Robo-advisors, also known as online wealth management services, are on the rise. The combination of low interest rates, high commissions from banks and low returns from other investment vehicles, means fertile territory for fintech startups willing to manage -and increase- people’s savings through technology.
US-based Wealthfront was one of the first startups to disrupt the sector. The company has raised more than $129 million from multiple VCs and currently has $2 billion in assets under management.
Spain lacked a service of such characteristics, with the only example being London-based ETFmatic, co-founded by the Spaniard Luis Rivera.
Led by Unai Ansejo Barra, François Derbaix and Ramón Blanco, Indexa Capital is now joining the field, with an initial investment of more than €1 million from Cabiedes & Partners, Fides Capital, Viriditas Ventures (Yago Arbelos), Derbaix, his wife Marta Esteve (Soysuper, Rental) and Álvaro Ortiz.
The Madrid startup is launching today, promising better returns for investors willing to give the company at least €10,000. Derbaix and Ansejo had previously founded Bewa7er, a secondary market for company’s shares that was put on hold weeks after its launch.
Indexa Capital, Wealthfront and similar companies in the sector enable clients to invest their money on a monthly basis in a diversified portfolio of index funds. The service competes with traditional investment services offered by banks, but promises much lower commissions (0.79% annually vs. 3.40% at banks, according to Indexa), automated processes, better returns and more transparency. Indexa says that it expects to offer its clients annual returns 3.1% higher than banks.
To know more about ETFs and index funds, read this article from Samuel Gil, where he explains the great opportunity for automated wealth management services. “Robo-Advisors”, he says, “pretend to offer a fully only service as good (or better) than the one provided by traditional advisors, at a much lower cost and with smaller investment requirements. Good, pretty and cheap. And for the masses”. Derbaix has also written about the project here.