First Wealth boss eyes private backing for hybrid advice service

Currently, the service - which launched on desktop last week - focuses on smoothing the process of onboarding new clients, bringing together what First Wealth’s Anthony Villis has termed “disjointed processes”.

But soon, Villis envisions building a Nutmeg or Moneyfarm-type app which advisers can white-label to build direct relationships with younger clients, with the ability to jump in and help clients with planning when needed.

Some financial planners have already shown an interest in investing.Anthony Villis, First Wealth

“We will start automating parts of the financial planning journey,” Villis explained.

This will include things such as predicting how long a client could live for, what protection they might need in place, and basic retirement planning.

Villis told FTAdviser the hybrid advice service - Open Advice Technologies - can build an app in just a couple of months but the firm will then need to test it. 

In the meantime, the IFA boss is keen to raise some capital.

Self-funded until now, Villis wants to secure private investment in the first quarter of next year.

“We want the service to be built by advisers for advisers,” he said. “Some financial planners have already shown an interest in investing. If we can get 15 or 20 planners to back it, that could really help shape the service as well as fund it.”

Open Advice is already used by First Wealth.

Since launching the service to the wider market last week, Villis said the firm has scheduled demos with 10 different advice firms. 

The regulator is coming round to the concept that not every client needs a 30-page suitability letter.Anthony Villis, First Wealth

First Wealth is an appointed representative of Benchmark Capital, formerly Best Practice.

Open Advice is in the process of plugging into the network’s ‘Enable’ customer relationship management system, which will allow data to flow more freely. 

It is already plugged into P1 Investment Services, which means the portfolios are already lined up so clients can open accounts.

“The idea is to have an entire ecosystem. So the client goes into their app, engages with their financial plan, manages their investments, opens an Isa or a Gia, and then the reports are generated,” Villis explained.

“It’s light touch financial advice with parts of the planning automated. Planners want to help, but it’s about giving them the tools to do this.

"The regulator is coming round to the concept that not every client needs a 30-page suitability letter, which is making it easier to give lighter touch advice.”

‘Evidence-based’ financial planning

Earlier this year, Villis shared some details on the type of financial planning he wants to create with technology.

He termed it “evidence-based” financial planning, which is driven primarily by data and probability, and which can avoid the “cognitive bias” carried by advisers.

“It’s very difficult to argue with evidence-based data and I think people like straight talking,” said Villis.

“We’re not saying the adviser is redundant. They can sense check the data and talk through it with the client. Their role comes later down the line, to talk about the options rather than build them.

“If you could remove cognitive bias around loss aversion, everyone would be invested in everything. But humans are flawed investors. So you have to overlay the data with the reality of what the client is comfortable with.”

Open Advice is a non-regulated digital advice service set up by Villis and First Wealth’s other co-founder Robert Caplan using Seccl technology and open banking.

Villis and Caplan, along with the two other of its four employees, are all shareholders in the business.

Back in June, First Wealth announced the creation of a new company, called Thrive Money, to help young people grasp the basics of financial planning by providing “low-cost” guidance.

Thrive Money was co-founded with Zanna van Dijk, a Forbes 30 under 30 lifestyle influencer with nearly 400,000 Instagram followers.

ruby.hinchliffe@ft.com