Allianz Ventures is investing in MoneyFarm, a digital wealth manager, and will take a minority holding in the company. MoneyFarm views this move as confirmation of its progress since its launch in 2012 and its move into the U.K market earlier this year.
According to Paolo Galvani, chairman and cofounder of MoneyFarm: “We have a relentless focus on creating solutions that fulfill customer needs. User-friendly technology is not enough without excellent portfolio performance, and we are delivering on that count as well. Our performance through market volatility, created by the vote to leave the EU, is testament to our investment strategy.”
MoneyFarm stated that the financial services industry reflects that digital solutions will soon account for a substantial share of the overall wealth management market. A.T. Kearney predicts that the digital wealth management market in the U.S. will grow to over $2 trillion by 2020.
Consumers are demanding mobile wealth management services and wealth managers save substantial costs with digital technology. These two factors are fueling the growth in the online and mobile wealth management industry.
According to Galvani: “This investment is an endorsement of what we have achieved so far and also an indication that we have so much potential ahead of us. It is becoming increasingly clear that existing players in this space have barely scratched the surface of possibilities. Across the whole investment lifecycle, there is a need for a better model and a better solution. All the feedback we get from our customers is that this is exactly what they have needed.”
“The combination of online and offline advisory has become a key trend in the wealth management space enabled by technology. Based on the partnership with MoneyFarm, we will further drive innovation to provide better experience to our partners and customers” said Solmaz Altin, chief digital officer of Allianz.
The MoneyFarm team includes senior managers from BlackRock, Deutsche Bank, Google and Morgan Stanley. In a previous investment round, MoneyFarm raised €16 million from U.K.-based Cabot Square Capital and United Ventures. This was one of the largest FinTech fundraisings in 2015 of its type.