How to Make Investing Engaging Using AI with Vinay Nair
ChatGPT may have recently taken the world by storm, but artificial intelligence is not new. AI’s greatest strength has always been its ability to personalize information in seconds. With the advancement and accessibility of technology, these AI solutions have become popularized, even in the financial services sector.
Vinay Nair is the Founder, Chairman, and CEO of TIFIN, a company that makes investing engaging by using investment intelligence, data science, and technology. With TIFIN, Vinay hopes to manifest the future at a faster pace and build a collaborative experience between humans and AI.
In this episode, Vinay talks with Jack about how TIFIN is disrupting wealth tech, Vinay’s predictions for the industry’s future, and the importance of innovation even in times of financial hardship.
What Vinay has to say
“I think a lot of what we are talking about at the end of the day will be a human-AI collaborative experience.”
Read the full transcript
Jack Sharry: Hello, everyone. We are pleased you’ve chosen to join us this week on WealthTech on Deck. We’ve been so fortunate to have nearly 100 guests on our show over the past two years from all walks of FinTech and wealth tech, where we explore the confluence of digital and human advice. Today, we’re going to look at it from the perspective of someone who has spent a lot of time thought and energy on venture capital, private equity, entrepreneurship, and plain old good old disruption. So our guest today is Dr. Vinay Nair. And he is the founder and CEO of TIFIN, a FinTech platform that drives personalization for wealth. Using AI and investment intelligence. Tiffin operates a collection of fully owned subsidiaries. We’ll hear some more about that, from Vinay in a moment, those subsidiaries are in wealth and investments that are shaping the future of the investor experience and outcome. I would say he is also founder and chairman of 55IP, which was successfully sold to JPMorgan Chase. So Vinay, welcome to WealthTech on Deck.
Vinay Nair: Great to be here, Jack. Thank you.
Jack Sharry: So Vinay, please share with our audience, I’ve read up on your bed, you’ve got a fascinating background, it’s academic and then some. So share with us if you will, your background and what led you to form TIFIN.
Vinay Nair: Happy to. My background Jack was in academia. So I’m a recovering academic that’s found their way to wealth. I started my career teaching full time at the Wharton School in the finance faculty. I taught courses on private equity, venture capital, entrepreneurial finance, that a bit at MIT for a few years as well. The engineer in me, which was my undergrad degree, had to build things ended up down the entrepreneurial path as a result, my first foray into that was really running a quant hedge fund. And that quant hedge fund really gave us a window into allocators which were RIAS multifamily offices, which really made us realize that there’s a significant gap in the type of solutions, sophisticated solutions that institutions get. And that gap between institutions and the retail world is pretty significant. Which is really what got me into starting 55IP, and from 55IP to TIFIN. And we’ll talk more about TIFIN. But that’s been the journey that led me here.
Jack Sharry: That’s great. That’s great. So tell us about TIFIN. And I’m thinking I have a good idea of talk to some of your colleagues there read up on you a bit. But from what I read in here, it’s a very dynamic, very exciting company. And you constructively seek to disrupt and help our industry move forward. So tell us about TIFIN, what you’re excited about what you’re working on, tell us a little bit about what you do it at a very high level.
Vinay Nair: I think of TIFIN as an innovation platform for the industry, by industry meaning wealth, wealth, investments, insurance eventually, things that an end individual worries about to get to a better financial place, security, aspirational protection, all of that bundled up together. So TIFIN to me is really a platform that aims to bring together deep knowledge of emerging technologies, which is moving really fast, and a deep knowledge of the industry, together, create solutions, create products to help the incumbents move towards this future in a faster pace, more efficient pace. So at a very high level. It’s really an innovation platform where what makes it exciting to me, and I think to the people here, as we believe we are really helping the future manifest at a faster pace. I think that these things are inevitable hopefully TIFIN can make it happen sooner rather than later. Now, specifically, what this different started off really as a venture studio. And that really means that we started founded or co founded a collection of companies in the space. When I started, Jeff and I had already started 55IP, we had brought in a great CEO. I’d moved to the founder executive chairman role. And what stood out at that time to me was there were many points solutions in this industry. And 55!P was one point solution. And then there were platforms that really were built decades ago and as a result, were encumbered, encumbered with tech debt.
