21st Century Wealth Management: Interview with Elisabeth Dana

There is a lot of activity in all parts of the financial services industry. Everything is changing. And it is changing very fast as more companies are coming to the market. At the same time, the industry is awash with VC investments. First, it was a huge wave of innovation in payments that is still going to this day. Yes, Stripe, we are looking at you and your upcoming huge IPO. We are not there yet in a few areas. Quite some work still needs to be done to truly democratise finance. For instance, private banking or wealth management. We asked a few questions to Elisabeth Dana, Founder & CEO of Infinity Circle, on what 21st century wealth management looks like.

Tell us more about Infinity Circle. What is your background, and what is the story behind the company?

My name is Elisabeth Dana. After 20 years in the financial services, I have had the benefit of working in various sectors within the industry.

I left the corporate world in 2016 to establish Infinity Wealth, an FCA regulated wealth management entity. And in December 2018, Infinity Circle was inaugurated. Infinity Circle is designed to be the Financial Technology (Fintech) entity, or more precisely, the wealth-tech digital hybrid platform. The 20 years in the industry taught me much. But it also showed me the current limitations of the traditional banking structure. This is what inspired me to undertake this venture in a move to properly introduce the art of wealth management to the everyday man and woman.

What do you see as the main challenges in the wealth management industry right now?

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Private Banks and Family Offices, the incumbents within the sector, predominantly target high and ultra-high net worth individuals who represent a minute proportion of society. It creates a sort of exclusive ecosystem among the upper echelons of society. However, fintechs and wealthtechs are democratising the industry by giving access to wealth management services to aspiring high net worth or top mass-affluent individuals, who hold 40% of the world’s private wealth.

Have you noticed that our bank statements are now a succession of Netflix, Uber, Spotify, Deliveroo, Apple and Amazon payments? All of which offer us a comprehensive range of services like films, transport options, music, and food at our fingertips. They are curated for us through algorithms with the future heading towards AI matching software, which would efficiently connect us with our desires in a competitive way in exchange for money. Click, pay, and it’s ours to enjoy! This digital transformation within the wealth management space is redefining how clients interact with their money and investments.

Do you think that we should do more financial education?

I strongly believe that there are financial benefits to improving financial literacy on a global scale. Having said that, the challenge is often not with financial literacy, but with people’s attitude towards their money. It is not uncommon for people in the aspiring high net worth category to describe money as ‘difficult to manage’ or ‘impossible to grow’. This demonstrates the necessity for a shift in the narrative in order to incorporate a more positive attitude when it comes to managing and growing wealth. Ultimately, why not optimise every pound we generate to have the lifestyle each of us desires whilst we cultivate our wealth.

The increasing digitisation of the wealth management industry, while largely benefiting clients, may initially seem like a threat to traditional wealth managers. This should not be the case. While it may at first seem overwhelming, when viewed through the right lens it is an opportunity to improve the services we offer to clients and increase efficiency. From the perspective of a client, it is also important to understand the key trends and changes currently underway in the industry.

What is the future of the wealth management industry?

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In order to properly speculate about the future of the wealth management industry, one must first understand the industry’s past. For you cannot understand where something is heading without first understanding where it has been. Among the many changes that have occurred in the industry, I would argue that three have been fundamental in what is to come.

Prior to the 2007 Global Financial Crisis, traditional wealth managers benefited from clients who took greater risks with their investments. These riskier portfolios generated higher advisory fees for wealth managers, due to the higher returns. However, the landscape changed after 2007 and investors began.