Moneyfarm reveals assets under management as it eyes profitability

The European platform is expanding rapidly, having passed £260m in AUM but has clocked up another loss for the year.

The European platform is expanding rapidly, having passed £260m in AUM but has clocked up another loss for the year.

Digital wealth manager Moneyfarm has reached £260m in assets under management, making it the second largest platform in Europe.

The robo-advisor, another term for an automated investing platform, also reported that it has over 10,000 customers in the UK, where it launched 18 months ago.

Despite this growth, the company has not yet turned a profit, losing £6.4m in 2016. The firm says it expects it will be profitable by 2019.

“Customer growth is due to outstrip the 209 per cent we anticipated at the start of 2017, and we’re confident we’ll continue to add more than 60 per cent a year for the next three years,” Paolo Galvani, co-founder and chairman of Moneyfarm said. “We’re just at the beginning of what we can achieve with our current product mix. The pension we launch in Q4 this year will be a real game changer, not just for us but also for consumers. Based on our current plans, we’ll be turning a profit within two years.”

On average the firm, which operates in the UK and Italy, adds says AUM  is increasing by 10 per cent each month. Moneyfarm has raised $30m (£23m) in funding since it was founded in 2011.

The company does not charge any fees for investments under £10,000. Management fees over that vary from 0.60 per cent to 0.40 per cent per annum.

Financial services giant Allianz holds a minority stake in the platform and also has a robo-advice service for its UK employees through Moneyfarm. Other partnerships include Uber, which offers discounted ISA and pension products from the wealth tech firm.

Moneyfarm is looking for ways to integrate its technology with human advice, a trend already happening in the U.S. In Italy it already helps customers with financial planning and portfolio reviews and is working with the FCA to develop an offering in the UK.