InvestiFi

Transcription:

Kian Sarreshteh (00:11)

All right, I guess we're jumping in here. So thank you everyone for coming. My name's Kian. I'm Co-Founder CEO of InvestFi. Excited to showcase our patent-pending investing from checking solution today. I want to first quickly remind everyone of something that Nathan from Anchorage said at the keynote this morning, and that's that every bank and credit union should have a digital asset strategy. And I'm excited to tell everyone here that with InvestFi's full suite of digital investment products, you can actually have a digital asset strategy embedded into your digital investment solution, which I'm excited to showcase today. So InvestFi has a full suite of digital investing solutions natively integrated into online and mobile banking. But before I actually get into the demo, just want to quickly zoom out and tell everyone who InvestFi is as a company. So InvestFi is actually the largest digital investing company that was specifically designed for banks and credit unions.

(01:05)

We've hit profitability and we're reinvesting back into our business in a big way specifically to support community banks and credit unions. We do not have a direct-to-consumer product, and we do not work in other industries. So all the assets and features that you're going to see, again, are specifically to support banks and credit unions, and we're 100% US based and we have twice as many digital banking integrations built than our next biggest competitor. The one I'm going to be showcasing today that you can see here might look familiar to some of you. This is Jack Henry Banno. I'm going to be showing this on the web view today, but if anyone wants to see an actual demo in the mobile environment or on a different digital banking provider, our booth is right back there and would be happy to do so. The first thing that I want to draw your attention to is how this can be accessed, which is just here a menu item.

(01:49)

And this can be called anything like digital investing, personal investment portal, what have you. And what you'll notice is this actually opens up in a single window in the same tab without popping me out into a new experience or a new window or a new tab. But we do present the user with a speed bump, having the appropriate regulatory disclosure that the user is leaving online banking and entering the investments portal. So InvestFi has a wholly owned broker-dealer and RIA to actually make this whole solution come to life. And what you can see here is that all asset classes, including equities and crypto (so for that digital asset strategy), all in a single UI. And what's interesting to note is we actually use the same law firm that Robinhood's used over the years to get the right regulatory guidance to ensure from a product standpoint that we could display all the asset classes in a single UI the way that we did, which is why we have these disclosures that you see here.

(02:47)

And for a user that has all three accounts being self-directed, stocks and ETFs—and that product, by the way, your users can invest fractionally with as little as $1. Our guided investing solution is our robo product with a minimum of a $20 investment. And crypto is one of the more interesting products that there's real data points out there that drives material ROI for your FI, which is, in the first quarter of this year, across multiple FIs that we've been live with across thousands of account holders, we've driven on average $5 and 31 cents per user per month for every FI that's actually launched this solution, which is huge ROI right there in itself and want to now show you what it actually... Oh, so markets are closed. Never a great time to give a demo. Luckily we have the actual demo environment here. So I'm going to show this in the demo environment.

(03:46)

And what you'll notice when the users actually go to make an investment, there is no Plaid connection. There is no need to transfer money to a third or fourth party brokerage or a third or fourth party crypto account. All the users do with our patent-pending investing from checking technology is select the deposit account they want to use to fund this purchase. So all the orders are fully funded. First thing we do is run a balance check to the core to make sure that the users aren't overdrafting, and assuming that they're not, we can actually execute this order. They can also do recurrent investments if they'd like. But when this order is confirmed, two things are going to happen. We're going to route this order through to the broker-dealer to fill this order. And in parallel, we're going to move $100 from my checking account here over to the GL at the financial institution and for sell order.

(04:46)

So let me actually click back now to again, the production environment here. This is with a credit union we're live with in Michigan right now who is offering crypto as well. And if I want to sell some crypto, I've got about $41 worth. All I do is indicate how much I want to sell and which deposit account I want to receive this money back into. There is no need for a user to manually trigger a transfer or a withdrawal. The concept of withdrawals in our opinion is very antiquated because all you need is a checking account, which every bank or credit union or most banks or credit unions in this room would have. And so with crypto, you can drive a new stream of non-interest income with these crypto transaction fees, which your FI actually gets to pick. And then whenever I actually confirm this sale, two things are going to happen here.

(05:34)

Again, we're going to route this order through this time to the qualified custodian on the crypto side to execute at a price in near real time, even though this cash is not going to settle until market close. And then in parallel we'll move the net proceeds—so $10 minus the transaction fee—from the FI's GL back into my checking account. I can actually do that. This is a production environment here. We're proud of our technology and that this actually does work in a production environment here. And so you can see that order's executed. And then for the financial institution, this is all dummy data, but we put a lot of work in to align the flow of funds both on the security side and on the crypto side. For the end users, it feels the same whether I'm buying crypto or I'm buying stock, I just use my checking account to do so.

(06:24)

And for the financial institution, we've automated the settlements and we've aligned the settlement processes here. So this is a good example, right? It looks like a multi-day trading period because crypto markets are 24/7, 365. And so the crypto trading period starts at market close and it ends at market close the following business day. And so all the settlements are managed here for the buy orders. We do an auto ACH debit from that GL to settle the cash of all the buy orders. And in parallel, we'll push back the money to that same GL for all the sell orders. Crypto and securities settlement processes are separated for regulatory purposes. And then for our guided investing product, it's a great way for your... again, we have the market's closed here, but I'll show you what it looks like in the actual demo environment. So we've got the user being able to have a passive investment strategy managed for them by a team of professional financial advisors that have pre-designed 15 investment strategies of these portfolios here.

(07:27)

And as these users invest into these portfolios, the value of the robo portfolios are going to build, which is a great new way for your FI to drive a new stream of non-interest income because we give back 100% of the Assets Under Management (AUM) fees to your financial institution. And this also acts as a lead generation tool for your in-house wealth management if you have it. Because most wealth managers do not have an integrated small dollar solution, which is how InvestFi is really bridging the gap between digital investing and traditional wealth management, all while keeping the idle cash waiting to be invested sitting on the balance sheet of your financial institution. Thank you.