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It was a pleasant surprise to find that many Finovate attendees had the same opinion of three of the presenting companies that WealthManagement.com covered, voting them among the total of five Best in Show.
Banzai and Golden, in particular, should be of interest to advisors for their focus on two different ends of the spectrum of all our financial lives: the beginning and the end, respectively.
Banzai focuses on financial literacy and financial decision making for young people, whereas Golden is a digital tool that empowers those caring for elderly parents or other seniors in general.
Kids typically get very little in the way of financial literacy education at schools these days; a recent study by Merrill Lynch found that 72 percent of parents wish they had someone to educate their children about investing.
Banzai, a startup that demo’d at Finovate, is attempting to solve this conundrum by specializing in financial education. They provide financial wellness courses online that “mimic real life,” including solving real world dilemmas—like understanding your credit and credit scores to setting financial priorities.
The application can provide branded tutorials that wealth managers could, in turn, share with their clients for use with the client’s children; there are three levels of courses: Banzai Junior for elementary grade students (aged 8 thru 12), Banzai Teen, designed for middle, junior high and high school students (aged 13 to 18) and Banzai Plus, for advanced classes (aged 16 and up). According to the company, more than 30,000 kids in hundreds of schools are using the application (which is free for both); more than 500 banks and credit unions also sponsor schools in their community.
Banzai also sells its online platform and content lessons as a customized option to financial institutions, mostly to banks and credit unions to date. Head of Banzai business development Landon Glenn estimated that a custom engagement with a single financial advisor would likely be as low as $1,000 a year. For larger firms or enterprises this would scale up to around $5,000 to $50,000 annually.
Despite the name, Bond.AI has nothing to do with munis or other types of bonds. (There’s a riff on James Bond in the company FAQ.) While it’s not the real fictional Bond, it is a front-end meant for banking customers (or other investment company customers) that, according to the company, “provides deep personalization” through the world’s first “Empathy Engine for Finance.”
Hyperbole aside, this was one of the slicker demonstrations at Finovate. Attendees witnessed an Alexa voice integration—the company’s CEO connecting to Bond.AI through voice prompts, that in turn connected to a bank’s back-end—that felt like a conversation.
One part of the presentation focused on query about whether he could afford a mortgage for a house, he fed in a couple of inputs and the final response from Bond.AI was “In the next 17 months I will help you save for the down payment.”
The proprietary Empathy Engine has three modules: holistic analyzer, conversational intelligence and path analyzer. As the company describes it, their offering will help banks “embrace the irrationality of their customers and intimately understand their behavior,” provide an age agnostic user interface and “help meet user needs (front facing) and bank’s needs (back office) in the shortest time.”
What also grabbed our attention is that a key investor and partner is the core banking powerhouse FIS and that Bond.AI is already working with seven banks (possibly through its relationship with FIS).
Golden’s chief executive, Evin Ollinger, put it this way during his Finovate demo: “Mom, she holds 50 percent of the $40 trillion in U.S. wealth. Less than 50 percent of her wealth will stay with you.” Sure, at the moment he was referring mainly to banks (it’s Finovate after all), but the same can probably be said for advisors too.
In a nutshell, Golden’s value proposition is that its Financial Assistant application and services can help a loved one organize all of a senior’s financial accounts. You, as the loved one, empowered by the senior, can then get online read-only access to make sure that important things don’t get missed and bills are paid on time. If you and the senior arrange for power of attorney, you and the loved one can also manage bill pay and take the reins on other duties, if, say, the senior starts to suffer from dementia or some other debilitating long-term health issue. Among the other features are fixed income budgeting, fraud protection, document vault and bot alerts.
As a trusted advisor, this application or something like it, is the perfect tool to be recommended either to your older clients or for your clients with older parents. Simply put, according to Bloomberg some five million older Americans are financially exploited every year through fraud by scammers.
Announced at Finovate, Tolerisk 401(k) is now available. The company, which launched in 2014, is known for its two-dimensional risk tolerance tools, meaning it measures the participant’s ability to take risk and the probability that they could outlive their money. The 401(k) product features a Personalized Asset Allocation Roadmap, which can provide participants a recommended asset allocation that is tailored specifically for them, albeit provided by the advisor and automated by the technology. Among the characteristics the software takes into account the participant’s specific time horizons, savings patterns, spending habits, assets in the plan, as well as other retirement income.
An often-cited problem when it comes to actually delivering digital advice remotely is that many of the conferencing or screen-sharing applications used still require a download and too much setup for the advisors—not to mention the clients. Unblu rectifies that by having no download; the service works from behind the incumbent firm’s website. A client would just click on a link the advisor sends.
The firm has also developed its own co-browsing technology, LiveView, as well as document co-browsing. The Basel, Switzerland-based company has been around since 2008, is already used by more than 100 European banks and financial institutions including UBS, Barclays and Deutsche Bank and is furthering its expansion into the U.S. banking and financial services space. It’s easy to picture it as an offering for wealth advisors through custodians, IBDs or large RIAs.
While the demonstration at Finovate was lacking, the idea behind this company is an interesting one for anyone young enough to be both a parent and a heavy user of the internet and social media. Founded in 2012, Ballooning Nest Eggs attempts to address what the company refers to as “a pervasive, modern-day problem”: Millennial parents tend to prefer financial gifts for their kids but rarely receive them beyond a few discrete life events. Why? Asking for money—especially from non-immediate family—is awkward.
The platform doesn’t appear to be live, its website asks visitors to sign up “for early access.” In theory, the application would allow a connection between two domains, social media apps and financial accounts at institutions, to allow for prompting financial gifting. In other words, providing parents the social tools “to tastefully steer and conveniently enable their network to gift” their kids money at the many and varied celebrations in their life.
Whether it’s Ballooning Nest Eggs, a payments company or a social network itself that gets there first, someone is eventually going to be successful in a big way—if they’re pumping assets into the accounts of your clients and growing your AUM—which could be a good thing for you too.
