StashAway: Investing and wealth management in the new normal
Nino Ulsamer, Co-Founder and CTO, expounds StashAway’s new approach to investment based on customer-centricity, data and automation
Alternative Investments
October 12, 2022
March 10, 2021
17 min readJanuary 30, 2020
The Wealthtech Finfluencers featuring @OdysseusPartner @Minh_Q_TRAN
Week 6: The Wealthtech Finfluencers
When we talk about the many different subsectors of fintech, wealthtech may not be the first that comes to mind. But it’s one of the areas that is constantly evolving, innovating, and changing the way both advisors and their clients approach money management.
And wealthtech is so much more than just robo-advisors. As bleeding-edge AI and data analytics tools provide greater levels of insight, UI and UX interfaces continue to evolve, and improvements to back-office technology help RIAs work smarter, innovation is constantly happening in the space.
That said, we’d like to recognize some of the top “finfluencers” in wealthtech.
April Rudin -- Twitter, LinkedIn
Founder and CEO of The Rudin Group
LinkedIn location: Greater New York City Area
Twitter bio: Global #wealth #finserv #marketing firm| #Messaging #Content #Digital +more| #1 wealth management influencer | Likes: #NextGen #FinTech #WealthTech #Detroit
Bill Sullivan -- Twitter, LinkedIn
President of Family Office Exchange
LinkedIn location: Richmond, Virginia Area
Twitter bio: President Family Office Exchange (@FOXExchange) #FamilyOffice #Wealth #Fintech #Banking #OpenBanking #OpenX #RisingGen insights. @Capgemini alum Avid golfer
Chris Gledhill -- Twitter, LinkedIn
Independent FinTech Advisor, Futurist, Writer & Speaker
LinkedIn location: London, United Kingdom
Twitter bio: #FinTech Influencer, Keynote & TEDx Speaker, Writer and Advisor. #FinServ #InsurTech #WealthTech #PayTech [email protected]
Christian Ross -- Twitter, LinkedIn
Manager Business Development at Blanco Fintech
LinkedIn location: Amsterdam Area, Netherlands
Twitter bio: Business Development at @Blanco_fintech #wealthmanagement #wealthtech #regtech #fintech
Devie Mohan -- Twitter, LinkedIn
Co-Founder and CEO of Burnmark
LinkedIn location: London, United Kingdom
Twitter bio: I don't know everything, but I can try. Global top 10 fintech influencer, writer, speaker. Founder @burnmark_ Member @thinkforward
Helene Li -- Twitter, LinkedIn
General Manager of the FinTech Association of Hong Kong
LinkedIn location: Hong Kong
Twitter bio: Purpose is the new profit 🎯🔝2🏆#Influencer on #Sustainability #fintech Co-Founder GoImpact @jpmorgan @bnpparibas alum & best role of all: Mom (views my own)
JP Nicols -- Twitter, LinkedIn
Co-Founder of Fintech Forge
LinkedIn location: Seattle, Washington
Twitter bio: #FinTech #FinServ advisor/writer/speaker: @FinTechForge | @BreakingBanks1 | @ProvokeCast | Innovation+Strategy+Leadership (+ a little soccer #EBFG)
Koen Vanderhoydonk -- Twitter, LinkedIn
CEO Belgium Luxembourg Germany at Blanco Services
LinkedIn location: Brussels, Brussels Capital Region, Belgium
Twitter bio: CEO BeLux @Blanco_fintech passionate about the future of banking, public speaker #Fintech #RegTech #WealthTech #entrepreneur Let's connect!