Jack Sharry: I’m sorry, Vinay Did you say tech debt?
Vinay Nair: That’s right.
Jack Sharry: Explain. I love the expression. But explain I think I know what you mean. But just to be clear for our audience.
Vinay Nair: For most people who have actually tried to build a platform which uses technology, you know how difficult that is to refer act of things and rewrite things and go back and disassemble things that have all been batched together to create what exists today. And to do this while you have real clients and real customers, it’s like switching from one running horse to another galloping horse.
Jack Sharry: Yes, my expression is changing the oil while flying the plane.
Vinay Nair: That’s right, which meant it’s a real issue. This is why a clean sheet of paper is a massive advantage, especially in times of significant disruption, and technology. So I felt that is setting at a time and place 2019, early 2019, where we could create many of these points solutions for the industry and be a platform of point solutions, if you will, yes, that’s a different started, I can walk you through more about the evolution. But just to give you.
Jack Sharry: Let me dig in, again, for our audience who are largely professionals that are dealing with this sort of issues, I refer it in the common language of connecting the dots, taking the different points, solutions, and connecting them coordinating them, which is beyond integration, at least in my definition. So talk a little bit about that. Maybe describe some of those points, solutions, and then maybe a little bit more about how you connect and coordinate those various capabilities.
Vinay Nair: Absolutely. So we started in 19 and 20, we had about 10 companies in the studio model. So think of 19 and 20 as defense studio phase, end of 20 We ended up selling 55IP to JP Morgan, and we also ended up spinning out one of our companies called Parallel Technologies, which is a modern fund administrator. Both were great outcomes. Obviously 55IP has been good for JPMorgan, good for the team, good for us. And Parallel Technologies today oversees about 6 billion in assets under administration profitable growing more than 100% per year, the remaining companies we decided to coalesce or unify them to create three platforms. Today TIFIN operates three platforms. One of them perhaps the most relevant for your audience, Jack is TIFIN Wealth, which is focused on wealth enterprises and advisors. The other two one is focused on asset managers and helping them distribute in a more modern manner. And the third is a consumer focused platform called Magnify. Where think of this as GPT meets advice meets brokerage, you can answer very, very specific questions in a personalized way, because we regulated and you can trade on those or invest on those through the brokerage capability. So those are the three platforms we have today, we still have different studios, as a separate subsidiary. And we are launching our cohort to within different studios as we speak.
Jack Sharry: And tell me about that when you say your launching your cohort. What does that mean?
Vinay Nair: So these 8 to 10, companies that we had started in 19, and 20, we’re really Cohort One, and they’ve become sale and the spin off and three platforms go hard to we’re creating new businesses around themes, new themes. For example, insurance is an area that we think needs to get modernized. AI assistance for the world of finance, where we have significant knowledge base, we think, could be an interesting area. So we’re working with some of our partners, and they’re combining health and wealth issues is an area where we think it’s a team we care about. So these will all be new themes where we’re going to launch new companies as part of different studios. Act Two, if you will.
Jack Sharry: And tell me a little bit about if you do whatever you you’re comfortable in terms of with some more specificity, because I get the headline, what does that look like any examples maybe that are out and publicly available, or people are utilizing that just to give a give people a frame of reference as to what this plays into it? Clearly, you’re have a disruptive mindset, you’re looking to solve problems using AI, it sounds like as a critical piece. I’m sure it’s all API driven. So talk a little bit about how that plays out how that manifests into a product.
