will this move do to the rest of the large players? When will Vanguard follow suit?
This is another discount brokerage moment in the investment industry. This is the subscription financial advice retail moment. Michael Kitces, the cofounder of XY planning Network XYPN, has deployed a successful subscription-based business for financial advisors, thus proving that it works at the B2B level. Now Schwab is pushing for a B2C implementation.
[1] Rethink Impact, PSP Growth, the Melinda Gates’s investment fund Pivotal Ventures; PayPal; Wynn Resorts co-founder Elaine Wynn; former Google and Alphabet chairman Eric Schmidt; former top aide to President Obama, Valerie Jarrett; and Mastercard. Source.
Sources: Schwab on Bloomberg; Betterment on FP; Schwab on ThinkAdvisor.
Book one hour with Efi – Ask me anything (AMA) for 0.10BTC – [email protected]
Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.
I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post.
Subscribe by email to join the 25,000 other Fintech leaders who read our research daily to stay ahead of the curve. Check out our advisory services (how we pay for this free original research).
Call it a hidden bias, or coincidence, the fact is that I have mentioned Moo.la the UK `robo` in three posts over the past 3 years. Gemma Godfrey, CEO and founder, is an ex-Goldman Sachs personality who was in the City A.M.’s Power 100 list the 2017 and was also chosen to join Arnold Schwarzenegger advisory on The Celebrity Apprentice (alongside Jessica Alba, Warren Buffett and YouTube celebrity Justine “iJustine” Ezarik).
In early 2016 as I was searching for robo-advisor actual performance, I spotted Moo.la as one of the promising female-led robo advisors along with Sallie Krawcheck`s Ellevest. Call this another bias? Maybe, since Sallie and Gemma are both ex-Wall Street female leaders with significant investment experience. See here.
In late 2016. Moo.la was already included in the Top50 European Fintechs.
In Feb 2018, I included Gemma in my monthly `Women and Fintech – The Feb. playlist of 10` for a very explicit reason. Gemma’s venture was addressing the savings crisis problem in the UK. Her message was loud and clear and based on her belief that the domination of men in finance is a problem that can only be solved by us women becoming raw models for others.
In Spring 2018, Moo.la came across my path again as I met Paul McNamara, the CEO of Evalue, the sophisticated UK financial planning and advice software company. I could not resist sharing on DailyFintech Paul`s excitement on the launch of their API platform and their participation in the 2nd cohort of the FCA with a focus on regulated advice.
Moo.la was one of the Fintech partnership examples with Evalue that I reported. While Moo.la is a savings platform and one that caters to all those that are intimidated from the investment lingo and the confusing product choices; they wanted to offer their clients realistic, visual scenarios for the inexperienced to become comfortable with their investment choices. Evalue offered a piece of mind to Moo.la that behind the scenes, the scenario analysis was as sophisticated as it can get.
On the other hand, Gemma had made a business choice to offer a limited menu of investment choices. Three kinds of investment plans and one additional pure ethical portfolio. There is no `luxury` of customization and the focus is on offering comfort for the pre-designed investment choices. The philosophy behind this, is to focus on the customer experience which is mostly driven by emotional comfort or discomfort (leading to panic when least needed).
Four investment options that are well understood will work wonders for customers versus 44 investment options that are not well understood.
As Moo.la is not an investment advisor, Evalue`s software also makes sure that all is fully compliant. The limited menu also allows Moo.la to keep costs low. Savor Moo.la`s knowledge center with insights and education for all levels in a language that is natural.
Last summer, Moo.la was acquired by JLT Employee Benefits (JLT), one of the UK’s leading employee benefits providers. This acquisition should not be seen as a just another Fintech M&A transaction. It is actually a purposeful strategic ecosystem move, whose success should be measured beyond the dry numbers. First and foremost, Moo.la becomes part of a business (and running also standalone) that is in complete alignment with their philosophy. JLT’s strategy is focused on helping UK businesses deliver better performance through the improved financial, emotional and physical wellness of its people.
This acquisition is at the service of Goal-based investing.
Moo.la will also be integrated in JLT`s Benpal platform. Fintech from an angle of employee benefits in all industries is a great example of sustainable innovation. Robo services that are not just about the low cost but predominately about retentions, engagement and well being of the employees. BENPAL is an evolving next generation rewards and benefits platform that JLT offers its corporate clients. It is designed to help attract, retain, engage and reward the workforce. It allows employers to manage employee reward and benefit program in a digitalized era.
Last week Moo.la won the City of London’s ‘Best Goal-Based Investing Service’. We are already designing the world we have been dreaming of; slowly and steadily. An investment world that is not only about the monthly reports of our investments but also about our progress towards our goals
In this spirit:
Book one hour with Efi – Ask me anything (AMA) for 0.10BTC – [email protected]
Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer.
I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post.