Minh Q Tran -- Twitter, LinkedIn
Managing Partner at Odysseus Partners
LinkedIn location: Paris 13, Île-de-France, France
Twitter bio: #AssetBuilder & #VC-as-a-Service on #Alternative #Assets in #Insurtech #Wealthtech #Proptech #Impact #Fintech. Top online influencer in insurtech
Rodrigo Garcia de la Cruz -- Twitter, LinkedIn
CEO and Founder of Finnovating
LinkedIn location: Madrid Area, Spain
Twitter bio: CEO @FinnovatingHub | President @asocfintechins | VP @FintechIberoAme | CoFounder @Accurate_Quant | #FinTech #InsurTech #PropTech #RegTech #WealthTech
Susanne Chishti -- Twitter, LinkedIn
Chief Executive Officer at FINTECH Circle
LinkedIn location: London, United Kingdom
Twitter bio: CEO @FINTECHcircle @FTC_Institute Bestselling Editor: @WealthTECHBook @InsurTECH_Book @TheFINTECHBook #AI #Fintech Champion of the Year 2019 #womeninfinance
Urs Bolt -- Twitter, LinkedIn
Partner at Blockchain Innovation Group AG
LinkedIn location: Zürich Area, Switzerland
Twitter bio: Expert Advisor, PMP® | #WealthManagement #WealthTech #DigitalAssets #Ecosystems | @BIG_Blockchain | Mentor @F10_Accelerator | @Phonak Ambassador
ODYSSEUS PARTNERS' WEALTHTECH MAP
See more here: https://www.odysseuspartners.com/news/odysseus-is-proud-to-present-its-2020-european-wealthtech-map
December 24, 2019
#Alternative #Funds: What you need to know
Want to go beyond stocks, bonds and cash? Alternative investments can include everything from real estate to fine art. If you’re looking for another way to diversify your portfolio, alternative investments may be worth considering. Read on to discover if alternative investments make sense for your portfolio.
What is an Alternative Investment?
Alternative investments are assets that fall outside the traditional investment categories. Traditional investments include stocks, bonds, mutual funds or exchange-traded funds (ETFs). Alternative investments include venture capital or private equity, commodities, derivatives, currencies, structured settlements, managed futures, real estate, hedge funds and real assets such as art and antiques.
The reasons for moving into alternative investments include a need to diversify a portfolio, specific tax incentives or an unusual opportunity to take advantage of a deeply discounted asset.
Typically, alternative investments have no correlation to conventional investments. This can make them difficult to value. They are also illiquid in comparison to traditional assets. For instance, it may be more of a challenge to sell a piece of art than 500 shares of Amazon. It’s also difficult to actually value these assets since there are many considerations when determining each individual asset’s value.
Usually, institutional investors or accredited investors with a high net worth hold alternative investments because of their complexities, level of risk and deficiency of regulation. Recently, these investments have grown in popularity because institutional investors, which include pension and endowment funds, are increasing their investments in alternative options. They are doing so due to the potential long-term perks of this asset class.
It’s important to note that many alternative investments have high minimums and fee structures in comparison to mutual funds or ETFs. They also have fewer published performance data. While alternative investments have high fees and high minimums they tend to have lower transactional costs. This is because there is less turnover for investment.
Types of Alternative Investments
Now that you have a basic understanding of what alternative investments may offer your portfolio, here are a few you may want to become more familiar with.
Private Equity
Private equity composition consists of funds or investors that invest in private companies. These companies include start-ups and venture capital and help with financing through the growth of an organization. These investments can encompass a broad array of private equity markets. Private equity firms will typically raise funds from institutional and non-institutional investors, which they can then use to invest in a specific investment strategy or private firm.
Investors profit when an exit event occurs, such as an IPO or acquisition. They will receive the amount left over after the private equity firm takes their management and performance fees.
Venture Capital
Venture capital is a subset of private equity that specializes in investing in the early, or growth phase, of a company. A firm will raise funds from high net worth or institutional investors to then invest in companies that are at different funding stages. Venture capital is extremely important to start-ups and companies in their early funding stages because they have no revenue or little to no operational history.
Funding this type of investment can be a risky endeavor but it can yield high returns: Investors who put money into Google, Facebook and Twitter have enjoyed exceptional returns.
Start-up and private firm investing
Instead of investing in private equity firms, investors can invest directly in start-ups or private firms. This type of investing is sometimes referred to as angel investing. Angel investing is a high-risk, high-reward investment strategy since not all start-ups succeed.
