The Institute for Innovation Development recently had a discussion with Sean Brown, the president and CEO of YCharts—a fast, intuitive, cost-effective financial research platform that is not only transforming bulky research terminals into easy access web portals and mobile phone apps but also focusing technologists on a wide range of wealth managers’ pain points. These kinds of efforts show a change in fintech company strategy. Advisors are no longer just tactically buying technology out of a box. Increasingly, they will also strategically partner with financial technology companies.
Hortz: Why did previous investment research platforms have to be installed on bulky terminals on your desk and what exactly has changed with your technology to be able to bring this institutional level resource to an anytime/anywhere web and phone app environment?
Brown: As is common in the world of technology, first-generation solutions were built on then-current technologies. We are now employing the most current technologies to solve previously existing business challenges in a new, much improved way. And we’ve set out to do this with investment research tools, and more broadly, in financial technology through the advisor’s business. We are also 100% cloud-based, so our application is available to our users in the office, on the train, plane, in the coffee shop or at home. So as a result, investment research has now been freed up to take place anywhere, at any time.
Hortz: How does the power and functionality compare between the two and what are some new features YCharts has recently added to the platform?
Brown: Some of the Goliaths in our space strive to be all things to all people: offering real-time market data on every global asset class, proprietary news, chat, trading interfaces, etc. They charge an ultra-high price and ask users to become adept at command line codes and user interfaces that take six to 12 months to master.
At YCharts, we keep it simple: We provide all the data and tools that wealth advisors require to select the North American equities, ETFs and mutual funds that meet their clients’ investment needs. We’ve partnered with the market’s best data vendors and cultivated numerous data sets of our own; however, at the end of the day, data is data and it most often ends up being commoditized.
Our big differentiators are what we do with the data, and what we enable our users to do with the data. We use the data to create proprietary evaluation grades like our Y Rating that enables our customers to benefit from our assessments of securities. Additionally, via easy-to-use functionality like screening and filtering models, dashboards, Excel add-ins, charting, etc., we help our users quickly discover and effectively communicate their investment ideas graphically.
Hortz: You have stated in your presentations that your research platform saves advisors an average of 3.6 hours of time per week, which equates to a 620% ROI. Can you outline for us how you determined these numbers?
Brown: We conducted a client survey where our customers told us that we saved them an average of 3.6 hours of time per week. This included time spent searching in disparate locations to find data, time spent manually downloading data to Excel, time spent creating visuals and time spent comparing and deep diving on investment alternatives, etc.
On average, they told us their time has an opportunity cost of $200 per hour. When you compare this $720 per week ($2,880 benefit per month) to our $400 per month price for the high end of our platform, you end up with a very compelling ROI of 620%. As investment professionals, our clients recognize great ROIs when they see them.