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Nutmeg offers wealth management services to all

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Nutmeg, the first investment manager for individuals of almost any level of wealth, has opened for business.



Nutmeg is made for the modern customer’s needs, giving total control with minimum hassle. Nutmeg’s investment team builds and manages discretionary, diversified portfolios on behalf of its customers. All users have to do is set their risk level, their timeframe and their contributions (with a minimum lump sum of just GBP1,000). They can also open and transfer ISAs, start as many funds as they like and top up, withdraw or transfer their money at any point.

Individuals in the UK currently invest more than GBP500bn with fund providers. Nutmeg intends to target this market by offering a more flexible, straightforward and cost-effective approach. Whereas the average investment manager charges 1.36 per cent in fees, Nutmeg’s annual management charge starts at one per cent. By collecting nutmegs, a loyalty scheme based around referrals and pounds invested, users can reduce this to as low as 0.3 per cent.

Nutmeg will also appeal to consumers whose cash savings are declining in real terms due to record low interest rates. In a recent survey by Harris Interactive for Nutmeg, it was revealed that more people keep their savings in cash at home than invest them in stocks and shares ISAs. The survey also found that 51 per cent of British adults believe they do not have enough money with which to invest.

Tim Draper, an early investor in Skype, Hotmail and now Nutmeg, says: “Financial services is one of the few industries to have withstood the internet revolution. I’m convinced that Nutmeg is the right company to bring democracy and transparency to a sector which is ripe for reform. Most of the interesting businesses I invest in originate on the west coast of the US, so it’s wonderful to be part of such an exciting British business which has the potential to be as big as anything in America.”

Nutmeg founder and chief executive Nick Hungerford (pictured), who used to work at Barclays and Brewin Dolphin, says: “As an investment manager and private banker I had no way of formally helping out people who weren’t millionaires. While studying at Stanford Business School, surrounded by people who worked at companies like Facebook, Google and Twitter, I realised that the internet could enable this vision to make intelligent, trusted investing accessible to all.

“Many of the products traditionally provided by banks and wealth managers are being scaled back. This provides a great opportunity for companies like Nutmeg to put customers’ interests back at the heart of financial services.”

Nutmeg, which is regulated by the FSA, recently announced that it raised GBP3.4m (USD5.3m) in its second round of venture capital funding. The funding was led by UK-based venture capitalists Pentech and Daniel Aegerter, the Swiss chairman of Armada Investment Group. Other investors include Tim Draper and Klaus Hommels, a board member of Spotify.

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