Exclusive: Tandem Bank co-founders launch ‘Prosper’ with £3.2m, aiming to reshape wealth management
Summary
In a move to revolutionise traditional wealth management, fintech heavyweights Ricky Knox, Nick Perrett, and Phil Bungey have secured \xa33.2m in pre-seed funding to launch a new low-cost digital wealth app, Prosper AltFi can exclusively reveal.Launching today, Prosper has attracted investments from leading fintech figures, including Monzos co-founder Tom Blomfield, ComplyAdvantage executive chair Charles Delingpole, and Capital Ones co-founder and Tandem chair Matt Cooper.Knox, previously the CEO and co-founder of Tandem Bank, shared with AltFi that Prosper aims to be the "TransferWise of wealth management," aiming to drastically cut the standard fees in the industry.After observing the rise of digital banks, Knox identified an opportunity to challenge the prevailing high-fee culture in wealth management upon his in May 2021.I have no doubt that digital banks will take massive market share off the banks in the next five to 10 years, but that hasnt happened in wealth, Knox told AltFi.Theres maybe tens of thousands of customers in total across all of the [wealth] challengers but I think the change is starting to happen.Addressing this, Prosper aims to attract high net worth and mass-affluent investors by offering substantially lower fees compared to both traditional and most competing platforms.Prospers initial offering includes fee-free investments in public market index funds, absorbing even the fund fees, and options for SIPP or ISA wrappers. Additionally, they will provide competitive interest rates on cash savings and a range of private and alternative investment opportunities.We want to build a customer champion business that focuses on keeping as much money in our members pockets, whilst running a sustainable business, Nick Perrett, Tandem Banks former chief product officer and now Prosper CEO, told AltFi.We believe most people do not understand what they are paying for the management of their money.When pretty much every part of the wealth value chain, from platforms, to advisors, to indexes, to asset managers are making 30-55 per cent net profit margins ultimately from your hard-earned cash and being paid extremely well, you know something isnt quite right.Under the experienced stewardship of Phil Bungey, Nutmeg chief operating officer and Prospers third co-founder, the fintech is currently invite-only with a public launch slated for Q1 2024 and a crowdfunding campaign soon to be launched on Crowdcube.