WealthTech investments at record levels and set for huge further growth

The already rapid growth in WealthTech innovation and investment has been boosted by the demands of customers during lockdown restrictions.

Investments in WealthTech companies were already on a strong upward trajectory prior to the Covid-19 pandemic. Rather get held up by lockdown restrictions, the development of the WealthTech industry actually gathered speed as customers were forced to access banking and investment services via mobile and desktop.

The last 15 months has seen usage of online financial services jump to a level that might not otherwise have been expected for another five to ten years. This surge has profoundly impacted the retail financial services and the wealth management industry in a number of ways.

CX is now non-negotiable

The deficiencies of established online financial service providers were quickly exposed. In particular, the operations of many of the largest online brokers caved in under the weight of customer usage, forcing many to switch off their systems. In the case of Robinhood, the online robber baron of the industry, the outage cost thousands of their customers money and resulted in penalties from regulators.

For those wealth managers, retail and private banking firms that had lagged in the take up of digital transformation of their businesses, the potentially disastrous consequences of being industry laggards were brought sharply into focus.

Most importantly of all, customer expectation levels have reached new, irreversible, heights. Whilst it was already the case the case that cosmetic make-overs, slow response times and superficial functionality wouldn't cut it with customers over the long-term, now such gimmicks won't even provide companies with breathing space as a short-term option: customers will disappear rapidly.

It's now imperative for every business-to-consumer financial services company to aim to provide industry-best customer experience, regardless of whether they were established in the bricks and mortar era or as online-led businesses. CX is now non-negotiable.

If you would like to understand industry-best CX in wealth management join us at our upcoming Digital Wealth & CX Tech Forum.

The impact is not restricted to B2C businesses. Wholesale financial services businesses are also having to adjust to remote working challenges and the need to enhance technology that supports the extra demands on information security, communications, transactions, compliance and data analytics.

Investments in WealthTech companies reached record level in 2020

Between 2016 and 2020 global annual investment capital in WealthTech companies tripled from $2.8bn to $9.3bn. The restrictions related to Covid-19 failed to slow down investors.

The first quarter of 2021 saw even greater acceleration with an extraordinary $6.6bn invested in 162 deals. It needs to be said that these numbers are skewed by the $3.4bn raised by Robinhood - which will presumably be used in part to repair their CX failures and the rest to mask their deficiencies through advertising, PR and hype. Nonetheless, after excluding Robinhood from the scene, the investment picture is still extremely positive.

The most innovative and promising WealthTech companies over the last year can be seen on the 2021 WealthTech100

An informative way to see the latest developments is provided by reviewing the solution providers on the WealthTech100.

Each year our analysts at FinTech Global list the companies that have developed innovative solutions to enhance the wealth management industry. In conjunction with an advisory board of industry experts we list the 100 companies that every wealth management organization, private bank and financial advisor should know about.

Wealth management and other financial services firms that are dealing with the challenges of the last year, as discussed above, would do well to engage with the WealthTech solution providers on the list - if they don't want to fail their customers or lose out to competitors.

These are some of the WealthTech industry's leading companies

Amongst the extraordinary companies on this year's WealthTch100 list are these industry-leading WealthTech solution providers:

AlgoTrader: provides institutions and professional traders with quantitative trading solutions including order and execution management for digital and traditional assets

Doxim: communications technology leader providing omnichannel document solutions and transforming experiences to strengthen engagement across the lifecycle in financial and regulated markets

Etops: offers ecosystem for the financial industry which includes operational services, multi-bank reports, interactive dashboards, compliance solutions, PMS and CRM systems

FinTech Automation: automates financial institution's front, middle, and back-office and integrates fintech solutions and services into their product sets

GBST: provides technology to the global wealth sector enabling firms to streamline operations, rapidly launch new products and engage your customers

HUBX: helps scale institutions’ private placements and deal syndication activities by simplifying workflows and leveraging data to accelerate digital transformation

Kidbrooke: B2B financial analytics APIs, helping organisations create the seamless financial services of tomorrow

Movius: а unified cloud-based communication solution used by leading financial institutions for compliant voice, text, and WhatsApp messaging

Ortec Finance: delivers leading technologies and solutions, enabling financial institutions to manage the complexity of investment decision-making

PaxFamilia: digital wealth planning platform that helps financial advisors serve their clients with a structured and holistic approach to their finances

Smarsh: provider of capture and archiving technology and services aimed at highly regulated industries with strict compliance and e-discovery requirements

Strategy Marketplace: tactical Robo Advisory platform helping financial advisors hedge their current investment strategies and diversify clients’ portfolios

SwissQuant: one of the first Wealth Management Platform to fully integrate ESG systematically throughout the entire portfolio construction and advisory process

TelosTouch: elevates client experiences with digital tools and empowers advisors with actionable insights

Tindeco VISION: enables wealth managers to implement highly scalable operating models so that they can efficiently offer customised investment solutions

TrueLayer: Europe’s leading open banking platform, providing global financial connectivity through open APIs

Wealth Dynamix: provides intelligent end-to-end Client Lifecycle Management solutions solving the complex requirements of client acquisition, onboarding and ongoing relationship management

WealthObjects: helps firms launch modern fully automated or hybrid digital business models in investing and savings as a B2B financial technology partner.

A full list of the WealthTech100 can be found at www.WealthTech100.com. More detailed information about the companies is available to download for free on the website