Richard Theo of Wealthify
Wealthify is turning wealth management on its head with its innovative online investment service after raising £3m in funding. Bryce Wilcock reports…
Cardiff fintech firm Wealthify has fast established itself as a major player in the rapidly growing ‘robo-investing’ sector since its official launch last year.
Conceived as a low-cost alternative to traditional investing, the company has developed an online investment service open to anyone who wants to start investing.
It allows budding investors, regardless of income or experience, from 30-somethings working in the city, to baby boomers looking to boost their retirement funds, get into investing.
“People don’t need any previous investing experience at all, because our experts build them an investment plan and manage it on their behalf,” co-founder Richard Theo told BQ.
“Sign up is fully online and takes less than 10 minutes. Customers just decide how much they want to invest and how long for, using our intuitive sliders, then pick an investment style, from ‘Cautious’ to ‘Adventurous.’ They can start with as little as £1 and add more monthly if they like.”
Wealthify was established when CIO, Michelle Pearce, a former wealth manager, realised traditional services were inefficient and clunky, and that customers were paying high fees for a poor-value service.
Pearce teamed up with Theo, a serial technology entrepreneur and founder of successful comparison business, ActiveQuote, and set about developing a platform to tackle the problem. This led to the launch of Wealthify.
But, despite Pearce’s experience in the wealth sector and Theo’s track-record of building successful tech businesses, the launch of Wealthify, like any start-up, didn’t come without it’s challenges.
Theo recalls: “The main challenge was to create a service that is completely customer-centric and a platform that is simple, intuitive and jargon-free, with no complicated statistical graphs that customers can’t fathom.
“To achieve this, we made a virtue out of simplicity in everything from the way we describe and explain concepts like risk and diversification. We started with a completely blank canvas.
“We didn’t want Wealthify to look or sound like any other financial services website we’d ever seen, so the first thing we did was ban stock photography and clichés.”
This approach to simplifying the investment process is what has helped Wealthify’s multi-award-winning platform differentiate itself from other wealth management providers and really stand out from the crowd.
Since the company was established in late 2014, the business has grown from a concept to a team of 13 talented people with a shared ambition to shake up the investing world and democratise investing.
Theo says: “We officially launched the platform in April 2016 and have already surpassed targets for invested customers, with almost 6,000 users now signed up.
“We’ve also raised £3m in funding, including £1.4m through a crowdfunding round in 2016 that attracted over 760 shareholders.
“In our first year, we delivered benchmark-beating returns for customers. Our plans returned 28.50% (Adventurous) 22.25% (Ambitious),18.28% (Confident), 11.86% (Tentative) and 8.86% (Cautious), beating the average returns of major UK providers like Barclays and JP Morgan.
“Most importantly, our customers say they love the service, scoring us an average 4.42 out of 5 from 125 reviews on reviews.co.uk. Our app for iOS and Android is regularly used by over half of our customers and highly rated on both platforms.
“As well as praise from customers, we’ve received industry recognition, including two UK Digital Experience Awards, a ‘Highly Commended’ at the UK Platform Awards, and a silver Best Buy from Boring Money.”
The success of their crowdfunding campaign in particular helped the pair realise just how much demand there was for their service and how people would react to the offering once the market place was established.
Theo says: “We believe that the level of support seen during the crowdfunding campaign reflects the public’s recognition of the need for new ways for consumers and every day savers to grow their money.
“We believe investing will play an increasingly important and central role in more people’s long-term financial planning in future. Our support also shows the level of public confidence in our mission and business model, even at this early stage in our development.”
And building on this demand, Theo and Pearce are also keen to continue investing in Cardiff, a city they believe has huge potential for tech firms such as Wealthify.
“Wales is a great place for business and the decision to locate in Cardiff was definitely strategic,” he added. “Cardiff has become a centre of excellence for financial services which helps businesses like ActiveQuote and Wealthify stand alongside national brands like Admiral Insurance and Lloyds Banking Group.
“Wales also provides a rich pool of talent, in both financial services and customer service disciplines. Wales’s workforce is impressive for their dedication and hard work – there’s a real, inate passion for providing good service.
“Paired with lower operating costs compared to other major UK cities, it’s an obvious choice for a new business. There’s a great excitement around Cardiff as a city that’s growing and more than punching its weight as a business hub.
“It’s a fantastic city in terms of ammenities, lifestyle and has a superb infrastructure connecting us with London – the UK’s financial hub – in under two hours.
“The supportive and creative environment the Welsh Government has created for small businesses in the area has also been of enormous benefit to us and we feel excited and proud to be supporting Welsh Government’s aim for Cardiff to become one of the largest FinTech hubs outside of London.”
So, what next for the company? Theo concluded: “Wealthify is now a leading player in the emerging ‘robo-investing’ sector, offering online wealth management services at a fraction of the cost of traditional players. Citi Bank predict the market could be worth around US$5trn by 2020.
“But as well as disrupting wealth management, we’re targeting non-traditional investors and the £700bn held in UK cash savings, by encouraging savers to try investing.
“A combination of low interest rates and rising inflation has made cash saving all but obsolete, so the need for a sustainable alternative for savers is clear.
“We’re the only player in this space with a truly mass-market proposition, and we’re confident we can turn 1 million savers into investors in 10 years.”
Our BQ Bulletin emails will land in your inbox at 7.30am, Monday to Friday, with a mix of the latest local business news, national news, and features to inspire you. Sign up here!
Click here to read our privacy statement