Irwin Stein

ROBOs are an essential tool for advisors to provide continuous, comprehensive counsel required for fiduciary duty. The difference is the advisor who uses them. ROBOs simply elevate the level of discernment and require a higher level of skill than one dimensional product sales. ROBOs in and of themselves do not require regulation as much as the advisors who use them. If ROBOs are advanced as self contained advisors, then they will find it very difficult to compete with advisors who use ROBOs.
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BlackRock solicits more regulator scrutiny of robo-advisors, eliciting jeers and a cheer

BlackRock

iShares

FutureAdvisor

Polly Portfolio

Oranj

Lex Sokolin

Jasen Yang

David Lyon

Stripped down to its essentials, financial advice is a fairly straightforward proposition. Done well, a highly ethical individual stewards the assets and actions of an investor in a personal and professional interchange.
 
But now a vibrant new class of entrepreneurs is staking their fates and their fortunes on the premise that financial advice can be delivered in a better, cheaper, easier, more ethical, more transparent manner and, as a bonus, in a way more devoid of human annoyance on both ends of the transaction.
 
Cue the robo-advisors, arguably a callous misnomer for automated asset management. 
 
The prototypical robo-advisory entrepreneur has more brands on his or her resume than NASCAR. The bona fides of these industry upstarts often include Ivy-level colleges and MBA programs at Harvard or Stanford. They are often flush with IPO dollars realized at concerns like LinkedIn, Facebook, eBay, Amazon  and Microsoft. 
 
Robo-folk believe that technology is not an enabler of advice but rather, if engineered correctly, advice itself in digital form. 
 
And, they believe the best solutions originate in Silicon Valley or academia, not Wall Street. Robo-entrepreneurs are white-boarding the whole business model, culture and technology from scratch in the conviction that little can be learned from a legacy advice system still rooted in an investment banking culture acting under the core premise that if stockbrokers get rich some of the good effects will trickle down to clients – with the clients none the wiser. 
 
Robo-advisors are a scintillating topic for students of the advice game as they grow by hundreds of millions in assets every month, constantly evolve their business models and receive cash infusions from ever-larger swaths of venture capitals.
 
Throw in the fact that robo-advisors have yet to see a dime in profits -- and won’t in the foreseeable future -- and you have real intrigue. 
 
RIABiz has avidly covered the fast-evolving robo-advice phenomenon and will continue to do so. We present the growing body of articles here.

Robo-Advisors

The near $5-trillion asset manager makes its case for why the robo game is best left to the big boys as critics suggest FutureAdvisor's owner is proposing a solution in search of a problem

BlackRock solicits more regulator scrutiny of robo-advisors, eliciting jeers and a cheer

Stephen Winks

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BlackRock solicits more regulator scrutiny of robo-advisors, eliciting jeers and a cheer

Stephen Winks

Related Moves

March 5, 2025 at 3:20 AM

January 11, 2025 at 3:01 AM

June 7, 2024 at 1:44 AM

July 26, 2023 at 2:34 AM

RIABiz Directory

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