If a private company needs some form of direct investment it will seek investors through private placement. This placement can proceed only if the investment meets certain criteria. Retail investors can also participate depending on the type of registration exclusion the firm relies on.
Hedge Funds
A hedge fund is an investment partnership that pools assets from all investors involved. Hedge fund managers raise capital to invest in different financial instruments and strategies. Hedge funds are different from private equity and venture capital investments because they tend to invest in public equities, which means investors can distribute their funds more often.
Tangible assets
Tangible or real assets hold inherent value. These assets can include oil, precious metals, commodities and land. Tangible assets also include collectible items such as art, antiques, baseball cards, wine, jewelry and rare coins — even water. Investors can either purchase real assets directly or they can invest in funds such as SPDR Gold Trust (NYSEMKT:GLD).
Real estate
Real estate investment trusts (REITs) enable the retail investor to benefit from the rising value of residential or commercial property. A REIT is a company that either owns income-producing properties or owns the mortgage on those properties. Typically, REITs specialize in a certain type of property, although you can also find hybrid trusts that offer a mix of investments. The REIT sells shares to investors, which you can purchase directly from the company or through an exchange-traded fund (ETF) or mutual fund.
Additional Considerations
Due to the lack of regulation of alternative investments, some investments are prone to scams and fraud. In comparison to traditional investments, alternative investments have fewer legal boundaries and structure.
While most alternative investments fall under the Dodd- Frank Wall Stress Reform and Consume Protection Act, they usually don’t have to register with the Securities and Exchange Commission (SEC). However, they are subject to examination by the SEC. Yet, they are not overseen or regulated the way mutual funds and ETFs are. Therefore, it’s imperative that investors do their due diligence when considering alternative investments.
Another consideration is that these investments have low correlation to stocks, bonds, mutual funds or other conventional investments. This means that these investments move counter to or in the opposite way of conventional securities. That feature makes them suitable for increasing your diversification within a portfolio. Tangible assets such as precious metals, oil or real estate also help the investor hedge against inflation.
How to Invest In Alternative Investments
While many alternative investments are often limited to accredited investors, institutional investors or those with high net worth, there are also options for non-accredited investors. Alternative mutual funds or ETFs are available for individual investors. Since most alternative investments are costly and difficult to invest in, these funds provide access to alternative investment categories for average investors.
Since they are publicly traded, there is a requirement for registration with the SEC and they’re regulated by the Investment Company Act of 1940. If you’re interested in investing in alternative investments, speak with your financial advisor to discover all of the options available.
The Bottom Line
For the most part, alternative investments appeal to serious and accredited investors. They often require a lot of money upfront and can carry substantial risks. Alternative investments don’t always pay off, but when they’re successful they can generate large returns much faster than publicly traded stocks.
If you don’t have the capital to invest in alternative investments directly, you may want to consider alternative mutual funds or ETFs. Before investing in an alternative investment, make sure to do your due diligence or even consult with your financial advisor.
Photo credit: ©iStock.com/Murika, ©iStock.com/scanrail, ©iStock.com/nzphotonz
The post Alternative Investments: What Investors Need to Know appeared first on SmartAsset Blog.
November 17, 2018
Venture Capital Is Losing Sight Of Its Most Important Investments: Seed-Stage Entrepreneurs @Forbes
Broad changes in the dynamics of the venture capital are leaving early-stage tech entrepreneurs high and dry when it comes to mentorship and true assistance. With the rise of mega-funds and a massive influx of capital into the tech sector over the past decade, the vast majority of vanguard firms in the VC industry are shifting their focus downstream in pursuit of later-stage, larger dollar investments.
According to the latest research from Crunchbase, late-stage companies are seeing the most VC action today. In Q2 2018, 64 percent of all VC dollars went to late-stage deals, setting new post-Dot Com records for the size and number of venture deals. Meanwhile, the percentage of total VC dollars invested in early-stage deals fell to the lowest levels the industry has seen in five years.
