Invisible investing is the next big thing in investment fintech
Over the past decade, fintechs have brought accessible, user-focused and cost-effective financial products and services to a wider audience. This is particularly true in the retail investment sector, where the pace and depth of innovation has been remarkable. Ten years ago, the idea of offering affordable digital investment platforms and apps to consumers with minimum investment thresholds was a dream. Today, fintechs that play in the investment field are on the edge of an Uber.
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The introduction of invisible investing
The entry of Fintech into the retail investment arena has democratized access to products traditionally reserved for qualified investors or those with significant capital. The first wave of investment fintechs introduced a variety of low-cost digital investment platforms, often with a mobile-first approach, such as e-Toro And Robin Hood. However, a significant level of investment knowledge and experience was still required. This era also saw the rise of robo-advisors, such as Nutmegwhich simplified the investment process by automating portfolio management and maintenance.
The next wave of innovation saw the launch of micro-investment platforms like Plum And Chip. These platforms integrated investing with savings and personal financial management, allowing users to round up transactions to invest their spare change in low-cost stocks or ETFs. With the advent of micro-investing, novice retail investors with minimal capital could begin investing with less exposure to complex products, thereby removing the volume of complex information and significant knowledge required. The foundations of invisible investment have been laid.
The push for invisible investments continues
Today’s investment fintechs continue on the path of invisible investment by cleverly playing on customer loyalty. US-based fintech Griffin illustrates this trend. Unlike traditional investment models, Grifin uniquely invests $1 in brand shares where each transaction is made, providing an invisible investment in everyday spending where customer loyalty lies.
Grifin has created a first-of-its-kind investment technology called Adaptive Investing™ that makes personalized investments based on the individual and their daily habits. He constantly strives to create a unique personalized investment portfolio, meaning no two investment accounts will ever be the same. As a fully automated technology, it adapts to users’ purchases, allowing them to have complete control over the amount they invest, without the need to time the market or select stocks.
Aaron Froug, co-founder of Grifin, highlights the company’s unique approach. “Money can evoke complex emotions, not always positive. At Grifin, we aim to infuse positivity and intentionality into financial decisions,” says Froug. The inspiration for Grifin struck him during a memorable moment at a Starbucks. Froug’s sister, commenting on his frequent visits, joked: “I should own stock in this place.” » This simple observation sparked the innovative concept behind Grifin.
Grifin not only simplifies investment but also educates its users. The app includes a 7-day educational onboarding process, providing a daily overview of how it works and financial knowledge. Initially popular with younger users, particularly women aged 18 to 24, Grifin has seen a shift in its user base. Today, women in their late 40s and early 50s, including mothers and grandmothers, are finding empowerment and confidence through the app.
Froug envisions a long-term goal for Grifin that transcends financial returns. “We aim to create a positive feedback on life,” he says. By transforming customers into shareholders of the brands they love, Grifin aspires to influence business behavior in a positive way.
Fintech’s evolution into retail investing, primarily through the lens of invisible investing, comes at a pivotal moment comparable to Uber’s transformation of the ride-sharing industry. Uber revolutionized ridesharing by making the payment process invisible, simplifying and expanding access to taxi services. Likewise, fintechs like Grifin streamline the investment process and seamlessly integrate it into daily life. This change promises to make retail investing more accessible and attractive to a wider audience. With this development, investing is no longer reserved for financially savvy people, but is becoming part of the daily financial decisions of anyone loyal to brands and careful with their money.