Fintech startup Aveni, a firm which is helping advisers plug the gaps exposed by the incoming consumer duty, has landed £2.75mn.
Led by a handful of Scottish investors, the new funding will fuel the firm’s efforts to disseminate its product further across the UK advice market. It adds to a further £1.7mn the firm has already raised.
The 30-person team, which is half based in London and half in Edinburgh, helps advice firm’s executives understand the risks they are running from a consumer perspective.
Using artificial intelligence, it can detect vulnerable customers by extracting information from client calls and automatically checking for signs of vulnerability.
Advice firms can access the results of these checks, which also flag expressions of dissatisfaction and conduct issues with advisers, via a dashboard.
The startup told FTAdviser it has already signed a contract with a large UK advice firm, that it is unable to name, which is using the technology to not only meet consumer duty requirements, but also to grow its adviser count tenfold.
Back in February, Aveni’s chief executive Joseph Twigg claimed the company can make the advice process 50-70 per cent more efficient, which he said is attractive to big companies for growth ambitions.
As well as serving larger advice firms, Aveni is also keen to work with smaller ones through networks. The startup is already talking to a number of them.
“Most firms are in the analysis stages and haven’t covered their gaps - whether that’s in the way they represent their product, or how they communicate with clients,” Twigg told FTAdviser today (June 21).
“But this investment is well timed with consumer duty.”
The Financial Conduct Authority will announce the final rules next month, after which firms have until April 2023 to ensure their businesses prioritise good consumer outcomes.
“Adoption will shift from ‘nice to have’ to essential,” said Twigg. “Companies will have to start thinking about adapting their operating model, reducing cost to serve and automating processes.”
Twigg noted a few advice firms he has spoken to are now being asked for tranches of data by the regulator.
“The FCA is asking for collections of data from firms now,” he explained. “It can cast its net much wider, and it means it doesn't need to do supervisor reviews. It can collect data and analyse it using automation. It is switching from people and process-first to a data-first regime. It's saying ‘don’t tell me, show me’.”
Twigg moved to Edinburgh back in 2010 to work for Scottish Widows Investment Partnership. He then moved to Abrdn prior to its acquisition of the firm, and later witnessed the merger with Standard Life.
After establishing links with Edinburgh Business School - which is now an investor in Aveni through one of its colleges - Twigg founded his start-up.