It’s a far cry from the original mission of venture capital – and an ironic one at that. While there’s a huge supply of capital to deploy, it is largely designated for companies that prove their business model and demonstrate traction.
As depicted in the graphic below, the very nature of Series A financing is changing. Venture capitalists used to lead Series A funding (so named to signify a startup’s first institutional financing round) before a company demonstrates traction. The purpose of the financing was to give the startup enough runway to overcome critical early-stage obstacles, such as hiring an initial team, delivering a working version of the product, and landing paying customers. But in today’s environment, mega-fund investors now expect to see these milestones already achieved before they lead a Series A.
November 12, 2018
#Alternative #Funding - Clearbanc raises $70M to give startups ad money for a rev share
Clearbanc offers a fundraising alternative. For fast-growing businesses reliably earning sales from their marketing spend, Clearbanc offers funding from $5,000 to $10 million in exchange for a steady revenue share of their earnings until it’s paid back plus a 6 percent fee. Clearbanc picks what merchants qualify by developing tech that scans their Stripe, Facebook ads, and other accounts to assess financial health and momentum. It’s already doled out $100 million this year.
“As a business successfully scales, we continue to provide them ongoing capital” co-founder and CEO Andrew D’Souza tells me. “Our goal is the be the first and last backer of a successful business and save the entrepreneur from having to take hundreds of pitch meetings to keep their company funded.”
After largely flying under the radar since being found in 2015, now Clearbanc has some big funding news of its own. It’s now raised $70 million from a seed and new Series A round from Emergence Capital, Social Capital, CoVenture, Founders Fund, 8VC, and more with Emergence’s Santi Subotovsky joining the board.
“Venture capital has shifted. Instead of funding true research and development, today 40% of venture capital goes directly to buying Google and Facebook ads” D’Souza claims (that may be true for some ecommerce startups but TechCrunch could not verify that stat for all startups). “Equity is the most expensive way to fund digital ad spend and repeatable growth. So we created something new.”
Clearbanc emerged from an angel investing alliance between two serial entrepreneurs. D’Souza had built Andreessen Horowitz-funded social recruiting site Top Prospect, USV-backed education tech company Top Hat, and Mastercard portfolio biometric authentication wearable startup Nymi. He’d helped raise over $300 million in venture after a stint at McKinsey when he begun co-investing with Michele Romanow, a VC from Canada’s version of the TV show Shark Tank called Dragons’ Den. She’d bootstrapped shopping hub Buytopia that acquired 10 other ecommerce companies, and discount-finder SnapSaves that she sold to Groupon in 2014.
“We started investing together in some of the deals we would see from Dragons’ Den and often found that an equity investment wasn’t the right structure for these consumer product companies. They had great economics and had found a niche of customers, but often didn’t want to exit the business at any point” D’Souza recalls. “They needed money to acquire more customers, scale up their marketing efforts and online ad spend. So we started to do these revenue share deals.”
September 09, 2018
Good news for @OdysseusVenture as ... Luxembourg are new homes for alternative investment funds
SOURCE: https://www.raconteur.net/finance/brexit-alternative-investment-funds
Brexit has been fraught for the alternative investment funds sector, which has assets under management of €5.9 trillion across Europe.
The sector, embracing hedge funds, funds of hedge funds, venture capital, private equity and real estate funds, has suffered a string of setbacks as possible deals that would have given UK firms continued access to the European market have turned to dust.
This included the failure of the UK government to go ahead with ambitious plans for the European Union and UK to “mutually recognise” each other’s regulatory frameworks post-Brexit, which would have enabled UK firms to continue to operate much as they do at present.
Theresa May’s government instead opted for an arguably less satisfactory approach under which EU regulators declare financial rules “equivalent” on an ad-hoc basis.