Vinay Nair: Absolutely. So the core asset, the core edge, the core value prop, I think is really data and AI. It’s not that we bring is data and AI. And if you’re not building things, or don’t think have the best expertise in the industry to build things for automation, for example. So we don’t do things that often sits between the advisor and the custodian within the wealth platform. Let’s call all of that middle office back office automate workflow automation. So typically, we don’t do any of that stuff, but then defend well, that’s one of our divisions. Our core mission is to help our clients or relevant price clients increase their organic growth and And to deliver the end users very personalized, engaging experiences. So there are a few different tools you can use to drive that organic growth, one of which is data science and signals growth signals. Second is act on those growth signals through marketing, communication, personalized marketing, communication. And the third is to convert those prospects with very personalized proposals. So the way today, the wealth enterprises work with us, is often they start with one of these three things. We have clients that use just data science, or clients that just use the communication automation engines, our clients that just use a personalized module, but they work best when they’re speaking to each other. For example, we have clients today that have combined things. So you use the data science capabilities to prioritize, let’s say, a list of prospects you’ve got on a webinar. And then you use the communication engines automatically, to nurture them through maybe automated email campaigns. And let’s say one of them, wants to actually talk to you about their goals and risks and what matters to them, you can build a personalized investment proposal that brings all of these things together, not just a goal, not just a risk, not just the current portfolio. So that suite is really designed to drive growth. And the data is continuously flow. So there’s real time feedback loops, which improves the data science. And that would be one example of where we think the personalized proposals is really just add on. The communication is just an add on. The core value prop is the data and AI, right?
Jack Sharry: So let me see if I can summarize make sure I’m hearing this accurately. So at least on the front end experience, you can be used from a prospecting standpoint, using available data and sounds like you refine it as you go, you get to understand what the what a prospect looks like, what was the likely candidate for purchase of whatever the service might be? Then you have communication that’s geared toward that the people that are looking for what, what’s being offered, and then you follow up with a proposal. Is that accurate? That is and what happens after that? Do you get into then make recommendations and follow through in terms of implementation? Or do you turn that over to someone else?
Vinay Nair: So we have integrations with different platforms. And that’s when it flows into there. I think we also had the ability to, you know, stay connected with the custodians, and we have the ability to do some rebalancing. But our goal is really to hand that over to integrations as much as possible.
Jack Sharry: Interesting. Another example that caught my attention as a topic, I think that’s just so underplayed sounds like you’re working on it, or have developed something around health and wealth. I think such an integral part of the wealth equation is someone’s health and their longevity. And they’re just what they have to do deal with in terms of cost and all the rest of that explain what you do there. That sounds intriguing, because there’s not a lot out there on that topic.
Vinay Nair: Yet, Jack, I think it’s early days for us. But precisely because of the gap between I think the need and the supply, is why we are picking that as a theme within different studios. I’ve personally invested in some startups that are doing some interesting things, you know, one I do a shout out for is a firm called NES where they’ve launched a credit card where all the rewards and benefits are in the wellness space. It’s a clever little idea. I think they’re doing well. But I think overall, whether it’s young or older generation, I think everyone cares about either proactive or reactive health management, which is obviously a big part of your finances, but also a big part of wellness. And we think of wellness today as not financial wellness and, and non-financial wellness. We think of wellness as one coherent concept. And we see a future of this industry, really catering to that concept more holistically.
Jack Sharry: So explain that. I think I know what you mean. So it’s not just financial wellness, or personal health, wellness, but it’s that it’s that combination, is that my hearing that right?
Vinay Nair: That’s right, let’s take the example in the context of the workplace. And I think that might be more helpful for the listeners to connected there. So we are building a platform of really actionable, personalized recommendations, that brings together all the employee benefits that someone has. So you could start with saying, hey, I want an emergency savings account, a health savings account, student loan payment assistance module, I want something that improves my credit rating. Of course I want the 401 K plan and the right retirement in there. Around that there are many things that are, let’s call it out of plan. And today, our industry hasn’t done a good job of bringing all of this together for that employee and guide them through when you do what, based on your preferences, your life, your health situation, and other things. Yes. So we have put together an actionable platform where you can guide someone through this. And the key thing is actionable. Because if I say, Hey, do you have money saved for the next year or two years in case something happens? And the answer is no. And you say, your employer is willing to add 10% of your savings, click here, get going open an ESA that ability today often is very modular, again, if you see the industry, you will find as wellness platforms, that is just content. It’s not really actionable, or personalized, then you see some point solutions FinTech companies that have struggled historically, trying to sell into the space. So we brought it all together. And we recently signed a deal with Morgan Stanley at work, as an example of taking one of these things to their corporate clients. Yes, we believe that, at the end of the day, this will help both the wealth enterprise and getting leads from the workplace and the end user in a better outcome, which is exactly the two things we think about when we build solutions.
