Wealth Management: Looking into the Industry’s Future

Vasyl Soloshchuk

WealthTech Future

In this article we continue to explore the changing landscape of wealth management by gathering the opinions of industry influencers regarding the future of the WealthTech sector. What will the industry look like in the near future, and what do companies plan to do to embrace the change? Let’s jump right in.

Accelerated automation

Trizic sees the future of wealth management to lie in global automation. Drew Sievers, CEO, wants to take his company to the front line of players who will harness the potential of technology to transform the industry.

TrizicCredit unions, as well as community banks, is another area of interest for Trizic, since these have been a terra incognita to date, which few have tackled. This sector represents trillions of dollars once unlocked, so it’s a great opportunity for WealthTech layers to broaden their horizons. As Drew says, “They’re the most emerging area.”

Trizic sees plenty of room for improvement in this area. Credit unions usually experience three major problems: regulation, declining sales, and rising costs:

“My revenue is going down, because my fees are being compressed. My operating costs are going up because I have all this software and people and every time I add a piece of software I have to hire someone or get more software.”

Artificial intelligence and algorithm-based portfolio management

Companies in WealthTech have come up with variety of use cases for artificial intelligence (AI) and added more edge to their offerings. Hedgeable, for example, employs a unique portfolio-customization approach using a proprietary data science engine that relies on more than 1,000 decision parameters when allocating funds. Furthermore, the company has an intelligent rebalancing tool that helps busy professionals save time and watch their portfolio become optimized via an automated investment solution. Additional modern platform features allow clients to see beyond traditional investing options and grow their wealth by, for instance, putting money into bitcoin. The company’s CTO and head of the AI lab, Sid Sharma, believes that Hedgeable was one of the first in WealthTech to broadly use AI. Today, AI is helping the company to streamline the user experience, innovate investing strategies, and excel on the predictive analytics front.

GinmonGerman company Ginmon has its own way of managing portfolios. The company is promising larger gains as a benefit of using smart technology. Its in-house algorithm Apeiron creates a portfolio of ETFs based on specific needs customers mention in an initial survey. The tool provides an effortless way to meet investors’ financial goals. Apeiron has several variations that offer greater flexibility to clients looking for a diverse pool of investment solutions:

  • ApeironSelect constantly monitors emerging index funds and ETFs to add more investing options to the overall portfolio;
  • ApeironProtect helps maintain an optimum investment structure to deal with market fluctuations;
  • ApeironEnhance looks for room to improve the portfolio beyond the standard tools.

AlgoLead’s CEO, Boris Khazin, sees tremendous potential in AI and believes we are heading into an “algorithmic future.”

AlgoLead“The future is in more algorithmic computer decisions, in more blockchain, instantaneous communications, and onboarding.”

Boris is confident that the need to interact with a human advisor will drop, since machines will be able to accomplish the majority of tasks that were previously performed by real customer service representatives.

Trust above everything

Seeing lack of trust as the root of all evil, Andrei Cherny, CEO of Aspiration, along with his team, are determined to change the current situation. Aspiration is planning to keep on “unlocking the true value” of financial products with its “pay what you want” model, making trust the first priority of the business. Harnessing lessons learned, Andrei thinks that the vision should go beyond what potential customers can imagine at the moment.

AspirationThe goal of FinTech players is to foresee which advancements will help their clients better deal with personal financial planning. This is why service providers should be a step ahead of their audience. As Andrei says:

“It’s also important to build the products that maybe clients haven’t even imagined yet. And not just listen to what they’re looking for but solve the problems they don’t even know they have.”

Aspiration relies on social media to engage with its customers. Most of its conversions come from such platforms, and Andrei believes that this low-cost engagement tool will be essential for future communication with the company’s growing clientele: “Social media has really been the biggest driver of our customer growth.”

Moreover, Andrei predicts an increase in conscious spending and a focus on ethics in the near future. Aspiration is known for its sustainable investment offerings, and the overall trend only proves the company is on the right track:

“Aspiration is a driver of democratizing sustainable investing and opening the doors to sustainable banking and spending.”

Aspiration’s philosophy is to help investors make sustainable choices in the future with the global impact in mind. Thus, the ideology for the next decade is unlikely to change and will be about making money while doing good for the environment.

Open US market for all

During our chat with DriveWealth’s executives, we heard that the main focus of the firm is on international markets. Its long-term strategy is to open the US market to anyone in the world, being it India, South Africa, etc. Bob Cortright, CEO of DriveWealth, sees the company’s mission to lie in creating unique and sophisticated retail wealth management products that can be delivered to any local retail client base through reliable global partnerships:

DriveWealth“We build infrastructure to support all different types of wealth management products that can be distributed to the retail segment around the world.”

Another aspect the company sees as essential is investing in units of stocks. Harry Temkin, the company’s CIO, says that DriveWealth enables painless fractional investing while others still charge the same commission for a slice of a share:

“We trade securities down to a ten-thousandth of a fraction, and this allows our partners to build very granular portfolios and really to reduce the barriers to entry.”

