menu

Snapchat Wants to Be a Financial Advisor to Millennials

Snapchat Wants to Be a Financial Advisor to Millennials
Advertising

The ephemeral photo platform is gearing up to develop Robo-Advisory technology

by Ido Lechner
  • 29 february 2016

Looking to further its outreach and expand into other industries, Snapchat is rolling out a new feature which seeks to hone in on its maturing millennial audience ready to take its next steps via strategic investments.

Using Robo-Advisory technology, which makes algorithmic suggestions toward developing and implementing customized investment strategies, the company wants to help its fanbase save for retirement. Though other social media platforms such as Instar and Twitter are rumored to be cooking up something similar, only Snapchat has confirmed development and is therefore considered to be at the forefront of this movement.

“The opportunity to deliver financial services for social media platforms is amazing and potentially disruptive, especially in its ability to engage a Millennial consumer set that’s still emerging,” notes Reginald Browne, head of ETF trading at Cantor Fitzgerald, in the Reuters report.

While Snapchat itself is rooted in its belief of short-lived content, with both users and agencies required to constantly renew their ‘snaps’ for continuous engagement, a move towards long-term investing would likely be the first time the company offered a more preserving service. Still, with over 100 million users at arm’s length and a mobile-exclusive strategy, if any platform could drive users to invest through social media, its Snapchat.

The rapid surge of large companies eyeing millennial investing and robo-advisory technology is no coincidence, with ETF trading reaching an all-time high of 2.98 trillion USD last year alongside the general growth of self-directed investment methodologies, wherein users can control the creation and implementation of an investment idea.

“The landscape for financial services has been heavily democratized by the rise of the ETF (exchange-traded fund), now social media platforms have the opportunity to democratize the accessibility and delivery of those products and advisory services,” says Browne.

But social media won’t be an exclusive point of access for first-time investors (though it will arguably generate the most traffic) — rumor has it that payment app Venmo is creating a functionality similar to that of Acorn, which automatically takes spare change from its user’s credit card transactions and invests it into suggested ETF portfolios for them based on risk appetite.

The wealth-management industry generally lends itself to accounts that hold larger sums with which to play around, but doesn’t tend to mesh well with those on a tight budget.

“Since millennials are financially crunched, account minimums and transaction fees just do not make sense for this customer. The traditional financial industry generally does not have a great solution for smaller accounts,” wrote wealth-management platform Vanare’s partner and COO Alexey Sokolin on CNBC. “Financial advisors have a limited amount of time, and it is hard to scale a business model serving a few low-asset clients. So millennials created a technology solution that is personal, customizable and accessible.”

Expect to see this technology creep into your everyday platforms, from social media to alternative payment methods. If you’re a seasoned investor, don’t be surprised to see changes in the way your go-to apps operate; they’ll need to make them to accommodate an influx of new users.

Snapchat Investing via Reuters

Teens taking selfies via Shutterstock

Advertising
  • | {{post.date_formated_today}}
{{post.author_display_name}}
  • {{post.date_formated}}
{{post.author_display_name}}
  • {{post.date_formated}}
Read More Read More Read More Read More
PSFK Writer {{post.author_display_name}}
  • {{post.date_formated}}
No search results found.