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Lucy Alphonse, Consultant
Lucy Alphonse is a Senior Consultant at Oxbow Partners.Contact Lucy
November 14, 2019 Lucy Alphonse
ETFmatic offers a D2C and B2B white-label robo-advice proposition.
The business allows investors to access ETFs through an easy-to-navigate digital platform. The company, which was founded in 2014, originally launched as a D2C proposition but quickly discovered that there was also an opportunity in B2B2C.
Three partners are currently live with ETFmatic’s B2B solution. Chief Commercial Office Tom Stevens told us that at four further partners are scheduled to go live soon. The firm are authorised by the UK’s FCA but are passported to operate in 32 European countries; one of the partnerships expected to go live soon is with a bank in Belgium. There is also interest from Asia and the Middle East.
ETFmatic’s B2B solution offers end-to-end digital capabilities and is completely modular. Most of the firm’s clients have existing offerings and so opt for API integrations rather than full white-labelling.
ETFmatic’s capabilities include onboarding, automated invoicing and portfolio management, which can be bespoke or done according to the company’s model portfolios, of which there are 21 per currency (euros, dollar, pound).
From a consumer perspective, we like ETFmatic. It is still difficult to find intuitive investment portals in many European markets, particularly those where traditional institutions continue to have a controlling influence on the market. The business will present an attractive alternative in these markets – like, for example, Austrian InsurTech Impact 25Member Finabro.
ETFmatic serves as an interesting case study for two technology trends in life insurance.
First is the emergence of B2B2C robo-advicor propositions. As we noted in a previous blog, much of the activity in the robo-advice space has focused on D2C distribution (Betterment, Nutmeg, Scalable Capital, Plum and wealthsimple). ETFmatic is one of several InsurTechs focused on B2B(2C). A company we recently covered, Hatch AI, is also pursuing this path by digitising the advisor model and thereby increase the efficiency of the advice process.
The second trend highlighted by ETFmatic is the modularisation of technology (which we illustrated in this 2017 infographic). Across life, health and P&C we are increasingly seeing a rise of API-driven, cloud-native technology providers that offer best-in-class capabilities to incumbents. This increasingly presents an alternative to the use of monolithic end-to-end ‘full stack’ systems.