A new generation of fintech companies is building digital solutions to transform the investment and asset management industry. Often referred to as “wealthtech” companies, these use artificial intelligence (AI) and big data to offer advice, and provide low-cost alternatives with micro-investment platforms and trading solutions based on social networks.
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Wealthtech reached a record of 74 financing agreements worth US$657 million in 2016 and has been growing steadily for the past five years, according to data from CB Insights. And while robo-advisors (automated services that use machine-learning algorithms to offer personalized users advice) are by far the best-known product in the field, there are many new ideas emerging that seek to improve the investment industry through technology.
Robo-retirements, for instance, are robo-advisors that specialize in managing retirement savings. Micro-investment platforms make it possible to invest small amounts of money with no commission and are particularly appealing to Millennials. Digital brokers include online platforms and software tools that put stock market information and investing within anyone’s reach. Portfolio management tools are developed to help investors and financial advisors to unify and manage their investment portfolios in a single platform.
As one of the world’s most dynamic hubs dedicated to wealth management, Switzerland is positioning itself as a forerunner in the emerging wealthtech subsector.
Swiss banks on the forefront
The US was the fastest in adopting wealthtech products, far ahead of Europe. The country now has the greatest concentration of wealthtech companies.
At an event in 2016, Felix Niederer, the founder and head of Swiss robo-advisor startup True Wealth, warned of the risks of Switzerland’s inactivity in the face of rising American wealthtech startups. “If we do nothing, it won’t be long before American providers step in,” Niedgerer said.
For Ivan Buchi, former leader of the digital office at Glarner Kantonalbank, the rise of wealthtech is inevitable. “In five years robo-advisors will be indispensable. It will hardly be possible for a client advisor to look after his or her clients without them,” Buchi said.
Banks in Switzerland have already begun deploying solutions to respond to the increasing demand for digital, tech-enabled wealth products.
UBS has launched its Smartwealth robo advisor in the UK. Similarly, at Credit Suisse, digital development is gathering pace under the guidance of Anke Bridge. Credit Suisse plans to launch a new service based on advice provided by robots.
In October, ELVIA e-invest, a unit of Allianz Suisse, became the first Swiss insurer to launch its own robo-advisor. ELVIA e-invest developed the solution with Additiv, a Zurich-based wealthtech startup,
Swiss wealthtech startups gain international recognition
Since True Wealth founded the first robo-advisor startup in Switzerland back in 2013, several others have emerged with a few already gaining international recognition.
Meetinvest, a company founded in 2014 by husband and wife Michel and Maria Jacquemai, combines a social media platform with an investor toolkit to create a platform with all the necessary resources for people to start trading like pros. Meetinvest made its US debut at FinovateSpring 2016, a fintech show in San Jose, California.
Another key player in Switzerland is InvestGlass, a white-labeled, client and prospect management platform for bankers, wealth managers and advisors. The platform is designed to facilitate prospecting and onboarding of new clients, as well as the management relationships with existing clients.
The International Money-Tech Event, taking place on November 15, 2017 at the SIX Convention Point Zurich, will discuss some of the hottest trends in the wealthtech space including robo-advisors, crypto finance, digital currencies, and more. Participants will hear from leaders in the space representing the likes of Lykke Exchange, Bankable, TransferWise, Swisscom, F10, and more.
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