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Startups with robo-advisor products are failing to live up to their initial promise.
As solutions proliferate and consumer adoption remains slower than expected, many firms are re-examining and updating their strategies to survive.
In a new report, BI Intelligence scopes the current market for robo-advisors, providing an updated forecast through 2022. In addition, we explain the different types of robo-advisors emerging, detail how startups and incumbents are working to ensure the success of their products, and outline what will happen to the market over the next 12 months.
Here are some of the key takeaways from the report:
- BI Intelligence forecasts that robo-advisors — investment products that include any element of automation — will manage around $ 1 trillion by 2020, and around $ 4.6 trillion by 2022.
- Startups offering robo-advisors are struggling to acquire AUM due to overcrowding in the global robo-advisory market and lower than expected customer uptake.
- Incumbents are rolling out their own robo-advisor products, a trend we expect to pick up in the period to 2022.
- North America remains the leading robo-advisory market, but we expect Asia to catch up and outpace the region in terms of AUM managed by robo-advisors in the period to 2022.
- There will be a winnowing of the startup robo-advisory market as only a few firms remain stand-alone, while incumbents looking to launch their own products will profit from purchasing the technology of startups that have fallen by the wayside, at low cost.
In full, the report:
- Provides a forecast for the volume of assets robo-advisors will manage by 2022.
- Outlines the current robo-advisory landscape.
- Explains how startups with robo-advisor products are evolving their business strategies.
- Provides an outlook for the future of the robo-advising industry.
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