Harry also mentions legacy technology as a likely block for many of DriveWealth’s competitors in the future. Unlike many market players, DriveWealth uses the latest technology, which will be another feather in its cap in the long run as the systems and the solutions get more complex:

“That’s one of the luxuries that we’ve had of building the technology from the ground floor and not having any legacy systems.”

Bob Cortright adds that CX is going to get much better. Not only cost disruption, but also a strong business model will be the main contributors to this significant improvement:

“The industry is going to continue to evolve very rapidly in terms of more sophisticated products within the same wrapper at the same cost.”

Regulations will add more edge to competition

Martin Polasek, CTO of Swiss company Evolute, predicts that regulatory pressure will reshape investing. With more requirements for transparency and clarity, industry payers will utilize modern technology to comply with newly adopted standards:

Evolute“MiFid II is putting the end investor [customer] first. And this might create opportunities to review the current business model and to possibly accelerate the innovation.”

Martin is confident that clients will seek more collaborative work when placing their wealth in the hands of a wealth manager, so hybrid advice will be a widely preferred model.

“What I see is that this generation is increasingly hesitant to delegate all the investment decisions to an adviser and is increasingly seeking models where the wealth manager and the client work together.”

Evolute’s executive also mentioned that artificial intelligence will play a major role in wealth advisory. He is positive that robo will gradually replace conventional advice models:

“I think that [the shift to robo] will happen. But it will really slowly creep up from the retail client segment up to the less affluent, more affluent, and so on. It will probably never reach the ultra high net worth base.”

Since banks usually have large budgets and very limited resources for IT innovation, Evolute is also planning to help financial institutions with a smooth transition to the digital mode:

“Newer companies with top-notch delivery methodologies can really help these established players switch to the digital world.”

Effective change management will be key

As a priority for the coming year, Greg Vigrass, CEO of Folio Investing, sees the company as having a duty to help clients manage change during the most rapid development period in the history of financial services:

Folio Institutional“A challenge is working with people to help them understand where natural integration points are, how certain things affect their business, and helping them understand what they really should be spending their mental energy on.”

With emphasis on the security of its solutions, Borys Harmaty, CIO of Folio Investing, says that keeping resources up to date with innovative technology is another part of the company’s long-term strategy.

“For example, machine learning is a whole new area and having all of these data related to that is a question of helping everybody’s knowledge and capabilities in the firm. It’s more getting people up to speed.”

Omni-channel business model for scalability

Sid Sharma wants to scale his business to offer quality products to as many people as possible. The CEO of Hedgeable plans to utilize multiple channels to achieve these goals:

Hedgeable“Whether it be through our consumer website, or our partners to whom we license our platform, we just want as many people as possible to have a great investment product in their hands.”

Sid thinks it would be unfortunate to see another financial crisis similar to the 2008 collapse, so he, along with his team, is aiming to secure a bright future for clients by offering exceptional products to the masses.

Custom-tailored offerings will become even more targeted

Invessence’s team believes that every customer will go for the products that most closely resemble their own strategies and thoughts. InvessenceThus, specific investment and wealth-management plans will be introduced, and the advisor will move from generic management to a more targeted allocation depending on the needs of each customer. As Jigar Vyas, Invessence CEO, says:

“I do see the role of advisors changing to a more targeted approach, where somebody needs something specific and they help them with that, rather than it being purely about asset management.”

MyVestAnton Honikman, CEO of MyVest,  has a similar opinion, predicting a systematic shift from a  product- to a customer-centric approach in wealth management. Since the offerings of MyVest are already very custom-tailored, Anton sees the goal for his company in the near future to be keeping up with fast-paced technological advancements:

“Our challenge is to make our value-add and value-prop digestible and accessible in an ever-changing technological landscape.”

Intelligent customer management as standard

Bryan Sachdeva, from Canadian company NexJ, believes in the advancement of cognitive services that some players will utilize to offer exceptional investment solutions.

NexJ“I think we’re going to see more artificial intelligence and cognitive services, but from a whole host of different providers.”

NexJ is striving to offer an “intelligent customer-management approach,” with as much flexibility as possible and without narrowing down the options to just one preferred technology.

Wealth management might split into specifics

Bertrand Rassat of TradingScreen is certain that before long wealth management will undergo a major change, with two possible outcomes:

TradingScreen“One is that the banks will remain and will be developing activities that blend asset management, brokerage, and wealth management. The second is that we will see the emergence of niche players that will concentrate on one specific area of wealth management.”

Within these specific areas, Bertrand foresees wealth management firms outsourcing some of their core operations to third parties and focusing on particular categories of clients—e.g., high net worth individuals—that require a certain level of service. In such a way, wealth-management boutiques will differ in terms of exclusive services, offering a “degree of luxury” in addition to a robo segment:

“You want to be offered robo-advisory services like the man on the street, but you also want to have someone coming to your offices, talking to you, giving you specific advice, understanding where you come from, your family situation and your specific needs and requirements.”


As we can see, the industry is likely to face major changes in the next few years. With the rise of innovative technology and the demand for highly personalized offerings at reasonable cost, as well as the growing popularity of fractional investing, market players will have to move quickly to keep pace and grab their slice of the pie.