The retirement wars are heating up.
As millions of baby boomers leave their jobs in the coming years and transition into retirement, there is a huge competition for who will manage their savings. On one hand are traditional wealth managers, firms like Edward Jones, who either employ full-time human financial advisors or empower independent contractors to help clients plan through their finances. On the other side has been the rise of “roboadvisors” like Wealthfront that use algorithms and simple financial products like ETFs to advise people at lower cost.
VCs have been bullish on roboadvisors — startups like Wealthfront and Personal Capital have each raised more than $200 million according to Crunchbase — but there has been less investment activity trying to help the financial advisors themselves. After all, aren’t all these folks supposed to be automated away by algorithms?
Vise (from “advise”) is taking a bit of a contrarian bet: its founders Samir Vasavada and Runik Mehrotra believe that humans — augmented with the right AI tools — can prove even more adept at handling the financial affairs of their clients than an app.
The company debuted at TechCrunch Disrupt SF last year, and we wrote up an in-depth profile of its journey from self-funded startup to our stage. Well, according to the founders, it just so happens they met Sequoia at the firm’s Disrupt happy hour, and one thing led to another and Vise is now announcing a $14.5 million Series A term sheet led by Sequoia partner Shaun Maguire.
For the founders, the main goal for Vise has been to build a new product using the best practices from the AI and machine learning worlds and converge on a platform that helps independent financial advisors come up with their own ideas to communicate to clients. “Our big thesis was, we want to think about things that are different in this industry — we don’t want to build a product that’s the same as how every other product has been built in the space,” Vasavada said. “We want to build a radically different product, and the way in which we do that is bringing in a diverse team.” That’s included everyone from product folks at notable Silicon Valley companies, AI researchers, and financial services experts.
Financial advisors already rely on a suite of software from CRMs to investment analysis platforms to perform their jobs, but those tools have rarely been integrated into one place. That’s made the existing market for software here quite fragmented. “Number one is it’s too bloated. There’s just too many tools and they don’t do enough and don’t provide much value add. It’s expensive. It’s hard to manage. And the most important thing is it is not at all personalized to the advisor or personalized to the client,” Vasavada said.
Instead, Vise aims to be a one-stop shop for all the needs in the daily workflow of an investment advisor. That includes determining different investment options in a clean interface, personalizing those options for individual clients, and even helping guide investment advisors through the talking points on why certain investment decisions make sense compared to others given a client’s context.
In their views, Vasavada and Mehrotra see the wealth advisory market dividing into several buckets, with independent wealth advisors who target $500,000 to $2 million in assets per client as the sweet spot for Vise. Those customers have more specific needs and require more personalization than clients with less assets and so are ill-served by roboadvisors, while at the same time, major institutional players find them too small to handle given the fee structures they have at their scale.
Ultimately, Vise is a pure B2B play, and the founders want to maintain that focus into the future. They believe that wealth advisors have special knowledge of their clients needs and the relationships to match, which Vise can’t compete with.
In addition to Sequoia, Founders Fund, and Bling, Human Capital, Lachy Groom, Steve Chen, and Jon Xu joined the round according to the company.