BRANDING

Betterment unlocks purpose-driven growth

In fintech, there are new companies coming and going. What separates success from failure is when value-based branding 🤝 operations. 

It’s 2022 and as the world has shifted, particularly in the last ~2 years, it has become increasingly important for organizations to authentically tie their values into their products and services.

Betterment, the nation’s largest independent digital investment advisor ($33B in AUM and 700,000+ users) is a great example of a fintech that has catapulted its next wave of growth with this strategy. 

Why it matters

→ Growing inequities and moments of social reckoning have spurred more investors than ever to put their money into value-based companies. 

→ Public expectations of your fintech have never been greater. Every fintech must show how it makes a positive contribution to society. Without a sense of purpose, you cannot achieve success. 

What the CEO told me

Betterment CEO Sarah Kirshbaum Levy shared with me her keys to purpose-driven growth in today’s environment: 

#1 Movements of our time

When Sarah first arrived at Betterment in December 2020, the fintech’s SRI investment portfolios were the fastest-growing portfolios, attracting more than $1B in less than five months into its launch. 

→ Why? Because values met relevance. Today’s fintech user wants to be an activist and believe in the businesses they associate and affiliate with. 

“We have a climate portfolio, a social justice portfolio, and a broad impact portfolio: These are the movements that this generation wants to be involved in…it sparked the next wave of our growth.” 

#2 Channel collective energy

With value-based investing skyrocketing, Betterment builds on that momentum.

→ How? It partners up with Engine No. 1 (shareholder activists driven by the idea that social good also benefits the bottom line) adding the new $VOTE ETF to its SRI portfolios. 

“The idea behind $VOTE is you can be in a long-term diversified portfolio, but at the same time, you can actually be active in having a voice..they’re trying to really channel the collective energy behind investors.” 

#3 Break out of norms

A great brand is made with a resonant mission and values that build internal culture and excite passion from your customer. 

The fintech audience is digital savvy, they want an easy-to-use product & mobile-first – that’s all table stakes. 

→ The tricky part is serving and reaching your audience in new ways. For Betterment, that means branching out to have unexpected content partnerships to reach new audiences and break out of traditional user bases. 

“Back to my early days at Disney, when you think about the theme parks and the level of perfection they strive for like not a piece of garbage on the sidewalk…

apply that going forward, think about customer experience, being able to respond to customers with really quick turnaround times, and delivering that moment of delight for your customer.” 

CRYPTO

Satoshi is Black 

Once again Bitcoin’s price slumped. Tyrone Ross, CEO of Onramp Invest, a crypto asset integration platform for financial advisors, joined Cheddar on Monday (Bitcoin’s birthday) to explain that we’re all still looking at the wrong metric: Bitcoin’s price. 

Why it matters

With the rise of the metaverse and NFTs in 2022, the crypto industry has a huge opportunity to reach mass adoption.

To get there, the most important metric to look at is the Bitcoin hash rate, which correlates to the strength of the network based on the number of active miners. 

→ The hash rate of Bitcoin reached an all-time high, which means security and stability for the network, and 1.8 billion people globally are receiving access to financial services.

Ok, but what will help the price?

Tyrone and the Onramp Invest team are betting on the wealth management space to bring the next trillion in market cap to Bitcoin. 

But the wealth management space is much slower to join Bitcoin due to a lack of access (which means their customers are too). 

• The industry is still facing regulatory, compliance, and operational hurdles.
• A spot Bitcoin ETF will help, but the industry still needs clarity around concerns like how to manage custody and which digital assets are securities. 

TL;DR: To get the crypto space moving forward at market cap and price, wealth managers, RIAs, and broker-dealers need to enter the space at mass.

For now, crypto education provides an opportunity for the wealth management sector to become more relevant to the culture of today’s increasingly influential crypto community.  

WTF ELSE?

Quick hits

• Google acquires cybersecurity platform Siemplify
• Robinhood announced the beta launch of its cryptocurrency wallets
• Bitwise launched a Non-fungible Token Index Fund
• Fintech investor Ribbit Capital raised $1.15 billion in new capital 
• Stripe gets ready to launch in Israel 
• Coinbase exec says Ethereum scaling improvements coming 
• Betterment study shows financial benefits are a top priority for employees