Wealthica is an aggregation platform that allows investors to see all their investments in a single dashboard. Each day Wealthica connects to your financial institution and retrieves accounts balances, positions and transactions. With Wealthica you get a consolidated and unbiased view of all your investments, and you can compare fees and performance of your different financial institutions.
Wealthica has built its own aggregation engine and currently aggregates financial data from over 30 Canadian institutions.
How did Wealthica start and where did the idea come from?
Me and my two co-founders share a passion for investments. The 3 of us realized we had investments spread across 10 different financial institutions, and we found we had no way to track our entire investments portfolio, no way to quickly see our current net worth, and no way to track our fees and compare those fees across the different financial institutions.
We quickly built a smaller version of what would be Wealthica and let other use it. We immediately started to get some good feedbacks and all of a sudden it began to look like a real business opportunity.
Wealthica connects to financial institutions and saves transaction history. How does the start-up connect to the different financial institutions?
Most of the financial institutions in Canada are closed and don’t offer a simple way to share your financial data with third party applications without sharing your credentials. For most of the institutions we have to ask the user for their credentials and retrieve their data through web scraping. Robo-advisors aren’t much better at making investors data available. The only Canadian robo-advisor with an API is Wealthsimple, but its API is incomplete and inaccurate which make it unusable for us.
Thankfully some institutions like Questrade and Interactive Brokers have APIs which makes perfect secure read-only integrations in Wealthica.
We would like to see more institutions adding APIs. We’re trying to work with the institutions so that they provide APIs, but unfortunately most of the time are told this is not a priority to them.
Canada is lagging behind the US and Europe when it comes to investors owning their data and allowing them to make that data available to 3rd parties programmatically through APIs.
What sets Wealthica apart from your competitors such as Mint and other traditional financial tools?
Mint is good for tracking regular banking accounts, credits card, or setting a budget, but is very poor for investments. I like to see Wealthica as the “Mint for investors”. In the US there’s Personal Capital, but it doesn’t support Canadian financial institutions.
Also Mint and the other aggregators like Yodlee or ByAllAccounts have limited support for Canadian investments platforms. Wealthica is the first platform of its kind in Canada focused on investments.
Who can use Wealthica?
I think every investor should use Wealthica. You don’t have to be a savvy investor or to have multiple investment accounts to use Wealthica.
Some or our users have 1 institution in the platform and use Wealthica every quarter or every year prior to meeting with their advisor just to compare and ask questions to their advisors. Wealthica helps them better understand the numbers their advisors are reporting.
Do-it-yourself also use Wealthica to track their performance and to prepare their tax return.
Since Wealthica was founded in 2015, what are some of your achievements?
I think our biggest achievement so far is reaching the $500,000,000 mark in total aggregated assets. We started 2017 with $300M and were aiming for 1B$ by the end of this year, but we’re on track to exceed our goal and are now aiming at 1.5B$ this year.
Who is funding Wealthica?
So far we financed Wealthica ourselves. We might be looking at funding this year if we find the good fit.
Normally, people do not trust start-ups to have their bank account username and password. Why should customers trust Wealthica?
Trust is definitively the biggest challenge we have for onboarding new users. Most of the Canadian institutions don’t have a secure means for investors to share their data without entrusting us with their banking username and password so that we can retrieve their investments.
Everyone should be carefully before entrusting someone with their banking credentials. We understand this concern and we know it’s a legitimate concern.
Banks discourage their customers from sharing their bank account username and passwords. What do you tell people who do not want to share their username and passwords?
It’s important to point out there’s a misconception where some users think that some Canadian law prohibits them from sharing access to their investment portal. The truth is that it’s a decision from the institution they are dealing with. Investors have to start asking their institution to open up and offer secure APIs, and move to more open institutions like Questrade or Interactive Brokers.
We try to reassure our users by explaining that the risk is more of a privacy risk vs a financial risk, because most of the investment portals we support either require an additional level of authentication or to phone your advisor to execute transactions.
We’re also taking great care storing our users credentials. We have our own bank credentials stored the same way that we store the credentials of our users. We trust our system and think users can trust it too.
The way transactions are collected and the security concern varies depending on which financial institution you are using. As mentioned earlier some institutions offer read-only API that allow you to share your data with us without sharing your credentials. This is the ideal way to connect Wealthica to your financial data but few Canadian institutions offer APIs.
When credentials are needed, without going into too many details, we use a public-key encryption for encrypting the credentials and that we have strict policies in place which prevent our employees from being able to decrypt your credentials. For some institutions we have to ask you to answer a security question (ex. What is your mother’s maiden name) but we will we never store answers to security questions so someone getting access to the credentials would still need to find answers to your security questions somehow.
In addition to security questions, some institution supports a separate trading password or PIN that we never ask (among others Scotia, TD and BMO support trading PIN). For institutions that require the trading password (or PIN) it makes the process even more secure. We will never ask you for this PIN. Anyone with your credentials would have to find the answers to your security questions and if they find those then they wouldn’t be able to execute any transactions without the transaction PIN.
How much do you charge for your services?
Our dashboard is completely free to use for individual investors and it will remain free. We’re looking at offering paid add-ons and reports for higher net worth investors or family offices. 25% of our users are millionaires, and we think we can monetize the platform by selling add-ons and specialized reports.
We’re also making our API available to other FinTechs and software vendors to integrate Wealthica Canadian financial institution aggregation into existing financial softwares or platforms.
How does Wealthica find its customers?
Currently most of our growth is word of mouth. We have partnerships with institutions like Questrade and Interactive Brokers having Wealthica listed as a 3rd party partner that brings us a regular flow of new users.
One of our key initiative this year is to do more marketing efforts and to get more people to know Wealthica.
What’s next for Wealthica? / What do you see happening in the fintech industry in 2017?
A lot is happening in the FinTech industry.
For Wealthica, we have a lot coming. One thing that is very motivating for us is the launch of our add-on store. We will allow users to make their financial data available to third parties that will deploy add-ons you can enable within your Wealthica financial dashboard. We’re on a mission to open up financial data and make it easily available to third parties.
We’re watching what is happening in the UK and Europe with PSD2 , and are closely following similar initiatives in Canada. We want to be at the forefront of any regulatory changes around financial data in Canada.
What advice can you give entrepreneurs who want to venture into the fintech sector in the future?
My advice would be to focus on building your product and don’t get too distracted about the FinTech “bubble”. At Wealthica we’re very much focused on our product and our users, and we’re very careful about where we put our energy.
Is there any other important message you would like to pass across to readers?
Try Wealthica to track your investment portfolio and tell us what you think about it!
For more information, please visit the Wealthica website on https://wealthica.com/