Jack Sharry: So it’s interesting, I’ve written and talked and have made the case that the future of wealth management resides in workplace retirement. This leading to a question What do you think about this? I have a hunch, I know the answer, but I’d love to hear your comments. But the point is that everything started on the wealth management side, there’s a lot of activity, we tour at Morgan Stanley on the wealth side, we’re also work with them on the retirement side or the workplace side. But it’s all coming together. This is convergence of wealth and workplace. So talk about that, because it sounds like you’re building tools for that to basically connect those dots between whether they wherever they started, that’s all part of the very publicly stated Morgan Stanley strategy. Wherever you start with, it’s the trade or it’s through your Empower relationship, or your basketball relationship, parametric relationship for that matter. It’ll all lead back to how you pull things together, and take a more holistic view. So probably singing your song with what I’m just saying. But please comment, if you would about where do you see this going? Where is it? Now? Where do you see going from here?
Vinay Nair: Very aligned with that view, Jack, as you’re probably not surprised? I am. But if you think about why did we create a consumer platform or wealth platform, and we’re working on this workplace platform, because at the end of the day, these are the three places people have the money, they have the money in a self-directed account, they have the money with an advisor account, they have the money in the workplace account. And we think in the future, it’s the same individual, these are not three different individuals. You know, historically, we’ve thought about our world as self-directed, advised. But it’s the same individual that we think will have some money in a brokerage account, some money with an advisor, and of course, some money in the workplace. So first, for us, this was really about how do we provide the technology, the intelligence, the personalization, that is needed in these three platforms to touch this individual. So we don’t have advisors of our own, we don’t have products of our own. So we felt we could do this in a way that supports the industry, modernize and these three venues of these three venues, when you think about which venue is the most ignored? It’s the workplace. And sure, there are many brokerage accounts with interesting experiences that we think, you know, that’s problems because most of it is focused on access, not on knowledge. That’s where magnify comes in. There are many wealthtech platforms, we think that most of them are focused on middle office, back office and, and advisor workflows. So that’s where we come in and trying to help the data science and the engagement side. But workplace, I mean, there is not much there. It’s a wide-open space, and most wealth enterprises that will benefit from them, not the Morgan Stanley’s they’re too big, but most wealth enterprises that get leads from there, just have no capability to build platforms like this. And so they end up doing small things, which are, you know, not very effective. And we think the lead generation from the workplace is a huge opportunity that really will go to smaller wealth enterprises, and they lack some of these capabilities to connect the dots. Right, so broadly very bullish on that space, especially for the non-Morgan Stanley’s and non-empowers and non-jpm, if you will.
Jack Sharry: Yep. You’ve raised at least a dozen issues I’d love to pursue, but we try to keep our show to a half an hour. So I’m gonna ask one more question before we, we close up, we probably are gonna go a little over. But this is fascinating. You mentioned opportunity in the annuity and insurance space. Tell me a little bit about what your thoughts are there.
Vinay Nair: That area has been really a discovery for us, as we’ve been building TIF in the last four years, the from the consumer side, you find a massive demand from the consumers that they want their advisors to help with insurance choices. On the adviser side, there is clearly a lack of number of advisors to provide that help has very little less than 5% based on some metrics. So we know that protection is important for the individual, not just investment to get to a goal. And in fact, protection helps the aspirational side, we know that the advisor has various constraints that prevent them from doing a good job on that. So at the same time, and you look at the insurance providers and their distribution strategy, we know they want to get more direct to consumer, and they have to make their agent weight distribution more efficient. So when you put these three dots together, it’s very similar to how the asset management industry was think ETFs mutual funds, yes, perhaps, you know, two decades ago or a decade ago. So we think the evolution of what has happened there. And Betterment has played a role for asset manager, wealth manager and investor connectivity. We can also help with insurance products, agents, and the end investor connectivity.
Jack Sharry: I think you have a tiger by the tail. My friend, Dr. Nair, this is good stuff. I have a million more questions. But respecting our time constraint, let me just ask you a quick question which you’ve got sort of laid out. But where you see the world going, I assume it’s more of the same and pretty well broken down, as you’ve shared, but please, anything that you’d like to add terms, the clarity of your message so far?
Vinay Nair: I mean, I see the world is already in the middle of a fascinating phase of innovation. I mean, GPT is part of a cultural phenomenon. Now. There are, yeah, that was amazing. Six months ago, no one knew.