Alternative investment funds facing a worse Brexit than expected
“The alternative funds and wider asset-management sectors have been operating for at least a year on the assumption that they are going to end up with no access to the European single market post-Brexit,” says Sean Tuffy, head of market and regulatory intelligence for Citi’s Dublin-based custody and fund services business. “The real concern now is it’s going to be a more chaotic break than was previously thought and without any smooth transition period.”
Adam Jacobs-Dean, head of markets regulation at the London-based Alternative Investment Management Association, says banks and insurers are more at risk from a “no deal” Brexit than his members, which include hedge funds and other non-traditional fund managers with more than $2 trillion of assets.
“We’re starting from a base of less overall integration in terms of cross-border provisions in the legislation and a lot of our members already have European structures,” he says.
“If they’re managing UCITS [undertakings for collective investment in transferable securities] products, our member firms typically already have them domiciled in Luxembourg or Ireland, not in the UK. That generally means they already have management entities there as well. That gives them a base on which to build, in terms of potentially moving staff or functions.”
The alternative funds and wider asset-management sectors have been operating for at least a year on the assumption that they are going to end up with no access to the European single market post-Brexit
Fears for the future of ‘delegation’
There’s little sign yet of London-based alternative fund managers making a mass exodus, or even moving significant numbers of staff, to either Dublin or Luxembourg. Mr Jacobs-Dean says most are currently focused on contingency planning and expanding the scope of their regulatory permissions in the relevant EU jurisdiction. This often includes converting their EU arms into “super mancos”, management companies that are dually authorised under AIFMD (EU Alternative Investment Fund Managers’ Directive) and UCITS.
What is really keeping hedge fund managers awake at night is that “delegation” may be about to breathe its last breath. Fears for its future intensified last year after Paris-based regulator the European Securities and Markets Authority declared that asset managers would need to prove they had more than just a “letter box” where their funds are domiciled before being allowed to delegate fund management to non-EU jurisdictions.
“The major risk is that the UK gets to the point of exiting the EU and there are no co-operation agreements in place with the countries that matter the most to us - Ireland and Luxembourg,” says Mr Jacobs-Dean.
However, he says the industry consensus is that “co-operation agreements” will be extended post-Brexit, though the process may be slowed, as it is going to be handled centrally by the European Commission in Brussels, not bilaterally between individual member states and non-EU countries like the UK.
Dublin or Luxembourg are new homes for alternative investment funds
Both the European Fund and Asset Management Association and the UK’s Financial Conduct Authority (FCA) insist that existing delegation rules must remain intact. In April, FCA chief executive Andrew Bailey said: “The truth is that delegation is a well-established global norm [that is] not dependent on EU membership. There is no reason to disrupt a system that clearly works effectively.”
And in March European Securities and Markets Authority chairman Steven Maijoor denied rumours that delegation was for the chop, though he conceded the UK’s desire to quit the single market had “triggered concerns about the risk of regulatory arbitrage between the EU 27 member states seeking to attract business”.
London-based alternative investment funds almost universally favour either Dublin or Luxembourg for their EU bases. Between them, these two centres play host to some 55 per cent of EU UCITS funds under management. Overall, Ireland now hosts €1.83 trillion, compared with Luxembourg’s €3.49 trillion of UCITS assets under management.
London-based alternative investment funds almost universally favour either Dublin or Luxembourg for their EU bases
Thanks to their established ecosystems, both centres are well placed to enable any fund management group to “Brexit proof” its business. “When you establish a fund, you need lawyers, auditors, tax advisers, custodians, administrators and all that infrastructure is already in place in both centres,” says Citi’s Dublin-based Mr Tuffy.
Meanwhile, experts doubt whether the possibility of a hard border across Ireland will undermine the status of Dublin as Europe’s number-two funds hub. Mr Tuffy says: “That isn’t something that’s weighing heavily on anyone’s mind.”
Mr Jacobs-Dean concludes: “The key things for us are ensuring that we have co-operation agreements in place between the UK and the most important European jurisdictions ahead of the UK’s departure from the EU. That matters more to us than anything else, including the transitional and implementation period.”
