Wealthfront acquires robo advisor Grove
Financial Planning reports that the deal will boost Wealthfront’s Self-Driving Money strategy, which envisages digital-driven wealth management in the future.
Wealthfront reportedly manages around $11.5 billion in assets for 220,000 clients. CEO, Andy Rachleff, tells Financial Planning the firm has nearly doubled its total client assets this year.
The company claims to have attracted $1 billion in deposits to its new cash account within just a few months of its February launch. Wealthfront has also previously launched a Visa debit card and the ability to direct deposit paychecks from employers, in partnership with banking and financial services company Green Dot.
Since its launch in 2015, San Francisco start-up, Grove, has focused on providing access to certified financial planners (CFPs) and financial plans for clients who lack the requisite assets for a traditional financial advisor.
Grove co-founder Chris Hutchins says: “We’ve always appreciated the role technology and automation can play in scaling quality financial advice.”
The fintech’s clients will be offered the option to transition to Wealthfront or, if they prefer a human approach, to transfer assets to hybrid robo advisor Facet Wealth.
“Grove clients signed up for a hybrid financial planning service and we want to respect that preference,” says Wealthfront spokeswoman, Kate Wauck. “Our focus at Wealthfront is delivering financial advice solely through technology and ultimately via Self-Driving Money vs CFPs.”
Some CFPs will be moving from the Grove team to Facet Wealth, based in Baltimore.