The Statistics are brutal!

• 56% of young investors avoid professional advice due to high fees and outdated approaches.
• 51% of respondents feel they lack control over their finances, indicating a significant financial literacy and engagement gap.
• 63% of women are uncomfortable with basic investment principles, with 72% not actively monitoring their investments.
• 47% of participants save little to no income, reflecting poor financial habits and future preparation.

Theo Paraskevopoulos, CEO & Founder of Invessed, is taking the challenge straight on and transforming wealth management to better serve younger generations.

I sit with Theo to discuss the evolving landscape of financial advice in the UK and the enormous challenge we have ahead. Theo shares with us how Invessed aims to empower financial professionals by leveraging technology to reduce admin tasks and enhance client interactions, and therefore provide a solution to this problem.

We cover,

(00:00) Understanding the Hesitation in Seeking Financial Advice

(01:13) The Importance of Purpose in Business

(02:24) Building Purpose-Driven FinTechs

(06:30) Simplifying Financial Services for Greater Impact

(09:42) Engaging More People in Financial Management

(13:48) Challenges Faced by Young Investors

(19:03) The Role of Technology in Modern Financial Services

(22:42) The Responsibility of Wealth

(23:29) Innovative Fintech Solutions

(24:07) Empowering Investment Professionals

(25:40) Behavioral Data and Predictive Technology

(28:43) Customer Pain Points and Scalability

(37:42) Building Successful Products

(41:10) Fireside Questions and Closing Remarks

Follow for more discussions on how to build great FinTech products with Customer and Commerical Impact and stay updated on the latest episodes.

👉 You can find Theo here

• LinkedIn: https://www.linkedin.com/in/theoparaskevopoulos/
• LinkedIn: https://www.linkedin.com/company/invessed-tech/
• Website: https://invessed.com/
• Invessed report: https://invessed.com/invessed-client-engagement-survey-2024/

👉 And you can find Monica here:

• LinkedIn: https://www.linkedin.com/in/monicamillares/
• YouTube: https://www.youtube.com/@moni_millares
• TikTok: https://www.tiktok.com/@moni_millares
• Website: https://moni-millares.mystrikingly.com/

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Production and marketing by Monica Millares. For inquiries about being in the show, coaching, consulting, creative collabs, sponsoring the podcast or creating or editing your podcast email [email protected]

Disclaimer: This episode does not constitute professional nor financial advice and does not represent the opinion nor views of my current, past or future employers. The guest has agreed to record and release our conversation for the use of this podcast and promotion in social media.

Theo Paraskevopoulos - YouTube

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Introduction: Financial Advice in the UK

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Theo: In the UK, we did find more than half of the audience not feeling comfortable enough seeking professional advice

And we think that it is down to two different components.

One is a hard headed price level. I think we think there is a disconnect between what people are prepared to pay for personalized financial advice, particularly as there are cheaper alternatives in the market, even though they're not personal or they are not quite provide you the care and attention of a investment advisor.

And the other component is the level of service where it tends to be a bit old fashioned. There is a lot of wealth managers especially whose service is designed for older the generations who perceive as wealth as a luxury item of concierge services , and younger generations tend to think of within much more utilitarian terms.

Monica: it's a pleasure having you in the show. Welcome.

Theo: The pleasure is all mine. Good to meet you, Marca. Thank you for having me.

Monica: No, thank you. Thank you. So let's go straight into it.

The Importance of Purpose in Business

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Monica: I want to start with the why, the how, and the what. So why is it important and so relevant that today we have conversations around purpose?

Theo: Our own purpose. Purpose is behind everything that we do. We sit in business all the time. When we don't have a purpose, when we don't follow a particular calling, like We run the risk of sounding a little bit inauthentic, like we're made to do this because it's a job. And Purpose gives you that authenticity, gives you that voice that is unmistakable, right?

Monica: Yes, definitely. I can feel the passion. Let's say when you ask me, Oh, tell me about your podcast.

