Last couple of years i have spent disproportionate time on Digital initiatives and Platforms and guzzled on loads of content on Robo-Advisory. The objective of this blog is to bring out the true validated attributes of Digital Platforms and Robo-Advisory. The following notes are insights from two relevant authentic books coupled with my experience.
The first book is Platform Scale by Sangeet Paul Choudary, the founder of Platform Thinking Labs, Singapore. He is currently ranked as a leading management thinker by Thinkers50. He is also the co-chair of MIT's Platform Strategy Summit. He explains the inner workings of new business models and their ability to scale rapidly. The starting point is Platforms are not in the business of building software but in business of enabling interactions among all stakeholders. His sixteen points on Platform Manifesto unravels the scope of platforms and how it can function as plug-and-play. The quest for Platform Scale starts with architecture. This cannot be achieved through marketing initiatives but through a series of architectural considerations for high participation for producers and consumers. Successful platforms ensure they capture rich data through learning "filters". Filters are created based on data captured on an ongoing basis through a user's actions. One question that crossed my mind was, - Is there any personal finance platform which has all 16 elements embedded in it? Lets park this question for few minutes.
Switching to my next book Fintech Innovation by Paolo Sironi, a FinTech Thought leader - Spokesperson IBM Investment and Risk Analytics. Reading this book, one can gain insights about the transformation of wealth management industry. Paolo has given rich inputs on Robo-Advisors, Goal Based Investing and Gamification. The main essence of Robo-Advisors resides in their attempt to institutionalize the “personalization” of the investment experience. It's quite obvious to me now - If personalization is paramount then Roboadvisory portals ought to have "filters" to enhance user experience. In other words, tech has to be the core. I concur with Paolo that incumbent firms are not aligned with the strategic imperatives brought forward by disruptive technology and demo-graphical changes. Tipping point may arrive when digital firms are capable of having emotional dialogue with investors. enlarged data-set can strengthen the positioning of the wealth management offer and enable one to act on sentiment.
My independent view is that most of the existing Indian Fintech firms are yet to leverage these tech trends. Hybrid solutions made up of technology and human advice B2B2C may thrive. Time for Robo-Advisory firms to go beyond captivating user interfaces and graduate to Robo-Advisors 2.0. Is there any real personal finance platform ? My take Platforms seems to be ubiquitous in Personal Finance space, but the fact is that at this juncture it is an elusive one.
