Greyspark - The Evolution of Robo-advisory services

Emerging nascently in the early 1990s, in 2017 robo-advisory service provision gathered pace in 2016 due to advances in the primary underlying investment vehicles used by the majority of robo-advisors – exchange-traded funds (ETFs) – as well as the prevalence of Web-based applications usage among target clients and the arrival of innovative fintech players in the capital markets space.

GreySpark's report, The Evolution of Robo-advisory Services, sets out the current robo-advisory landscape that is characterised by a business-to-client (B2C) model and an advancing business-to-business-to-client (B2B2C). Innovative fintech players, or digital wealth managers, that target a client base of high net worth individuals and retail clients with assets under management of less than USD 10m – not traditionally serviced by institutional wealth managers – are struggling to derive profits from their low-cost service models that operate under high customer acquisition costs. Institutional wealth managers – in response to client demand for online services and the potential threat that fintech and digital wealth managers pose – are increasingly investing in robo-advisory service tools and platforms, with many looking to current market participants as potential acquisition targets

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