Discover more from Fintech Blueprint 🤖🏦🧭
Digital Wealth: Retirement platform Smart raises $95MM for payroll-roboadvisor integration
Smart is used by 70K+ employers and helped 1M+ individuals in retirement planning through their integration of payroll and investment systems
Hi Fintech Futurists —
Today we highlight the following —
NORTH AMERICA: Goldman Custody Business Gains Steam With $1B Add From Prime Capital
EMEA: Smart Raises $95MM In Series E Funding
GEOGRAPHIC NEWS CURATION
An update on format — we are working to consolidate our coverage of the digital investing industry with other innovations in global financial services. To that end, we are likely to integrate the digital wealth takes with coverage of digital banking, lending, and payments to create a holistic view of how automation is transforming the sector. You will see an updated Short Takes that incorporates this approach.
Everything crypto and Web3 will be separated into a dedicated email, so for those of you focused fully on digital transformation but not digital assets, you should still be able to focus on your topic of interest.
As always, leave a comment below with a company of your interest and we’ll do a deeper take on it later!
⭐🇺🇸 Goldman Custody Business Gains Steam With $1B Add From Prime Capital - InvestmentNews, May 17, New York
Goldman’s restructuring last year pointed to the rising importance of the Wealth and Asset management business over things like neobanks and lending. Custody for independents RIAs and money management shops, offered by Goldman Sachs Advisor Solutions, is in line with that direction.
This is a larger offensive chess move for recurring revenue in a volatile market, competing with companies like Schwab, Fidelity, TD Ameritrade, and Pershing. According to a 2020 report, these 4 custodians own ~80% of the RIA market.
A key step was an acquisition of Folio Investing in 2020, an online custodian with $11B in AUM. Now, we see Prime Capital choosing to bring in another $1B. The deal gives Goldman access to Prime Capital's $20B in AUM, but also signals that the firm is making a concerted effort to reach the RIA market. Of course Goldman also has $220B in AUM across its own advisors, as well as manufacturing a variety of proprietary funds.
It may appear that Goldman had somewhat of an identity crisis, first leaning into being a tech firm, and now emphasizing the wealth business. Rather, we think that the firm has done a good job of picking strategic direction, and then clarifying its path once more information became available with a nimbleness rarely available to large Wall Street banks. Only time will tell whether this effort becomes another Marcus, or builds to the company’s existing strengths. In all cases, we like seeing increased competition for RIA assets as independents have gotten bought out.
⭐🇬🇧 Smart Raises $95MM In Series E Funding - Businesswire, May 15, London
UK-based retirement tech platform Smart announced a round of $95MM to power its global expansion, bringing the company’s total funds raised to ~$400MM. The investment was led by Aquiline Capital Partners LLC with participation from Chrysalis Investments, Fidelity International Strategic Ventures, DWS, Barclays and Natixis Investment Managers.
Despite the contraction in fintech multiples, it is encouraging to see checks of this size in digital investing, as evidenced by our recent coverage of Altruist’s latest $112MM raise. Even during a difficult fundraising environment, investor activity remains active and resilient.
Smart is currently used by 70,000+ employers and has served over 1 million people in retirement planning through their enterprise cloud pension platform, Keystone, which claims to have $5B in AUM — a 2,000%+ increase since 2018. Much of this success can be attributed to UK pension reform, requiring employers to auto-enroll employees into workplace pensions. UK rules dictate that there must be an annual minimum contribution of 8% of qualified earnings between employers and employees.
If you’ve had multiple jobs, it could be hard to keep track of all the different pension providers, which is where Smart’s platform comes into play. In addition to being a provider for employers to meet auto-enrollment mandates, Keystone serves as a digital pension aggregator. Pensions can be a conservative industry, yet the total addressable market is $57T. Big data, analytics, and artificial intelligence will continue to push this space forward as it transitions to cloud-native, live data sets and away from legacy systems. We like that Smart combines digital interfaces with payroll integration, and expect that to be a strong competitive position.
North America News
⭐🇺🇸 YCharts And Orion Release Integration Enhancement - Businesswire, May 16, Illinois
🇺🇸 Wealthtech Yield App Partners With Volt To Boost Crypto - Private Banker International, May 17, California
🇺🇸 Wealthtech Groundfloor Is Recognized Again As One Of Atlanta's Fastest Growing Private Companies - PR Newswire, May 11, Georgia
🇬🇧 GBST Extends Strategic Partnership With Novia Global - Fintech Global, May 16, London
🇬🇧 London Real Ventures Invests In Swissborg, A Pioneering Wealth Management Platform Utilizing Blockchain Technology - Cryptoslate, May 5, London
🇬🇧 Investment Platform Joins Forces With Wealth Tech Firm - International Adviser, May 16, London
🇳🇬 4 Wealthtech Platforms Shaping The Financial Ecosystem In Nigeria - IBS Intelligence, May 17, Lagos
Asia Pacific News
⭐🇭🇰 Moomoo Expands Into Malaysia Following Success In Singapore - Hubbis, May 18, Hong Kong
🇵🇭 BPI Wealth Cuts Minimum Investment For Its UITFs - Business World, May 17, Makati
Blogs, Webinars, Podcasts
🇺🇸 Amid Shifting Market Dynamics, How Can Wealth Managers Create Value? - Tearsheet, May 17, New York
🇬🇧 European Wealth Management: Tech Race Is Driving Competition - Private Banker International, May 15, London
🇺🇸 Crypto ETFs Are Year’s Best Performers But Only Lure $12MM - Wealthmanagement.Com, May 15, New York
🇺🇸 The Arrival Of AI And ChatGPT In Wealth Management - Medium, May 17, California
🇺🇸 Crystal Capital Partners' Spring Survey Indicates Investment Caliber 'Key' for Financial Advisors - PR Newswire, May 11, Florida
Events & Reports
🇺🇸 Broadridge - U.S. Investor Study - Broadridge Financial Solutions, May 15, New York
🇺🇸 Wealth Management Edge - Informa Connect, May 21 - 24, Florida
🇺🇸 Finovate Spring - Informa Connect, May 23 - 25, California
🇬🇧 Innovation In Wealth Management - Professional Wealth Management, June 8, London
🇬🇧Private Banking & Wealth Management London Conference & Awards 2023 - Arena International, June 14, London
Shape your Future
Wondering what’s shaping the future of wealthtech, Fintech, and DeFi?
At the Fintech Blueprint, we go down the rabbit hole in the DeFi and Fintech industries to help you make better investment decisions, innovate, and compete in the industry. Subscribe now to level up your knowledge and get access to our weekly Long Takes!
Read our Disclaimer here — this newsletter does not provide investment advice and represents solely the views and opinions of FINTECH BLUEPRINT LTD.