LFP126 – Can Fintech Fill the Financial Advice Gap? w/Max Rofagha CEO Finimize

As we heard in LFP069 Financial Advice costs a packet these days – for most folk it’s simply uneconomic. But FS is a complex topic for those who have spent a lifetime in it let alone those with no experience. We all have debts, assets, cashflow, pensions, and many tax complications swirling around in a landscape of ever-changing rules.

Can Fintech come to the rescue? Can an App help fill this gap?

Max Rofagha is the founder and CEO of Finimize a Fintech established to enable Financial Empowerment through content and community. Otherwise known as to help you manage your dough through educational means and the ability to crowdsource ideas/feedback/ratings.

As their website says:

“We live in an age where we can get all the information we want within a tap. Yet, when it comes to our finances, we remain stuck in an opaque world that few really understand. Finimize is a new beginning. We are building a suite of products that sets information free and puts valuable tools in the hands of the people. In a language we all understand.”

Topics discussed include:

  • Finimize have gone from being a daily newsletter to 1,000 to a community of over a third of a million
  • The origin and uniqueness of the Rofaghas, Persian/Iranian surnames
  • Max leaving Berlin before it was cool and hip – journey form a German/American school to studying in the UK and working in Switzerland
  • his personal pain around, despite having an economics degree, not knowing how to invest his savings when he had built them up – the inspiration behind Finimize
  • party manifestos should be nigh-on legally enforceable as they are a social contract between parties and the people; democracy is meaningless if parties post-election then just rip-up the manifesto
  • the gap and transition between the education system and work
  • Max’s career journey and rediscovery of passion for online products via a summer at Ebay
  • start-up in Zurich followed by founding Finimize 2016 in London
  • Max’s realisation that even sophisticated FS folk don’t know the answer to simple investment questions
  • his frustration with either expensive financial advice or banks selling their own products – which is the so-called Advice Gap below around £250k of investable assets
  • “we want to empower users to be their own financial advisers”
  • their first iteration of building a holistic financial planning tool
  • users only got excited about investment portion so pivoting to start with that and then leading them on to the bigger picture
  • comparison with John Kay on the LFP who spoke of the limited number of types of financial/life situation and how this should be amenable to Fintech-isation
  • rainy day fund for young people is generally advised around 3-6mts
  • long term boring investment via ETF’s along with some more interesting/socially interesting/useful investments on top
  • Finimize see themselves as being a pharmacy vs a hospital – sometimes in complex circs you will of course need a hospital – but most needs can be handled via a pharmacy
  • comparison with how the travel agent market has changed. How this directly relates to FS advice at present
  • FS education gap as an example of Peter Thiel’s point that education per se is on the edge of revolutionary change
  • Udemy, Coursera
  • students buying Bitcoin as an example of poorly-advised first investments
  • Finimize accept that for many folks this is a dry, dull topic – their approach is to supply information in short “snackable content”
  • their daily news must always fit into 2-3mins at most
  • consumer-centric content compared to producer-centric content
  • BJFogg and building blocks re habits
  • business books summarisable on a couple of sheets of A4 – hierarchical structuring of content
  • books as very old school content – just longform – no shortform overview available
  • how Finimize approach this dynamic
  • crowdsourcing what other similar folks are doing
  • choice-paralysis
  • so-called robo-advice as a lead-in to folks realising they need advice (and not just to buy ETFs with a fee on top)
  • Finimize’s freemium model – daily newsletter (free), packs of information on topics (subscription), community (free)
  • Finimize co-produce sponsored content
  • Finimize’s shout-out to employers to help their employees sort their finances

And much much more 🙂

Share and enjoy!