MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Friday, February 8, 2019 New Day, New Roboadvisor ... New Funds? An ESG roboadvisor in California may soon be entering the mutual fund business, too. Doug Heske, CEO of San Francisco-based Newday, tells MFWire that he and his team are "absolutely looking" to launch '40 Act products. Meanwhile, they're working on some key distribution relationships and launching another version of their app. Heske and Newday president Alex Meek teamed up in 2016 and co-founded the roboadvisor, with a vision for "tapping into the universal sentiment of millennials and other investors who are focused on responsible investment." The idea, Heske explains, is to help individual investors align their "financial decisions to values and impact." To that end, Newday offers a mobile app (iOS and Android) through which individual investors can choose from different portfolios (in SMA form): a climate action strategy, a gender equality strategy, a clean water strategy, an ocean health strategy, an animal welfare strategy, a global impact strategy, and a fossil fuel-free global impact strategy. The strategies are broadly diversified and invested directly in about 40 stocks each (mostly mid-to-large cap). The strategies went online about six months ago; they're "approaching 500 individual clients" so far, (and thousands of app users) Heske says, and he expects Newday to have about $27 million in assets by the end of Q1. When the Newday team works on building mutual funds or ETFs, Heske says, they "would do a subset" of their existing strategies. Next up, within the next two months, will be the launch of a web-based version of Newday's app. "The web-based app will be the most advanced piece of our technology once it rolls out," Heske says. Though Newday does not have its own sales force yet, the team has received many inquiries from RIAs looking to use Newday's ESG strategies, Heske says. "We deliver them to interested parties outside of the direct-to-consumer platform as a model," Heske says. The Newday team is also in discussions with "three major broker-dealers" about using the strategies. And Heske is eyeing the retirement plan market, too. (Our sister publication, 401kWire, covered Heske's interest in the DC I-O channel.) Looking ahead, the Newday team will be launching a flagship strategy focused on "stakeholder capitalism," meant as a counter to a more short-term investing mindset, Heske says. They're also working with MasterCard on launching what Heske describes as a "socially responsible check-less checking and savings account." Newday started out mostly self-funded, in addition to some capital from a nearby family office, Heske says. Now Newday's backers include two smaller venture capital firms and all of Newday's advisory board members and directors, and Heske expects to do a series A funding round by the end of 2019. Yet the firm is "still largely owned by employees," Heske says. The firm is also structured as a B corp, so they give five percent of their revenues to charities. Printed from: MFWire.com/story.asp?s=59307 Copyright 2019, InvestmentWires, Inc. All Rights Reserved |