Jack Sharry: Right? You did? I’m sure.
Vinay Nair: It’s to me, I think we are at a very exciting phase of innovation. Sometimes it’s difficult to see when you look outside and banks are burning up and you know, rates are going up. Yeah, but it’s exciting times to do. And I think a lot of what we’re talking about at the end of the day, will be a human AI collaborative experience.
Jack Sharry: Couldn’t agree more. As we do about this time of the show, what are three key takeaways you’d like to share with our audience based on our conversation so far, based on everything we’ve been talking about?
Vinay Nair: Jack, I’ll leave the audience with two things, actually, not even three to keep it. The first is, as we’ve been saying, I think we’re in a fascinating phase of innovation. And if you’re running a business, it’s sometimes tough to allocate capital to innovation, especially in moments when you feel like you have to survive. But that’s a little bit like cutting down on internet spending in 2001, if you want to build a longer-term business. So I think that the ability to reallocate to innovation from other things, I think, is going to be a key differentiator of firms that thrive. And firms that don’t be at this very unique phase, where I don’t think we’ve seen phases, which have been both economically difficult and innovation oriented at the same time. So it’s probably the first time you’re seeing something like this and a long time.
Jack Sharry: For our industry, I would always say innovation dependent. In other words, to compete, you’ve got to innovate. We see it happening. And there’s a lot of craziness going on all around us. But just based on what you’re saying, I know what we experience. At least the leaders get that you got to innovate, and the others are catching on, they’re gonna catch up quick.
Vinay Nair: Exactly. And that leads to the second point, which is how do you do that fast? And how do you do that cost efficiently? And I believe the answer is large firms cannot do it fast and cost efficiently in house in I spent quite a bit of time, but some of them and I think they’re just not set up to experiment at low cost, high iteration speed. And that’s where I feel that you need innovation partners, whether it’s different or someone else. But I feel that you need to have a partner, which is really a different talent pool, a different mindset, a different cost of failure. And can you produce something in six months, which actually works? Can you produce something with less than a few million dollars that actually works? That is of a three-year plan and a five year plan are gone? So I would say in thinking through how you want to bring innovation into your business, you actually have one more To have to think outside your business to find the right linkages and partnerships.
Jack Sharry: I could not agree with you more we spend at LifeYield, we spend as much time consulting in quotes, as we do in building because there’s a lot of education they know they want need to are highly desirous of innovating and they don’t know where to start. They don’t know who knows it. And it generally is I’m sure you find doesn’t reside within a large organization. Absolutely. Well, this has been fascinating. And we’d love to keep going. And maybe we’ll do this after our recording is done. We’ll chat a little further. This has been wonderful tonight. So as we always do, at the end of our show, we’ve had a wonderful conversation, I’m always interested in more of the personal side, as well as what you do day to day. So what is something you do outside of work that you’re particularly excited or passionate about, that people might find interesting or surprising?
Vinay Nair: I don’t know that interesting or surprising. But two things may be one is, you know, I had three young kids, and I find the weekends. Very exciting. I look forward to the time with them. As we all know, that’s limited. And they’re 10, 8, 6. It’s energizing in a way that I think very few things are. So I would just point that out. Yeah. The second is, I started on a journey about 10 years ago now, which, at a very high level, let’s call it spiritual. So I have been getting deeper and deeper into that with meditations and solo nature retreats. Being in Colorado, Boulder is a fascinating place for that as a place near Scout Crestone. Where often I’ve taken a team, we do solo two- or three-day retreats where we stay in a confined area, no food, you know, nothing to distract you and no reading, no writing, no electronics. And it’s very clarifying when you come out of it. So it’s a journey, which I think is something that I hope to get deeper into.
Jack Sharry: That is both fascinating and surprising. That’s wonderful. Thank you. So for our conversation today, Vinay. Thank you. This has been wonderful work. I think we may have to have you back. There’s much more to talk about. And for our audience. If you’ve enjoyed our podcast, please rate review, subscribe and share what we’re doing here at WealthTech on Deck are available wherever you get your podcasts. Thank you again, Vinay. It’s been a total blast. I really enjoyed it.
Vinay Nair: Thank you, Jack.