Meta’s rollout of the Threads app—the “Twitter killer”—produced millions of sign-ups, not because it was so different, but because it was so similar. Just another example of tech chasing its tail. What happened to innovation?

That’s why my chat with Dave Hegarty on my WealthTech on Deck podcast was so energizing. Hegarty founded Playbook, a platform for Gen Z and millennial investors that focuses on what customers want.

How did the Playbook team find out? By asking them—about 500 of them. And what Playbook heard was this: We know the rich got rich by paying less in taxes.

Ask Before You Build
Where some entrepreneurs use intuition plus a scan of competitors’ capabilities to design their platforms, Hegarty sought to understand his market before design and coding were underway.

He used social media ads to woo young investors to his website, where Playbook asked permission to call and listen to their fears and concerns about money. They admitted that they:

• Know alarmingly little about building long-term wealth.

• Don’t have people they trust to turn to for advice.

• Want to be like the rich, who they know pay less in taxes.   

“Our average user is 30 and making about $150K a year,” Hegarty said. “They’re making good money, yet are terrified they’re going to mess up.”

They deeply fear someday regretting the steps they did not take—many have parents who haven’t saved enough—and of doing the wrong things now, Hegarty said.

Where can they turn? They don’t have confidence in their parents’ and contemporaries’ advice or are too embarrassed to ask. “It’s like seeing the dentist and being lectured about not flossing,” Hegarty said.

Professional advice isn’t easy to secure, either. Most wealth managers aren’t accessible to most investors, particularly those who are only starting to invest and save. 

Research Inspires A Platform To ‘Beat The Tax Man’
The Playbook team developed a platform and app that educate users on building wealth by taking advantage of the tax opportunities their employers and the government offer. “It’s hard to beat the market, but it’s easy to beat the tax man,” is the Playbook philosophy.

“Playbook is the app I wish I had when I was in my 20s and early 30s, working for Microsoft and not taking advantage of its 401(k) match,” Hegarty said, observing, “Just because you earn good money doesn’t mean you know what to do with it.” (Read more about Playbook in this case study.)

For $19 a month, Playbook offers investors:     

• A personalized financial plan aimed at helping achieve their goals.

• Analysis of their tax-advantaged savings opportunities, based on their employers’ plans and their income, and directions for using them.

• Advice for what assets belong in what accounts (IRA, 401(k), Roth) for maximum tax efficiency, a practice known as asset location.

• Direction for what accounts to tap when they need cash for a house or other major purchase and want to minimize their tax liabilities.

A premium plan, Playbook Plus, delivers a megadose of tax alpha. For $59 a month, it adds multi-account tax harvesting and rebalancing to keep investors’ money aligned with their goals and risk tolerance while limiting their tax liability.  

It has also released a product, Playbook for Work, for employers who want to encourage participation in workplace-sponsored savings plans and support their employees’ financial well-being.

Playbook and other up-and-comers are aiming at giants of the industry. When I asked Hegarty who his chief competitor is, he said, “Fidelity, although I’m not sure they would see us as their competitor.”  

Perhaps not today. But even Fidelity, Vanguard and others could heed the Playbook example by earnestly asking customers what they value and then delivering on it.  

Jack Sharry is co-chair of MMI's Digital Advice Community and a Next Chapter Executive Leadership Advisory Board. He hosts the WealthTech on Deck podcast and is executive vice president at LifeYield.