3 Questions with Min Zhang of Totum Wealth

FintekNews is pleased to offer our weekly feature column “3 Questions With”. Each week, we feature a thought leader within a unique sector of fintech and ask them to answer just 3 questions for our audience in their vernacular. This week, we’d like to introduce you to Min Zhang, Co-founder and CEO of Totum Wealth,

a turnkey solution providing holistic investment insights and risk profiling tools for financial advisors to use with their clients, based on their life situation.

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How did you personally become involved in fintech?

I have always been interested in the intersection of finance, data and technology. I studied computer science and econometrics at Dartmouth, and then worked as a “quant,” building models to select stock investments. After Stanford business school, I helped build the investment models at Nutmeg in its early days, worked at PIMCO in asset allocation, and at Pacific Life as Director of Risk Management of multi-asset variable annuities. I saw the opportunity to help retail investors and financial advisors better understand risk from my experience in investment management and creating solutions for some of the largest institutions in the world.

What does your firm do/offer within the fintech sector?

Totum is the first and only risk tool that helps financial advisors understand how much risk clients can comfortably take based on their life situation. Totum takes into account each client’s unique industry, location, health and financials to quantify the overall ability to withstand potential losses.

With Totum, advisors can easily customize how to engage with clients and have in-depth discussions about their risk preferences, risk capacity and portfolio risk. Our approach to risk and easy-to-use design helps advisors build a strong client/advisor relationship that leads to long-term profitability.

Our public API enables advisors to seamlessly monitor and review the risk scores on existing CRM, financial planning and portfolio management software.

How do you feel consumers (or if more relevant for your firm – businesses) are adapting to the facet of fintech that your company operates within?

I feel that consumers are starting to adapt to wealth tech, but customer acquisition cost remains high for B2C wealth technology companies because, first, lack of education – while we grow up spending thousands of hours learning certain skills, how to best deal with money is never taught in school. Even though most of the tech solutions are very simple, easy and many are guided, consumers may tend to put off dealing with money and investment matters until absolutely necessary. Second, most robo-advisor solutions are still silo-ed or focused on selling a set of investment strategies, rather than helping consumers understand what they need given their life situation in a comprehensive manner. Third, financial advisors who can be more holistic don’t have the business model, or incentive to serve consumers with less investable assets.

I also do not feel that financial advisors and wealth management firms are adopting new technology fast enough. Most firms see the need and have the willingness to adapt, but are slowed down by the nature of a large company. They do still have the economy of scale and most robo and wealth technology startups have realized the importance of leveraging these larger firms for reaching more users. I think a new business model that is not based on gathering assets under management (AUM) and charging a fee, while leverageing technologies that are comprehensive, accessible and intelligent, might be able to challenge the larger wealth management firms in the future.

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Min Zhang is chief executive officer and co-founder of Totum Wealth, a turnkey solution providing holistic investment insights for financial advisors and their clients. Since founding Totum in 2015, Zhang continues to oversee strategic planning and day-to-day operations for the company including, business and software development, partnerships and customer relations.