I'm like, you're like top, like when you are aligned with, purpose, whether personal or business, like

Theo: you come to life. It is, as I said, it is the other authenticity. You can definitely feel it. It's, you can't fake it.

Monica: Yes.

Building Purpose-Driven FinTechs

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Monica: So how, what's your take on the how, can we build more purpose driven FinTechs then?

Theo: Yeah, it's a good question. One of the major ways that I think that we can do that is by going back to the basics a little bit. In FinTech, in financial services, where most of my background is, it is all too easy to give way to. Because there is a lot of money involved in this industry. That's not the purpose though.

I, if you protect and accumulate, you build some wealth, you are more comfortable, you've been more secure in the future is always tell people that when they look at a number. It's not just a number, it's somebody's dreams, hopes, and desires over there. You have to remember that it's like behind everything that we do.

There is a human and their own purpose for what they reward.

Monica: Definitely. And you are on a purpose. What is invest purpose? Our purpose is to

Theo: give people visibility, control, a bit more confidence in the financial future. For more information visit www. FEMA. gov There is virus investment, sorry, financial products to do that.

And in order for you to do that, because it's such an abstract concept, it's such an abstract concept. You need the tools and the technology to have a view over it and some control over it to collaborate, perhaps to be a financial advisor or wealth manager. So that's broadly our purpose, about that transparency over your financial future.

Monica: I love how you tie up confidence with financial safety. Because it's you're not just building an investment product. You are helping people have the financial safety such that they can have the confidence to go and live their lives the way that they want. I love that. Totally love that.

You have to be happy. Be able to change their lives. So many people who speak to that, having accumulated, build some wealth over their working lives, when they reach a certain age later in their careers, and they choose to do something completely different, just because they can. That level of control in your life that has got to be at the very, Maslow's pyramid, right?

It's not just, I've made everything else work, all the layers. And now I have got the option to go and do something that is to give something back to do something that is known. I don't have to worry about I've reached a certain level of financial security and I have got options.

Monica: Definitely.

And while we've had a ton of impact, because we have, I think the problem statement, e. g. financial stress has grown faster than the impact we've had. And probably we need to do something differently if we really want to help people. So in your view, what do we need to do to have. 10 times more impact in five years time.

Simplifying Financial Services for Greater Impact

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Theo: I'm going to summarize it as reduce complexity. That is going to go deep into that tower over here. Generally, financial services, especially fintech, we're pretty good at creating complex products, complex communications around it. We're good at finding needs in markets where maybe they don't exist.

Banking has gone a long way to doing that already. I don't know if you, any of us can remember what banking used to be like when you had to go into a branch to do even the simplest of tasks. That obviously has gone away, that has been simplified away. Other subsectors of financial services should follow suit.

There is great strides being made, but I think that if our guiding principle is making things simpler, I think that the impact will be maximized.

Monica: Yes, and especially if I think of investments, simple, is a very good principle. So let's assume that we follow the principle of keeping things simple and we can have 10 times more impact.

Theo: The KPIs would probably be greater financial engagement. We are on a survey where a lot of people told us that they don't save enough, they don't invest enough, they don't monitor their investments if they do have them.

They're not comfortable with the language of investments. And this will give you a clue that there is areas where we as an industry, and I'm talking about the investment management industry now, wealth management We need to simplify the language, the metrics, even the data. We need to present it in a way that it is more akin to storytelling.

I'm in this stage of my life and I need to achieve these goals. I have accumulated this much so far. I need to protect it and build on it. Am I on track? Do I need to change things? Should I not change things? Simple language that is tied to somebody's reality. The KPIs are, I think, tied to the questions that we ask.

Is, I quit or has got the time or the energy or the knowledge to go the self invest route, the DIY route. A greater involvement of people in with seeing people be more comfortable taking financial advice. We think that is a good sign, good KPI for a national financial health, if you like.

Engaging More People in Financial Management

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Monica: How, I think that's a very fair and good point, right? Like, How could you, could we get people to engage more? What's the secret there?

