Wealthtech Software Development Services

Wealthtech is a Fintech niche that combines technology and wealth with the idea of improving personal and business wealth management strategies. Wealthtech software solutions (e.g. software for financial advisors) use modern technologies, including artificial intelligence, machine learning, and big data to provide users with the most relevant financial information or advice. We can think of wealthtech software as a collective term for digital tools built to improve asset management and investment processes for individuals and small to medium-size businesses. These are the tools that allow making even minimal investments (e.g., double-digit dollars amount) as they aim to satisfy every customer's needs.

Here are a few latest trends in wealthtech industry, you can't overlook, according to the CBInsights State Of Wealth Tech Q1’21 Report.

• Record investments. Q1’21 was the most significant funding quarter in history. Across 86 deals, wealthtech firms raised $5.6 billion, which is more than 2020’s total year-end funding - $5.2 billion.
• Mega rounds drive the funding boom. In Q1’21 the wealthtech companies raised 9 mega-rounds (deals worth over $100 million). These rounds accounted for 83% of total funding.
• Retail investing led the growth. Funding of the personal finance and investing applications accounted for 6 of the significant 10 wealthtech deals raised in the first quarter of 2021. One of the most prominent deals refers to Robinhood, an online brokerage, which tapped $3.4 billion in funding, making up more than 60% of all deals in this period.
• Asia saw the biggest jump in funding. Funding to Asia-based wealthtech companies grew dramatically - a 2,893% increase in between Q4’20 and Q1’21. The wealthtech firms from this region managed to raise $449 million in the first quarter of 2021. Wealthtechs in North America saw a 562% increase from Q4’20, having raised $4.7 billion. And Europe-based wealthtech projects attracted $316 million of funding in the same period, marking a 170% QoQ jump.

The robo advisory market is growing steadily, and it is expected to reach $41.07 billion by 2027. This niche should generate a CAGR of 31.8% between 2021 and 2028. Such numbers aren't too surprising when considering the many benefits of robo-advisors usage. These are:

• Time and efforts savings. Robo-advisory software performs many of the essential steps in investing. You select the funds and assemble them into a suitable portfolio model, and robo-advisors take care of the rest. After the initial investment, they constantly monitor the investment, send you the reports, and make the necessary rearrangements if needed.
• Low minimum investment. Robo-advisors are great for small investors, as many of them require a law or minimum investment to open an account. Only a few of them have balances of over $25,000 as a requirement. However, some of these wealthtech platforms will offer you better services and lower prices if you have a balance over a particular amount.
• Good diversification. Robo advisors divide the users' investments within various exchange-traded funds (ETFs). At least several different ETFs are involved, but sometimes this number may reach 15 funds. So you can have hundreds of various stocks in just one portfolio, which enables excellent risk diversification.
• Transparency. With robo-advisors, you can get all the information you need and make an informed investment decision. You can easily see in which ETFs or individual stocks your robo-advisor invests and why. You can also get detailed and easy to grasp data on the strategy as well as about the costs. Robo-advisors also provide reports on the investment, so you can keep track of things easily.

If you require more information on robo-advisors, read our blog about robo-advisory software development. And if you are ready to start developing wealthtech software, contact us!

Below you can view some of the best wealthtech solutions grouped by type.

Robo-advisors examples

• SoFi is an American fintech company that wants to become a one-stop-shop for financial services - from insurance to robo-advisory.
• Betterment is an automated investing service that offers retirement and investment solutions for its clients.

Digital brokerage examples

• TD Ameritrade is an online brokerage that offers automated trading, self-directed brokerage accounts, education savings accounts, retirement accounts, and more.
• Tastyworks is a niche digital brokerage platform created for options traders.

Portfolio management software examples

• OWL Software Personal Portfolio Manager is a solution that allows investors to manage investments effectively by keeping separate accounting for various portfolios.
• Croesus Advisor is a comprehensive solution for professional portfolio managers built by one of the leaders in SaaS wealth management services.

Micro-investment platforms

• Acorns is a financial startup that allows users to round up purchases and move the change to the investment portfolio.
• Public.com is a fintech company that aims to disrupt the culture of investing by allowing people to make investments in stocks with any amount of money.

No two wealthtech apps are created equally, so there's no single answer to that question. The total cost of building a wealthtech solution depends on various factors, such as the type of software (do you want to create an investing app or a robo-retirement platform), the number of features you want to add, third-party API integrations, and even the development approach that your development team use.

One of the significant factors that influence wealthtech solution costs is the programmers hourly rate, which is often defined by developers location. The cost of hiring a fintech developer varies widely based on your outsourcing country, as well as the seniority of programmers. If you can easily hire fintech software developers in Ukraine with an hourly rate of $70 (senior specialist), hiring developers in London will be much more costly.