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Finnish startup democratises wealth management with automation

“We were frustrated with some of the current practices in wealth management and wanted to build a service we would like to use ourselves,” says Jussi Kallasvuo, Evervest CEO. EVERVEST

How do you feel about receiving financial advice from a machine? Finns are about to find out as Helsinki-based startup Evervest will launch the country’s first fully automated wealth management service.

Wealth management has traditionally been built around strong personal relationships, but not for long if you ask Evervest. The year old startup is on the frontline to bring an era of fully digital ‘robo advisors’ to Europe.

“We want to democratise wealth management, which previously has been available mainly for the very wealthy,” says Jussi Kallasvuo, co-founder and CEO of Evervest. “Evervest is a next-generation digital, automated wealth management platform.”

Instead of a Terminator-type robot, Evervest’s robo advisor is intelligent software that automatically invests, tracks the market and rebalances investments based on their customers’ goals.

When a new user signs up for the online service, they answer various questions on their background, investments goals and attitude towards risk. Evervest’s proprietary software then tailors a portfolio suggestion to match the user’s profile and, if the customer gives the go-ahead, completes the investments and monitors the portfolio.

This represents a new age in financial services. Customers get 24/7 access to their robo advisor and transparent view to their portfolio. For Evervest it is all about making investing more accessible and affordable for everybody, even those without any previous investment experience.

Finance background

However, Evervest is not completely without a human touch. The backbone of the software is data provided by Kallasvuo and his two co-founders Antti-Pekka Törmänen and Timo Tähtinen. The trio have put their financial industry and management consulting backgrounds to use in building risk profiles, choosing investment instruments and models and making sure Evervest really understands its customers.

“It is a complete turnkey solution,” says Kallasvuo. ”The customer can focus on living their life and leave worrying about investments to us. Our job is to understand the customer’s background and goals as well as possible.”

“We have focused strongly on making a service that is really easy to approach and use. We want to reach people who do not have any previous investment experience,” says Jussi Kallasvuo, Evervest CEO. Image: Jussi Kallasvuo

If a user adjusts their risk profile or investment goals, their portfolio is changed accordingly.

The key for Evervest is transparency and this applies to its revenue model as well. Unlike often in traditional wealth management, the company does not have separate transaction or banking fees nor does it receive any kickbacks for recommending a specific financial product.

“We choose the best possible products for each case and take a very transparent procentual [management] fee,” says Kallasvuo.

The cost of the automated service is up to a one per cent of the value of the portfolio, which covers all expenses.

Future is automated

Robo advisors are fast gaining traction in the US but Evervest is among the first companies in Europe (and the first in Finland) to tap into this fledgling market. Kallasvuo believes demand for more digital and automated services will grow rapidly.

“There are three major factors driving the change,” he explains. “Consumers want to use these kinds of easy-to-use services, there is a need for improved cost-efficiency in the industry and digital advisors are easy to control, which fits well with tightening regulation.“

Evervest is confident its focus on building a service that is both simple to use and accessible to all gives it an upper hand compared to competitors. Furthermore the ambitious startup, whose platform will soon be launched, already has European expansion in mind.

“Our goal is to be an international player,” says Kallasvuo. “We will first build a great service here and then take it abroad. We will have to see what the exact timetable is, but if we are not operating in at least one other market by the end of next year, we will be disappointed.”

Evervest will launch Finland’s first fully automated wealth management service, also known as a robo advisor. (In the picture from left to right Timo Tähtinen, Deepak Natarajan, Jussi Kallasvuo, Antti Törmänen.) Image: EVERVEST
By: Eeva Haaramo