Wealthfront busts through $20 billion mark with its 'break things but make it happen' approach, but it's bedeviled by details when it comes to customers

CEO Andy Rachleff near doubles assets with high-interest paying robo-bank as new tailwind, but with brand risk as customer service may not be keeping pace, according to one cautionary tale.

Author Oisin Breen September 15, 2019 at 2:42 AM

2 Comments

Michael Cohan: No information can be revealed at any point, lest laundering proliferate unchecked and unabated around the cosmos.

Robo-Advisors

Andy Rachleff

Wealthfront

Personal Capital

Betterment

Brian Murphy

September 16, 2019 — 7:32 PM

Wealthfront is a company that never really found economically viable product/market fit with their wealth management offering. Instead they continue to look for lower cost acquisition strategies to continue driving AUM, that can bring their average revenue per client up. Unfortunately I can't see much in the way of margins on the money market fund - just a lot of likely future churn. Good luck to the team in pulling off a turnaround however.

Greg B

September 16, 2019 — 9:07 PM

ACH fraud is becoming a growing problem and this, not AML concerns, is likely the reason for the restrictions they have in place.

Related Moves

Betterment whistleblowers net $2.5 million • Wealthfront's big pivot leads to profits • Altruist launches tax service • CMOs in at Ascensus, Wealthspire & Joe Duran's Rise • Savvy bags four advisors as Mariner sues it for poaching • Jim Dickson launches RIA stake buyer

Betterment is also bending to RIA needs • Wealthfront is in the black, thanks to cash • Altruist reveals where it makes its money • Rise, Wealthspire and Ascensus each add two executives • Compound hits $2 billion of AUM • CAIS slashes alts prices • BlackRock ups private debt sales to RIAs, through GeoWealth.

June 29, 2024 at 3:00 AM

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

Altruist is CTO-less, for now, quasi-intentionally, it says • Ex-rival exec hired to jumpstart cross-selling Orion products to enterprise clients • BlackRock tops Grayscale • Facet outsources estate plans • Advyzon profits off Goldman exodus • Dan Wiener's RIA has new CEO • CFP count tops 100k

Shiralker out at Altruist • Orion gives Trevor Noble his cause • Bitcoin has a new fund king • Software maker benefits from Goldman custody exec. churn • Carson Group denies lawsuit • Merge of Wiener's old shop complete • 100,000th CFP named.

June 7, 2024 at 1:44 AM

Edelman Financial Engines new CEO will face challenges after AUM plummets $50 billion (since start of 2022) and DOL throws wrench in its business model, complicating efforts to convert robo-advised 401(k) assets to an 'Edelman' RIA

CEO Jay Shah must chart a new course after the 2018 merger of the radio superstar RIA and the 401(k) robo-advisor fails to yield invisioned growth.

July 11, 2023 at 2:46 AM

See more related moves

Mentioned in this article:

Wealthfront
Portfolio Management System
Top Executive: Andy Rachleff

Betterment, LLC
Financial Planning Software
Top Executive: Jon Stein