The Crysply News: Is Big Finance Undisruptable?
We can all agree that the last decade of fintech has given birth to many great companies, yet the traditional incumbents continue to thrive. By targeting underserved markets fintech companies have mostly expanded the market but have not materially changed it. The next decade of financial services should fundamentally change the paradigms and business models of how traditional financial services operate.
Will the next decade of fintech be able to knock out the big banks? Or at least one or two lines of business from them? Will we be able to inject competition back into financial services? Mutual funds, indexes and generally passive investing have been untouchable for the past decade, showcasing very little innovation. Some may argue, myself amongst them, that the last true disruption in finance had been the index funds almost five decades ago.
After collecting data from our potential users and amassing hundreds of sign-ups to our waitlist along the way, we found (as shared in last weeks newsletter) that the number one pain point for users is losing money in the stock market. This week we tested messages around which HOW resonates with our potential customers. We tested a variety of micro-messages and saw the two of them outperformed the rest: automated short-hedging strategies and a layer of algorithmic trading on-top of your regular stock-picks.
This further validates our initial assumption that retail investors are hungry for a new type of financial offering. One that allows them to make their own decisions in the stock market while investing responsibly and optimizing for long-term gains. In other words, our users are looking for the safety of index funds with the choice of active stock-picking. With that validation in mind we decided to give our ‘Cryspified Position’ a temporary name: SCAF: Stock Centric Algorithmic Fund. Our users pick a stock, and Crysp builds the SCAF around each and every stock-pick. The algorithmic piece of the SCAF rebalances it’s holding in real-time to match not only the macro conditions around your specific stock picks, but also the additional SCAFs or even the ’naked’ equities in your portfolio - all to create the perfect balance of risk/reward.
We’re closer than ever to launching our MVP, and I couldn’t be more excited by how it’s coming along as we continue to progress and test on all fronts: algorithmic strategies, product, marketing and much more
It’s the beginning of the end for traditional finance #cryspified