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Middle market investors get cut diamond offering

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This week saw the launch of a new wealth management platform, Rosecut, powered by artificial intelligence, and focused on the affluent middle market investor base.

Qiaojia Li (pictured), co-founder and CEO of Rosecut, who was most recently Co-Head of Asia desk at Coutts Bank, says: “Six years ago I started working with investors who could give me GBP1 million to start a relationship and realised that, nowadays, these types of clients have been left behind by traditional private banks.

“There is, what we can call, the middle market, people with GBP100,000 to 2million in investable assets. What these people need is very different from retail and high net worth investors.”

Li’s business partner and fellow co-founder is Chief Technology Officer Gustavo Silva, who specialises in technology and artificial intelligence which supports the Rosecut platform.
It is building a supervised learning algorithm based on the field experience of its financial advisory team, using reinforcement techniques that will allow the algorithm to provide a high-quality bespoke financial strategy for all users under the supervision of human advisers.

Li says: “High net worth investors with GBP5 million plus can afford the expensive full scope services, the white glove face to face services, whereas for the affluent it doesn’t make sense.”

These affluent investors, Li believes, can access banking services which may advise on products available, but lack the implementation part of the process.

“An IFA can do a good job for your planning but you don’t have control of the end investment or you go into funds in a DIY way and lose yourself blindly without an overall financial plan.

“What is unique about Rosecut is that our type of service doesn’t exist for investors in the middle market, the aspiring affluent, or slightly more affluent.”

Rosecut is looking for the clients who aspire to create bigger financial assets to leave as a legacy for their children or to fulfil their dreams. The company estimates that the middle market is a market of approximately nine million UK individuals, representing total investable assets of GBP3.2 trillion.
 
Rosecut’s digital solution is designed to offer client access and monitoring at all times, while its proprietary AI replicates bespoke adviser sessions that might be experienced in private banks, based upon genuine private banking experience and knowledge, delivered through the platform in real time.

The service is designed to bridge the gap between the retail robo-advice type offering and a full private bank offering and there is also a club, the Rosecut Club, which allows members to connect and share experiences.

Li says: “We are building the service of a private bank, with the cost-efficiency and scale of digital delivery.

“The retail market has excellent digital access to solutions that are tech-based and easy to use, but these solutions lack the sophistication to manage significant sums. The high net worth individuals and beyond, meanwhile, have great face-to-face services, albeit quite expensive.”

Li reports that new clients are coming from her personal network and word of mouth referrals. The Rosecut Club offers a blend of online and offline events and has held its first offline event, the Rosecut Introduces seminar, with entrepreneur and investor Benson Tam, the first institutional investor in Chinese e-commerce company Alibaba.

Rosecut charges an all-inclusive 1 per cent charge for its services on the money that is invested through the platform. Custody and trading are provided by Dolfin.

The name, Rosecut, comes from the traditional diamond cut. “Rosecut is a traditional way of hand crafting diamonds,” Li says. “It’s our way of saying you are unique and you deserve a unique plan.”
 
 

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