Investing Services That Are Cool Enough For Millennials

Three takeaways from the first day of Finovate Fall 2017.

 
 

Presenting at Finovate is not for the faint of heart.

Companies are given seven minutes on stage to live demo their products (no Power Point presentations, please) in front of an assembled crowd of thousands — bloggers, venture capitalists, other companies, and financial institutions alike.

In its 11th year, Finovate remains one of the best barometers for what’s new and next in financial service technology.

Here are three takeaways from the first day of the event.

No. 1: Investing May Finally Be Cool Enough For Millennials

Much has been made about millennials and their relationship to the stock market — whether they don’t have enough money to start, are afraid of the market itself, or they don’t trust financial advisors.

Whatever the reason, this lack of use is seen as justification for fintech startups to create de facto “investments, but for millennials” apps. Two such companies took to the demo stage on day one, Voleo and Divy.

Voleo, focused on “helping millennials invest today,” takes a social approach to investments.

App users can create different groups with their friends, colleagues, whomever, and democratically vote on stocks in which to invest and divest. The idea allows groups to crowdsource knowledge of the stock market from other friends, while also remaining a social enterprise. Best of all, when proposed positions are shot down, the app keeps track of the portfolio’s performance, allowing the rejected group member to see how good of an idea it would have been.

Divy, on the other hand, operates under the assumption that one of the largest barriers to stock market entry is not knowing what to invest in.

 

 

The app has several pre-built categories of funds through which a user can search. In addition, users can see into what companies friends are investing. Divy aims to be a one-stop shop for investing needs, as well. Users can link accounts from other broker dealers and can trade within the app — with commissions as low as $0.10.

The idea is to make stock trading affordable to any consumer.

No. 2: Prepare For A New Product Category: Home Ownership Investing

Buying a home is expensive, and without a down payment at or near 20%, monthly costs can become prohibitively expensive. This holds especially true for young or first-time homebuyers.

Unison is looking to change that.

The company offers homeownership based on partnership, not a loan. The company will provide down payment funds for the borrower to use interest-free for up to 30 years. These funds, typically 10% of the purchase price — with the idea that the borrow puts up the other 10% — help lower the monthly price of the loan and increase purchasing power.

The kicker? Unison shares in the value of your home. When the value goes up, Unison profits as a partner. When it falls, Unison shares in the loss. According to its website, its share of the change in value is typically 35%.

In addition, Unison offers a similar deal for current homeowners looking to access the equity in their home: a response to the common HELOC.

Unison’s funding comes from institutional investors who are less concerned about the monthly income these investments generate, than the ability to diversify their portfolios. To that end, co-CEO Jim Riccitelli believes Unison has made residential real estate an irresistible asset class.

No. 3: A Unified Customer Experience Is The Holy Grail

Converting a sale or fulfilling a member need is easiest when consumers don’t need to bounce from touchpoint to touchpoint to complete the interaction.

Done correctly, this creates a unified customer experience along the transaction process. And that’s the Holy Grail.

At SaleMove, which provides engagement solutions to bring in-person customer experience online, this is achieved through a three-piece strategy.

The first, automated business logic, serves to detect consumer behaviors and respond accordingly with different prompts to further the interaction. The second is a live chat component that quickly gets the consumer in conversation with a specialist in their area of interest. And third is what called high-touch. This involves a deeper connection between consumer and company, whether through face-to-face video or screen sharing.

While SaleMove focuses on current customer experiences, Onmyway reduces friction in the customer journey to convert sales opportunities on online commerce. The company’s Zapbuy service allows customers to buy products or services directly from ads, reducing both friction in the buying process and the drop-off rate.

 

Sept. 11, 2017


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