So we know that the product might be great. You have got investment advisors that will design you a great package or even help you along the way. But how you present it matters. One idea here is the idea of nudging. Nudging clients to save more, to invest more, to be more, considerate, responsible with their own wealth.

Another idea here is transparency or visibility. By all means, use the portal, the app, whatever it is that you have make, sure that people, when they need to have access to the portfolio, they have it. And the final idea is about control. When people see that there is a misalignment between their own strategy or their goals, the dreams, and where they are now, to give them the power to change things, to call somebody, to call their advisor,

And make appropriate changes.

It makes us, I don't know, maybe it's because there's so many smart people in the industry and we just need to communicate it in a little bit more down to ground level.

Monica: Yes. I want to expand on that because I think you, described really well the vision on the how to do it, but at the same time, you, as a founder, you have that in your head, right?

Theo: It is absolutely not the easiest thing because people will go deep into their working lives. Absolutely. I think that the language that they use is important. Making sure that there is a human element to the language that we use. We like to obstruct things away, performance, portfolios different investment products, holdings, all these things.

And then the next time you will see that is maybe next year, you have your investment review, and they will ask you the same questions and In fact, if you like me are I needed to go by, we'd probably answer the questions, knowing that we want to be on the risk level where we want to be. Oh, I'm I'm a medium high type of person.

Now that should not be the case. I think that's special. The idea of which should be something a little bit more human. It should be a lot more. How do you feel about things? You should be able to be, to measure your level of stress when it comes to the markets fluctuating. Yeah. Close the circle using human language across the board and especially around the idea of risk, how risky something is and what does it mean is important.

Monica: Yes.

Challenges for Young Investors in the UK

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Theo: Yeah.

Monica: It

Theo: was surprising. Absolutely. We were not expecting these numbers to be so high. In the UK, where it is a country with famously more financial literacy than perhaps the rest of Europe, where you and I might have got some experience, around, but certainly Greece, where I come from, and in Germany, where I live, I expect the UK and the others to be a bit more financially, Fluent.

And yet, for whatever reason, they won't go to a doctor. Yes. range, right? That's that can actually be impactful in a negative way. And that seems like a call to action for the industry. Why would you not seek professional financial advice if you're not comfortable in this world?

Monica: Yeah. And then just to build on that, because it's the stats in the report, it's 56 percent of people.

are saying that they do not actively seek financial advice, whether because they think it's old practice or the cost. Have you guys understood the, why are they not seeking financial advice?

And using our experience of talking to people in the industry, people outside the industry, the consumers coming from a design background, we always champion the customer, right? So we have got that empathy built in because that's where we come from. And we think that it is down to two different components.

One is a hard headed price level. I think we think there is a disconnect between what people are prepared to pay for personalized financial advice, particularly as there are alternatives cheaper alternatives in the market, even though they're not personal or they are not quite provide you the care and attention of a investment advisor.

Wealth as a means, not an end, not as a sign. Having wealth manager is not, oh, I've made it. It's a sign of consumption. I need somebody to help me, actually this is a problem to solve the net effects. Sometimes it feels a little bit like, I don't know, if you're from the world of tourism over here, it's like a, an old school hotel with all the trappings of old school hotels and portable and the rest of it.

Well designed for sure, but no frail service. And we think that's where the whole

Monica: plan is. I think I'm speaking as a consumer and listening to you, right? When you say old school and associate the word old school with financial advisor, and then you think of, Oh, all these people that have approached me on LinkedIn, Then you're like, yeah, you associate that.

So are the financial advisors, reaching let's say 40 and above and then there's not a new generation of people doing that they could relate to the younger guys?

Theo: I'm not sure if that is it. I think that there is a constant flow of new blood in the industry across the board. Now it could be Financial advisors, it could be wealth managers working for companies.

The Role of Technology in Modern Financial Services

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Theo: We know that there is An enormous amount of admin and compliance work to be done, which means that for a lot of investment professionals, they cannot scale the way that they work.

