Wealthfront and Personal Capital were acquired by financial services firms in billion-dollar deals. Not bad exits, but far from the loftiest fintech dreams.
The robo-advisors were right about a lot: there is a new generation of investors that was being underserved by the incumbents and looking for a digital-first approach to help them with core investment and financial planning. And among robo-advisors, Wealthfront, Betterment and Personal Capital are notable for achieving real scale, not easy to do — Wealthfront has roughly $27 billion in assets under management.
Wall Street banks, without even trying, are sitting on big assets in the digital investing space. Speaking about its You Invest platform,CEO Jamie Dimon noted on its recent earnings calls,"Self-directed investing has $55 billion. I think, Robinhood has, I think, $80 billion the last time I saw or something like that. We're not sitting here bragging about our product because, I would tell you, it's not good enough yet.
"Customer acquisition costs have been the thorn in the side of robos since day one," Goldstone said."In the early days, they grossly underestimated how much it would cost." "UBS probably bought Wealthfront much more for the customers than the tech," Wong said."To expand into this emerging high-net-worth market. Wealthfront has it."
"My best guess is they were probably gunning for an IPO early on, to stay independent and exit through an IPO, but it's very difficult to compete with Vanguard. They were the largest robo-advisor in the market within a few years," Goldstone said."Getting their brand out there, finding new clients and achieving scale, all of it is difficult ... all of it has been difficult for robo-advisors from the beginning.
Australia Latest News, Australia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Indonesia’s Financial Regulator: Local Firms Are Not Allowed to Offer Crypto Services (Report)The Financial Services Authority warned about the risks related to digital assets and banned local companies from offering crypto opportunities.
Read more »
America’s Oldest Fast-Food Chain Is Canceling This Beloved Tradition — Eat This Not ThatThe burger slinger won't be hosting its long-running 'fine dining' experience—but you can still nab a great takeout deal.
Read more »
The #1 Best Drink for Your Heart, Says Dietitian — Eat This Not ThatYour heart health is important, which means the foods and drinks you consume are too. Here's the best drink to help protect your heart.
Read more »
15 Secrets Five Guys Doesn’t Want You to Know — Eat This Not ThatBefore you enjoy your beautiful juicy burger, there are some secrets about Five Guys you should know before ordering.
Read more »
Dangerous Foods You Could Be Eating Right Now — Eat This Not ThatIt's not just obviously unhealthy foods that could do you harms—there are plenty of secretly dangerous foods in your diet, nutritionists say.
Read more »
COVID-19 vaccines do not affect fertility for women or men, study findsA new study adds to the growing evidence that COVID-19 vaccines are safe for both pregnant people and people hoping to become pregnant. Read more:
Read more »