The biggest problems facing fintech today are based on a total disconnect between what the end client really wants and what technologists think they want. Over the past years we have all been sold an idea that technology will solve every problem, that the end consumer prefers the total automation of robos over human relationships.
The industry needs to incorporate the learnings of psychology, behavioral finance and how other industries have achieved success. It’s been proven repeatedly that the best weight loss programs are the ones that provide human coaches, support groups and daily accountability to a written plan. The most successful fitness programs include human trainers, group exercise and, again, daily accountability to reaching goals.
We must develop technologies that provide efficiencies of scale and capitalize on aspects of human interaction and support that lead to long-term success. As Satya Nadella, CEO of Microsoft, explained in his book “Hit Refresh: The Quest to Rediscover Microsoft’s Soul and Imagine a Better Future for Everyone”, AI will provide many benefits in the upcoming decades, but will not replace the two most important aspects of humanity: empathy and creativity, two very important keys to ensuring clients achieve their financial goals.
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?
The financial services industry has historically been very slow to adapt to new strategies and technologies. Just look at how long it took for them to embrace ETFs versus mutual funds. Their own customers, however, have changed, especially the Baby Boomers moving into retirement. They are not willing to settle for the strategies and products that worked for their parents. They are living longer, most without the security of guaranteed pensions, and are demanding solutions and product strategies that make sense and are customized to their lifestyles. The advisors who embrace this change and utilize our strategy and technology have seen an exponential increase in their assets and have re-defined their value to their clients.
It’s not managing portfolios, or running complicated analyses, it’s giving them a real plan whose performance can be tracked daily and is flexible enough to make changes along the way, and a technology that works to protect their income from market downturns that can be catastrophic in retirement.