News, Vision & Voice for the Advisory Community


Why Mike Sha has a 2015 goal of $1 trillion in robo-assets for SigFig and where Marissa Mayer fits in

The ability of the ex-Amazon whiz to make slippery YahooFinance users sticky appears to be the get to launch this fueled-up rocket

Author Kelly O'Mara May 27, 2014 at 2:34 AM
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Mike Sha: Most people have a lot of dirty laundry that needs to be cleaned.

Stephen Winks

Stephen Winks

May 29, 2014 — 7:50 PM

Advice and advice products are not indistinguishable, as personalized advice is not possible in advice products yet is required for fiduciary duty. Generic algorithms solve for cost but not professional standing or the rarest commodity of all judgment. If only SigFig, Personal Capital, Betterment, et al would embrace prudent process (asset/liability study, investment policy, portfolio construction, monitoring and management) based on objective, non-negotiable fiduciary criteria of statute, case law and regulatory opinion letters which affirm technical competency, one could at the least could establish they were technically rendering advice—something no US Brokerage firm can establish.

Then it would be a question of how good the personalized advice—will the emerging outsourced CIO functions emerging for advisor use be better than Robo Advice? Certainly Robo Advice is cheaper but does the cost savings trump expert portfolio construction? There are many, including Matt Pierce, Ron Carson, Brent Boadeski, etc. who have achieved outstanding performance at very low cost. The winner is value added personalized advice, but Robo Advice will capture the mass market—the bread and butter of the retail brokerage industry which is fast being rendered irrelevant in not acknowledging or supporting advice .


Bill Winterberg

Bill Winterberg

May 31, 2014 — 1:26 PM

Can everybody just stop with the “xxx plans to have $1 trillion on its platform by 2015?”

Forbes does it too: “Stein expects the company [Betterment] to manage over $1 billion by year-end.”

It’s misleading and specious statements like this that get RIAs in trouble with the SEC.

And don’t ask me; ask Les Abromovitz and Brian Hamburger what they think about statements like this.

Related Moves

Wealthfront cedes to four years of investors clamoring for crypto by taking on expensive third-party vendor that Betterment rules out

The Redwood City, Calif., robo-advisor turned a hard 'no' into a soft 'yes' by dealing with Grayscale and its 200 basis-point-plus fees, which its robo rival in NYC -- also without a crypto path -- finds ludicrous.

August 14, 2021 at 2:20 AM

Second Betterment exec departs as new CEO Sarah Levy orients to her first month on the job and is confronted by personnel matters

Chief operating officer Dustin Lucien is the latest to leave the New York City robo-advisor, one of at least eight positions open as it prepares a push across multiple business lines to ignite growth.

January 19, 2021 at 6:32 PM

Wealthfront's unlikely tapping of Sheila Bair and Tom Curry signals likely push to gain a bank charter, analysts say

The Redwood City robo-advisor's addition of two renowned former chief banking regulators brings legitimacy and guidance that could lead to a margin-fattening bank charter and help solve the robo-advisor's problem of high client acquisition costs.

December 31, 2020 at 4:37 AM

Jon Stein ousts himself as Betterment CEO and taps Sarah Levy, who joins an exclusive club of top women executives, with a mission -- an IPO

The co-founder of the New York robo-advisor headhunted the ex-Viacom brass through Harvard professors on the down low to ostensibly scale operations.

December 8, 2020 at 5:27 PM

See more related moves

Mentioned in this article:

Portfolio Management System
Top Executive: Andy Rachleff

Financial Planning Software
Top Executive: Atindra Barua

Betterment, LLC
Financial Planning Software
Top Executive: Jon Stein

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