Kristal.AI is looking to ”Shopify” wealth management as it expands to the Middle East and India with its unique technology platform. e27 spoke with Asheesh Chanda, Co-founder and CEO at Kristal.AI for a discussion of what makes their proprietary technology and wealth management team stand out in the marketplace for personal wealth management services.
Age of digital transformation
Asheesh feels that private wealth management services are increasingly becoming digital as companies like Kristal.AI apply technology to innovate new engagement models. “Wealth management has been a human-intensive business. While the managers used tools for risk management, personal finance, and KYC, their customers rarely had an experience that tech-driven. Technology was used mostly to deliver services but not personalise services,” explained Asheesh.
The biggest issue, according to Asheesh, is that without digitally enabled service models, personal wealth managers are limited in their capability to deliver individual and personalised services to multiple customers.
“Now, customers are asking for real-time access to their portfolio and ability to make their own investment decisions,” he continued. With tech-savvy customers demanding digital access to monitor their wealth investment portfolio, “this has made many wealth managers invest in building their own customer portals,” explained Asheesh. “But this is not easy, as they lack resources and the knowledge of technology providers,” he added.
Management fees have been reducing over the years, as advisors play on fees to attract new clients to them. To make the economics work, they acquire multiple clients, but this makes it hard for them to offer personalised services to their clients. Hence, they are investing in tech to be able to provide a consistent experience to all their clients. But this is easier said than done as most advisors or wealth managers lack the resources or the skill set to build a tech interface for their clients.
That is where Kristal’s platform comes in. As a digital proprietary wealth management platform, Kristal.AI can offer a single platform that solves all the digital needs for private wealth managers. Asheesh states that “Kristal is trying to be the digital platform for wealth managers with all the tools like risk management, trade execution, financial planning, and CRM integrated into a single offering. We are trying to Shopify the wealth management space.”
Achieving growth through Channel Partners
When Kristal entered the India market in early 2020 with the model used in Singapore, they realised they were competing with personal financial advisors rather than private banks. In a market that is driven by long-standing relationships, these financial advisors had already earned the trust and confidence of their clients. Weaning these clients away was hard and time-consuming. Partnering seemed a better way to move forward. Kristal believed that in India where clients have high trust in their personal wealth managers, joining hands with these advisors as channel partners to leverage and combine that trust with the tech capability of Kristal is the right growth strategy.
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This is where Kristal focused its channel partner strategy — helping traditional family wealth managers onboard their clients to their digital platform. The strategy has been an unqualified success since Kristal launched its Channel Partner business in mid-2020. In 12 months since launching their ‘Shopify’ model, partners and clients already account for 10% of the AUM on Kristal and represent the company’s fastest-growing business segment. Kristal has onboarded more than 75 family offices and wealth managers, managing around $10 billion in client assets.
Asheesh explained how they work with partners: “Wealth managers subscribe to our product free of cost and onboard their clients on the Kristal.AI platform. Partners can customise their fee models and product offerings based on client needs. Kristal charges a certain platform fee and passes the balance to the partners.” Aligning with the established practices of traditional wealth managers, Kristal provides them with an all-inclusive tech platform.
Empowering personal wealth managers
Traditional wealth managers are thus empowered to continue to operate their traditional fee models and product offerings while focusing on achieving scale through client acquisition. “Kristal saves them from making investments in tech and allows them to spend their time acquiring and servicing clients,” says Asheesh. Apart from saving them the cost of building their own technology platform, Kristal’s platform enables partners to deliver a private banking experience that is more transparent and personalised, thanks to its AI-enabled advisory.
For Kristal’s channel partner customers, the offering continues to provide the same benefits: investors will be able to access institutional products just like those offered by private banks but at a lower investment ticket size. “As a customer, you can get access to the widest range of premium investing products and advisory services at super low ticket size. There are zero account opening and account maintenance charges,” adds Asheesh.
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A channel partner growth model nicely aligns with the overall mission of Kristal.AI to democratise private banking and get institutional products within the reach of more investors. As partners experience the benefits of working with clients on Kristal’s technology platform, the company hopes that more and more financial advisors will recommend Kristal.AI to their clients. This model will allow Kristal.AI to rapidly grow within the large and affluent segment of HNWI clients based in India and the UAE and realise its vision to be among the top 10 wealth managers of Asia
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This article is produced by the e27 team, sponsored by Kristal.AI
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