By Lauren Keyson and Sarah Grieco
iQuantifi is unique in that it is the only robot advisor in the marketplace that doesn’t require a human advisor to personalize comprehensive financial advice. The service works with all financial institutions including banks, credit unions, investment and insurance companies, who can now provide financial advice to their entire customer bases, not just the wealthy.
Tom White: We call ourselves robo-planners because I believe we’re the only ones able to automate the entire financial planning process to where it doesn’t require a human to provide comprehensive financial advice. Regular people, or the majority of the population, don’t have access to that type of advice because it’s not possible for the financial advisor industry to work unless you have a certain asset base or income level. So the reason I founded iQuantifi is for the financial institutions to be able to help inform people and help them achieve their goals through our software. It also recommends the institutions’ own products to their customers.
Lauren Keyson: How did you come up with idea originally?
TW: The story went back a while ago when I wrote a blog called ‘Walking the Dog’. One day I was walking my dog and I was thinking about my old firm and comparing it to the new smaller one. We basically had clients in about 15 states at that point, without even doing any marketing out of state. The reason for this is that when we set up a relationship with a local client, we’re able to make that relationship through technology. Then we’d get together with client once a year — I’d go to cities around the country and meet with multiple clients in each city.
In looking at how we got to 15 states, I asked myself, ‘How can we reach more people and really expand this with technology’? We were trying to automate the entire product process. That required a sit down with a face-to-face advisor who provides the advice and who targets the millions of the underserved public who are not eligible to work with an advisor.
LK: As a financial person you probably didn’t expect to be a “techy” person too – how did you do the technical part?
TW: It’s always been a bit of a challenge. When we first built a prototype back in 2012, we originally outsourced it just to prove the concept. Then, when we actually built a platform, we had our own internal tech team do that. I wrote all the principles embedded in the software having to do with quality financial and investment advice.
LK: Do you think this robo-finance trend is going to continue?
TW: I believe that it will, but as a former advisor, I also believe that there’s always going to be a place for the human advisor; particularly so for more complex situations like higher net worth income levels. At the same time, technology has its place trying to automate some of the processes for more efficiency and for being able to reach more people. Even though there are 100,000 or so investment advisors across the country, they’re still only focused on the top 5%.
There are just a lot of people who are not receiving good financial advice. Typical technology tools show them where their money has gone, as opposed to where it could go – and they don’t provide advice. We have the advantage of already being in the space.
LK: Because iQuantifi is geared towards those who don’t necessarily qualify to work with an advisor, are you specifically targeting millennials?
TW: A very small percentage of millennials are at the asset or income level that really qualifies them to work with an advisor. We provide advice in teaching them proper financial plotting. This is something you want to start as early as possible, so that young people will build up those habits and experiences and be much more willing to work. I think we are helping millennials achieve their goals, even if many of them don’t necessarily know what their goals are. We’re getting them engaged in the process.
Millennials are looking for these technology solutions. A lot of it has to do with the user experience and the target market. When we were only aligned towards millennials, we knew what the look and feel of the platform should be. We knew they were more intuitive and that you didn’t have to spell things out about how the app worked. But now that our potential clients could be anywhere from age18 to 100, we have to make it more flexible and easy for any age group.