They cannot they have to pay so much attention to these things, to these individual administrative tasks that the, the level of service kind of suffers. That's where technology comes in. That's from our perspective. If we can build the right fintech to empower investment professionals to provide a more scalable, more modern, more digital service, then gradually they should be able to provide the service at the lower fee level and then gradually they will be able to work with a larger team.

1: but,

Theo: and that's an important point, not by removing the human factor, which is a lot of what, FinTech is designed to do, but by empowering.

The the professional advisors. This is an important point is we're not looking to replace them by self invested robot platforms. We're looking to empower them. It's the old saying of human or machine is always better than human or machine. That's the angle.

Monica: Yeah. And, I like how humble you are saying, if there was a FinTech that were to do this.

I'm like that FinTech is yours. And it's called InVEST.

If we're able to do that, I think that we're onto something. I think we're onto something big.

Monica: Yes. And I want to build, now that you say scale, I want to go back to the numbers, right? So there's two different, there's different problem statements. It seems like we have three customer problem statements.

Number one, we are saying, 42 percent of young investors are not comfortable with investment principles, e. g. They don't know and 59 percent of them do not monitor their investments. So this is people who are in investments, but Not really savvy. Then you have 26 percent of. Young, of young, UK people, they don't save, that, that number is huge.

1: a lot of money, 84 trillion is a lot of money.

Monica: And then you put it in the hands of all these millennials and gen sets, that they are so disengaged with their money. And then their parents have been killing themselves for years, building this wealth. And then if we are not good investing, if you are blessed enough to have a family member that leaves you some money.

At least you know how to manage it, right?

The Responsibility of Wealth

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And you still have got responsibility to protect and to build that wealth. It's not just, that's a kind of a frame of mind we need to step out of. It's not about consumption. It's not about the old trappings of wealth and being rich. It is a means to an end, it's something to be protected, it's a problem to be solved.

Monica: And then basically those three problem statements. Lead to us to you, to Theo, to this conversation, right? To invest.

Empowering Investment Professionals

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Monica: So I want to expand on one of the. One of the questions that the audience usually wants to know is, okay, Monica, you have all these people in the podcast, but what makes invest an innovative fintech?

We speak to a lot of investment professional relationships, managers, financial advisors, all these things, depending on the level of service to provide, we see that one of them can potentially work with maybe 20, 30, 50 customers. We asked ourselves the question, what technology would you need? To be able to work with a thousand customers.

It's not a thousand with a few hundred customers, but it's making it real. How do you scale yourself?

Scaling Financial Advisory Services

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Theo: What about replacing financial advisors with any robot advisor or any kind of self trade system or anything like that? It's about giving them the tools to be able to save time from admin tasks and everything else, and then being able to deploy it more productively.

So even if you are inspired one day by the latest of riskiest of stuff, they will tell you, are you sure this aligns with your goals? So these kind of protections, those kind of regulations, that's just where they provide the value. It's not the questionnaires and the admins and the forms and everything.

It's all the soft aspects where they would like them to to be empowered, to save time from that. And to give them proactive view. When things somebody needs a little bit more help.

Behavioral Data and Predictive Technology

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Theo: So what we're trying to do here is we're trying to use behavioral data analytics. We're trying to use predictive data.

No amount of technology alone will drive you through the scenario. It really is technology plus human.

Monica: Yeah. I really like that thinking because I put myself in the shoes of the customers of your customers. And it's so stressful whenever I've tried to find a, An advisory that I'm like, I don't, I didn't trust them.

Theo: I think you're totally right over here. Cause I think that once you ask the question I can always, imagine the, the person that was asking the questions. Do you do the, Oh no, I should.

And they like you, they can go through the thinking process. Oh, it's something that I keep pushing back and back and it's so easy. So, easy to just push it back and forget perhaps something that they, any investment advisor can tell you, they will be right. Time is on your side.

Time is one of the most powerful instruments you have in accumulating or building wealth. You start saving and investing when you're young, doesn't matter how the stock market fluctuates or whatever it is, if you've got time on your side. The compound interest will do its thing, growth will do its thing.

