Speaking to FTAdviser, Peter Ridlington, chief executive of Ningi, discussed the launch of a free financial health check tool in partnership with New World Financial Group, which aims to make financial planning and education more accessible.
Ningi creates and develops integrated software and digital tools for financial planners and said the launch aims to help close the ‘advice gap’, something it believes can be done in large part by addressing the lack of integration between existing technologies.
Ridlington said: “My degree is in accountancy computing, but I'm a chartered financial planner, so I started life as a trainee adviser, spending a lot of time working in compliance but because I can code it's that combination of skill set.”
Ridlington began his career on a graduate scheme as an account manager at Mattioli Woods and later moved to Wesleyan where he held a number of roles over nearly three years, including as a compliance consultant.
“They're spending huge checks on projects that never quite make an impact that they’re supposed to and Ningi was all about finally doing that and executing on the vision.Peter Ridlington, NingiHe also worked as a product director and principal product manager over a span of another three years at Wealth Wizards.
“Me and the team that form Ningi were on a project at Wesleyan - the insurance society - where we looked at hybrid advice as you would call it now but looking at how to make the advice business profitable,” he said.
“We automated financial advice back in 2012 there and pretty much my entire career [has been] in robo advice, hybrid advice, building digital journeys for different people and the business itself was formed effectively, the week of the first lockdown.”
He explained that part of his motive to launch Ningi came about after spotting a problem that has been there for over ten years.
“I feel like the industry has had this vision of what tech needs to be for financial advisers for over a decade, an end to end process that powers up human adviser hybrid advice.
“I've been working for different people to try and make that happen, different consultancy roles and it's not been done. It's not been cracked.”
Cutting out the bureaucracy
A topic in the industry that is recurring is the advice gap and Ridlington argued that this was a key motivator when it came to the launch of his company and tool.
He explained that the advice gap situation, specifically for smaller advisers, sees many on track with their business plan, where they're increasing or aspiring to increase the value of a client, because they cannot cost effectively serve smaller clients.
“The emerging problem is that the future clients of most IFAs are either smaller in current wealth and about to inherit money or are just never going to be wealthy enough to justify a £250k, £500k or £1mn portfolio,” he said.
“We're seeing a lot of advisers struggling to deal with those smaller clients who represent the future of their business and our intent is to provide a solution that deals with that.”
The solution to it is, in Riddlington’s words, “robo-advice effectively for every IFA in the country”.
The plan is to offer a robo-advice solution that can be pushed out to these smaller clients.
“Importantly, a solution that ties into a hybrid back office that also serves the client once they do attain wealth,” he said.
“It’s a robo capability built into their core proposition. Effectively IFAs can serve those and come down the value chain- that's the big problem we're seeing.”
If we sense from a firm that they know what they need, and they're willing to make decisions and move quickly, that's the dimension we make decisions against.”Peter RidlingtonHe added: “We're not really looking to compete as a back office or as a website or as a client portal, but it's about pulling that together.”
Ridlington explained that over his career span, he has helped build a number of products and solutions that have “stayed on the shelf for various contractual or commercial reasons from the big guys”.
“They're spending huge checks on projects that never quite make an impact that they’re supposed to and Ningi was all about finally doing that and executing on the vision,” he said.
With Ningi, Ridlington explained that it has focused on the smaller ambition of advisers that have control over decisions and sit in front of clients.
“It will ease and cut out some of the projects and bureaucracy and those elements from the biggest bends and that was the real motivation to finally do something I know people want,” he said.
Ridlington explained that when he first started the business, the plan was really to work with firms of less than 20 advisers, purely as they are the ones underserved by tech providers at the moment.
However, he said the firm already has clients such as Mazars, who are large international firms, and it has quite a few of those as well.
“[There’s] not really a maximum or minimum size of the firm, it's more about the appetite of the firms who really move quickly and make decisions where there are avoidable costs.
At the moment, our approach is really to limit new clients onto the platform... We're cherry picking our favourite advisers. Peter Ridlington“There's situations where there could be 12 months with 20 people in a room, arguing over what the thing needs to do.
“If we sense from a firm that they know what they need, and they're willing to make decisions and move quickly, that's the dimension we make decisions against.”
The tool
The tool performs a comprehensive fact find, after which it determines financial risks, creates a range of priorities and a personalised report before giving users the chance to chat to a professional
The financial health check is a tool that advisers can launch through Ningi and allows advisers to start engaging with any consumer, whether that is someone who is wondering whether they should pay down debt or invest £100 spare cash.
“At the moment, it's acting as effectively a triage where if the clients that go through or the prospects have sufficiently complicated and valuable problems, it will triage them into a conversation with advisers. Where it doesn't, it signposts them towards the free solutions that are out there and relevant guidance.
“It's our foot in the door to that holistic financial planning tool powered by advisers and over the next six to 12 months, we'll be adding more features in there that basically solve problems for people.”
He explained that the tool is the “backbone of financial advice” where people walk through simple questions and it helps them decide should they be paying down debt, taking out protection, investing or picking up with an adviser to focus on retirement plans.
“It's that type of priority setting,” he said.
The money
Ridlington said the firm is “aggressively cost effective” from everything about Ningi and the technology to where it capitalised as a business.
“It’s about really being dramatically cheaper than a comparable position,” he said. “Our entire platform is kind of all you can eat effectively so you pay per client, rather than per service delivered.
“Advisers effectively can deliver the financial health check and only pay once they take on a new client so the vast majority of people going through this aren't going to be a cost to the adviser and it's only when they take up investment advice or whatever it might be.”
Once an adviser does take on the client, Ningi charges £1 per client, per month.
Ridlington said from a tech perspective and from a funding and capitalisation perspective, the firm is already set up to be on that “high growth, startup journey”.
“At the moment, our approach is really to limit new clients onto the platform,” he said. “We're cherry picking our favourite advisers.
“It sounds really mean but we're launching with early adopters and once or twice a month, we're bringing in a new firm.”
He explained that a lot of those firms, such as New World, are launching new propositions and helping to shape the products.
“Next year, you'll see a lot of new launches from us around an investment solution or advances on the health check, automated mortgages, that align with those firms.
“Meanwhile, we're building the holistic wrapper around that and eventually, we will launch software as a service hands off style where you go to our website, put in your credit card and buy the software which will be maybe next year.
“That's the ultimate plan but right now we're focused on real deep strategic partnership with firms where we embed ourselves effectively as the tech team and work on shaping their proposition, even helping them with marketing.”
sonia.rach@ft.com
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