wikifolio.com: Not Advice, but Orientation for Investors

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By Vasyl Soloshchuk, CEO and Co-Owner at INSART wikifolio.com: Not Advice, but Orientation for Investors

wikifolio.com is a Vienna-based FinTech startup that develops an online platform for investment strategies and aims to combine investing money and the principles of social media.

I had a chance to talk to Andreas Kern, CEO, and to learn many details about the company, its inception, and how the idea of a social trading platform differentiates from other offerings in the wealth-management market.

Andreas has been in the FinTech area since the very start of his career. He was CTO of a company that provided e-commerce and mobile payment applications. But when Andreas moved to WealthTech, he had no experience in wealth management:

“I had no wealth-management background before, which I think was quite helpful because wikifolio did very innovative things. It was very helpful that I didn’t have all this legacy knowledge about problems. I could apply really fresh thinking to our business model.”

The idea behind wikifolio.com

To explain how the idea of a social trading platform appeared, Andreas used the customer advisors of banks as an example:

“They are called advisors, but in fact they are just salespeople and they sell [the] products which earn them [the] most fees. As a result, the customers are moved towards very expensive products.”

Andreas was thinking about how financial products should be created and distributed. Thus, the wikifolio.com model appeared; anybody can publish their trading strategies (so-called wikifolios) and others can then observe and vote for some. Once a wikifolio receives 10 votes, the company creates a fully fledged exchange-traded product (ETP), which perfectly replicates the performance of the published wikifolio. Then, platform customers can buy any wikifolio exchance-traded products (ETPs) and get the same performance as the chosen trader.

The popularity of the platform

Currently, the platform has 1.5 million unique visitors, 160,000 registered users, and 22,000 published strategies. Andreas points out that investors do not necessarily need to be registered on the platform, although registered users do receive some benefits, such as:

• They can publish a wikifolio;
• They can form a watch list to observe particular traders;
• They receive emails (so-called risk alerts) if the risk of a chosen wikifolio goes up.

The total trade flow through the platform is approximately 20 billion euros. According to Andreas, there are several hundred million capital investments on the platform:

“If you look at the trades that happen on [the] Euwax Exchange, wikifolio ETPs are amongst the largest and the fastest-growing investment product.”