Monica: Yeah. Yeah. And it's because you don't have the know how and you want someone to just tell me what to do.

Theo: Absolutely. You want them to tell you how to do in your own language and in a way that is not going to feel like, it's going to feel a bit more modern it is all digitally mediated these days.

Yeah.

Monica: Yeah. And I think I can feel that you have human, the human side is at the core of what you do. And then. Basically your, fintech helps humans deliver a better service to the other humans, right?

Theo: We help humans, put it that way. So can

Customer Pain Points and Solutions

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Monica: you tell us a little bit about who are your customers?

And their pain points.

Basically any company that manages wealth or assets on behalf of another personal company is the type of company we work with. Typically, there tend to be independent, companies that kind of look after clients. There tend to be banks and large companies have got their own ways of dealing with wealth.

They've got hierarchies and the size and the scale. So we tend to work with more independent ambitious

1: firms. The

Theo: pain points that they're looking at, you can, from their side, you can summarize it as scalability. The industry it's a bit of a technical time, but a essentially it means that before you can jump from servicing 10 clients to a hundred or a thousand clients, you have to jump through a lot of groups that's sensitive.

To be able to service the clients better, to empower the relationship managers or portfolio or financial advisors to do the work more efficiently all the while without losing that personal sense about keeping the ability to provide that coaching, the guardrails that we discussed, but in a more scalable way.

Monica: Okay. Can you go a little bit deeper? As in you, I'm a financial advisor and then you help me scale, let's say from 10 to 25. How does your platform look like slash help me do that?

So that the start of the day. We're knowing that a lot of the tedious work that they want you to do is taken care of. Partially it has to do with reporting. You, at the very simplest level, you've got your client portal, your client app. You know that your customers have got the transparency, the visibility over their investments without you having to create, export, email reports, all these things.

Now, that is not necessarily innovative, it's a baseline level of service that you need to have that reporting sort of things. The second one, however, is the support side. Customers will have questions, you will have questions for them. Being able to facilitate that conversation, And again, it takes in the coaching aspect of things in a lot more automated way.

The third is about the third aspect is about the risk element that I mentioned. If a customer. Is in some kind of distress that misalignment between what the faith level is and what it actually is, you don't have to go for 15 rounds of admin or looking for documentation to figure it out.

The machine tells you, and not always be correct, but it gives you a clue that this is what you need to look out for. So that's another. 20 percent of the work done. And then there is, of course, the Holy Grail of all this, which is to be able to This is what the technology is aiming to do, which is to provide a bit more speed on the advisory service.

Monica: Yeah, it's like my brain is thinking two ways it's thinking as a, Oh my God, that is so interesting as a FinTecher.

And on the other hand, I'm like, Oh my God, I could love it as a customer. Somebody could help me with that. So can you go, yes. I'm like, ah, can you go a little bit deeper, especially on the risk side? Like how good the platform know that. Monica is in distress and you need to call her.

Theo: The biggest clue that we will have on this will be a combination.

That there is a potential level of stress over here. And at that point, if you as an advisor, relationship manager, are able to proactively suggest a remedy, or at least to provide reassurance that, hey, look, this is what happened. You're still aligned, eyes on the prize, long term gains.

Don't go don't go thinking that we need to change something here. The benchmark you have to explain the benchmark and everything is going to show up. Immediately you feel better. So it's about picking up those signals. Behavioral data will give us the first clue combined with things that a company would know, like the investment data and the markets, etc.

And then you're The human

Theo: is not there and you are completely in a self reverse situation and you're not confident. You're not confident. With the numbers, you tend to act in a panic, you sell too quickly, you buy too too late. It's, a human advisor, a professional advisor will help you through this through this transition.

Theo: Possibly, absolutely, that is, that proactive, aspect of the service is very important. What we like to think of it as this way is, it used to be many years ago, thankfully, that your whole visibility over your investments were potentially a quarterly report that arrived on a PDF or even printed through the post.

