A snapshot of the last Circuit event of 2018
By Prue Roberts
The FSC’s last Under 35s Circuit event for 2018 brought together three female panel speakers to discuss entrepreneurship, technology, and the changing attitudes towards investment in Australia.
Kylie Charlton, Chief Investment Officer, Australian Impact Investments; Jade Ong, Co-Founder, AtlasTrend and Katie Cox, Operations Lead, Zuper unpacked a range of topics – with the assistance of moderator James Deb, Associate, Strategic Accounts at NAB Asset Management.
Conversation opened with an overview of each speaker’s business background, where a solid thread of comments emerged on the connected theme of investment – and how technology and the consumer are playing a large role in driving change in the industry, as well how influential the notion of ‘impact’ is becoming.
Jade from AtlasTrend introduced her company, which is an investment platform that provides access to global investing with a purpose by enabling anyone to easily invest in, or educate themselves, on a variety of trends impacting our world. She added that AtlasTrend’s savvy online platform puts transparency and education in the spotlight, giving members a holistic view of the performance of funds being managed.
Zuper’s operations lead, Katie, then provided some background on her involvement with Australia’s ‘new breed of superannuation company’ and how the business is attracting a wide range of customers based on its investment strategy.
And Kylie from Australian Impact Investments, who has worked in Australia and internationally at the intersection of mainstream capital markets, impact investment and philanthropy for more than a decade, provided some insight into what the traditional impact investment sphere is – from the perspective of its global interpretation of being a fund, organisation or company who are intentionally generating social or environmental return alongside financial return.
The conversation then touched-on a range of topics, including;
Investment and transparency
Prevalent in the discussion was how different levels of transparency are influencing investment decisions not only in Australia, but also internationally.
Kylie said, “Transparency is really important to investors, and the conversation has gotten louder and louder over the years because people are demanding to know what’s happening in their managed fund.”
Jade added, “Transparency and education is key on our online portal, where there is regularly updated information available about trend decisions and portfolio performance. The transparency to see all investment activity made by AtlasTrend is attractive to our customers.”
Investment and engagement
Alongside the discussion on transparency in investment was the importance of engagement.
Katie believed that education is key, “We need to educate people to ask the right questions, so they know what to ask before figuring out what’s best for them when it comes to investing.”
“Financial literacy is low in Australia. People are unsure about what to ask. And information needs to be digestible and human, plus meaningful.”
Additional to this, Katie said, “Consumer choice nowadays means people are also holding financial services organisations to a much higher standard than they have before.”
“Millennials are increasingly aware of their consumer power and want to use their consumer power. Zuper saw the opportunity for millennials to get inspired by, and get behind, directing their money towards things they really care about.”
Zuper’s members get to choose investments that matter most to them – with the ability to design their own portfolio based around the investment framework provided. They also have the ability to vote on the organisation’s next investment option.
“We’re about reaching people on the ground. Our approach is also about making people feel unique. So, we’re speaking to their passions rather than speaking to their financial brain. We’re connecting to people in an emotional way, rather than in a logical way.”
Investment and ‘doing-good’
The panellists discussed how the effect of social and environmental impacts in the investing space is seeing a large upturn.
Jade commented that, “AtlasTrend launched a trend a few months ago on clean disruption, which invests in global companies that are contributing to a cleaner, greener world. What we found, even though the fund was new and had no track record yet, was that customers were still making investments in that fund. We’ve seen a lot of investment interest in it."
“We think it’s driven by consumers having a growing awareness of wanting to do good. People are more socially-conscious.”
AtlasTrend’s impact philosophy also sees a shareholding structure of 21% ownership of charitable foundations.
Investment and technology
There’s little doubt that Fintech is having a huge impact on the financial services industry, including impacting the investment world, and all three panellists agreed that this will be an ever-present feature moving forward.
Kylie’s involvement with micro-finance and micro-insurance tech businesses lead her to talk about some great experiences in this area, “We’ve seen significant investments and very strong exits within micro-finance. A number of the companies we’ve worked with have gone to IPO stage (Initial Public Offering) over the last five years – and we’ve got to keep telling these stories in terms of allowing people to understand where opportunity really is.”
Jade commented that AtlasTrend’s tech-enabled aspect made the product a reality. Other pluses for the online platform include a “really easy and hurdle-less onboarding process. We’ve done away with paper and made the process much easier.”
Katie added that there will definitely be more to come in the Fintech realm, “With Open Banking, we’ll see a lot more change and disruption – and customer power will change.”
Investment and accessibility
Kylie outlined that the biggest challenge in the impact investment space was its access, as well as awareness. “To date, product created for people to invest in has been restricted to wholesale investors. Not retail or 'mum and dad' investors on the street. This is a significant barrier for engagement."
“One of the biggest questions now is how do you democratise it and bring it down to a retail product? To be able to successfully do that depends on the ability to demonstrate a track record of financial performance, and also the impact performance of these investments. People, no matter how passionate they are about a cause or purpose, ultimately do need to invest for financial return as well.”
“The utopia for the investment world for practitioners is that no longer are we just making investment decisions on a risk reward analysis, but we’re actually making them on a risk reward and impact analysis, because absolutely every investment decision we make has impact.”