Robo-advice firm Moola is to close at the end of February, FTAdviser has learned.
In a note sent to clients, published on Twitter by Boring Money managing director Holly Mackay today (January 14), the company stated following a “strategic review” Moola would close at the end of February, with payments no longer being taken after January 17.
Clients with assets on the platform will have those assets sold and the cash placed in the bank account they have registered with Moola.
Any clients who incur a capital gains tax liability as a result, Moola’s statement said, would see those costs refunded.
Moola has since confirmed the move.
Moola was founded by television personal finance expert Gemma Godfrey in 2015, and later sold to JLT employee benefits, which was itself later sold to Mercer.
When acquired by JLT in 2018, the company said Moola would become part of its “core offering” on its rewards and benefits platform.
Ms Godfrey had remained chief executive of the firm until November 2019.
In 2016, Moola agreed to partner with technology provider Evalue to launch an investment platform aimed at both advisers and consumers.
The robo-advice sector has in recent years attracted capital from large financial services firms such as Schroders, which backs Nutmeg, and LV, which backs Wealthify.
But some have not fared as well as expected. In May last year it emerged Investec was closing its Click and Invest robo-advice business following two years of losses.
Ms Mackay said the challenge faced by many robo-advice firms was the heavy cost of advertising and marketing to acquire new customers.
She said she expects to see “more closures” and more M&A in the sector in 2020.
FTAdviser previously revealed that Nutmeg spent £3 of revenue for every one pound of assets it acquired in 2018.
Simon Bussy, consultant at Altus, previously told FTAdviserthat most robo-advice firms will need to evolve into technology providers for incumbent players if they want to survive.
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