Many years ago, that was that was the case. Now, eventually. It turned out to be on a daily interaction point, et cetera. What we see that is following that from the reporting side over to the supporting conversation side. Why should the interaction between an advisor and a client be limited to a monthly call or an annual review?

Easiest use case for a support is for the AI to give you a set of answers there. You're not convinced. You ping it over to an advisor, and you're going to get the conversation going. But, it is not a once a month. It it relies on that kind of like quick ping of a conversation. I think this is also important.

Monica: Yes. I am like, I think you built a really good product. Like it's thought from the, there's the problem statement. There's the, human element, but the solution is very well thought through. It's not just Hey, let's put these wireframes together. And then you'll say, It's thought, thought through.

So I'll build on that and I'll flip the question over to you.

Building Successful FinTech Products

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Monica: Given that you build a good product what's your definition of good products?

And everything, if it fits with their life and creates value, then I think that the product has done its job. I think that anything else, any other metric or KPI that you have is incidental. Creating customer value? Really? Actually seeing people use it and not simply love it. We're in fintech it's not a game, it's not entertainment, but if they feel comfortable, then Confident in using it, I think that you have done something well here.

You've moved the needle, so to speak.

Monica: I like that. And I'll, dig deeper because it's not that easy to do, right? It's not that easy to build a great product. So one of the elements that we have in the process of building product is defining the roadmap, right? That's like the biggest question. If you ask like FinTechers in product what's your biggest challenge?

All of them say

1: I wish there was a single simple answer to this. This is very much a, on a per case situation, it has to do with the way that your strategy evolves in response to the,

To the reaction of the market.

Theo: It is something that you have to dynamically evolve in response to market feedback. Part of it. We'll have to do with what you hear from customers. They, where is the value that you're creating, whether it is in our case, I mentioned reporting on the support side, on the risk assessment side, all these things, another part will have to do with the effort that is involved to bring.

And actually releasable or shippable so you can start getting, collecting feedback and that roughly creates your your roadmap. There are circumstances between us now in the, while you're building FinTech, where you have to slow down a little bit. Where you actually have to pick something in your roadmap.

Of course, it's a product strategy, so you just have to

1: be mindful of that balance.

Monica: Theo, I absolutely love the product and the approach and the mindset.

Fireside Questions and Reflections

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Monica: So before we close, I just want to add two to three, fireside questions, just like to put you on the spot. So what's the secret to building successful products with impact?

Theo: Listening before doing, not necessarily market research, just spend a bit of time with your clients and your clients.

If you're a big debate, understand what you're building. I can't stress how important it is. Especially financial services, where there is so much volume created in plumbing, in the financial plan, in the invisible grid, that we sometimes forget the human factor at the very top. Very important.

Monica: Yes. Your customer is listening to you.

What would you tell them?

I'll be using it as you are interacting with the financial advisor. I'll be using it once a year, when you're downloading reports for the taxman. The point is, what is the trigger? The trigger will give you a lot of clues about what, how you want to prioritize your features in your project.

Monica: Interesting.

Cool. Okay. So what is your most memorable customer review?

Theo: Few years ago, when we were exhibiting the app together with the client in the event that they had for an investment and I had two opposing sides of the client that was a work marketing and they were both in the for, assessing the technology.

Doesn't matter if you're eight or where your wealth came from, inherited, made, whatever it is. When it comes to it, you have the same board.

Monica: And my favorite question, if you were to change one thing in FinTech that had the most impact on customers, employees, and shareholders, what could that be?

In the same way that, ah, when you develop a language, you don't need to pay. You can develop a language that kills yourself again, or a language that you're tired of or think of the same way, but with humanizing the language a little bit more so that it would like to stay there. I think that the industry would get more creative if we were to go there.

It was a sandwich by people for people at the end of it. It's not, it's not just there to generate ever bigger and bigger numbers. We do this for something.

Monica: Thank you so much, Theo. It was an absolute pleasure having you in the show. I love your ethos, the product, the problem statements. It was a pleasure.

Thank you.

Theo: Oh, pleasure is all mine. Thank you so much, Monica. Bye bye.