Most financial advisor-client matchmaking services have had low to moderate success in the past, but David Snider, CEO and founder of Harness Wealth, plans on his firm being the exception.
Harness, which Snider founded three years ago in New York City, goes beyond the simple task of connecting prospects with an RIA, he says. Harness also connects its clients, many of whom generate wealth through equity-based compensation, with other financial planning, investment management and tax professionals.
This strategy helped the firm land $15 million in funding led by Jackson Square Ventures, with participation from Bain Capital, Marc Benioff, and Ori Allon.
Harness finds prospects through corporate partners that bring it in to help employees when the company is about to be sold or accept a large investment, as well as through its advisors and direct channels targeted at its audience of entrepreneurs. Harness then analyzes an investor’s income, assets, financial goals and risk preferences, and pairs them with an advisor using an algorithm.
There is no incremental fee for consumers who use the platform, but Harness collects a portion of the advisory fee advisors charge for their services.
“There's really no one out there that's connecting the dots of a multiple-advisor relationship or having a single source of truth for your personal financial data that makes it easier to interact with multiple advisors and get the right outcome,” Snider says.
Others have launched digital services hoping to connect advisors with prospects to
These matchmaking services help eliminate a significant gap, further elevated by the remote work setup, through pairing prospects with a “tailored advisor” that matches their unique preferences, says Mike Zambon, principal consultant at Capco.
Where Harness stands out from the competition is its unique approach to targeting entrepreneurs, which has generated significant growth for the company, Snider says. Harness saw an 848% year-over-year increase in client and advisor meetings in the third quarter of 2020, and interest from individuals going through liquidity events rose significantly in September and October compared to the two months prior.
Venture capital firms Jackson Square Ventures and Bain Capital were impressed by Snider and Katie English, Harness’s chief marketing officer, along with the company’s integrated approach for reaching its targeted demographic.
“While that value is still on paper, those people need tax advice and advice on structuring their affairs, so they can maximize the value that they've achieved,” says Greg Gretsch, co-founder and managing director of Jackson Square Ventures. “Harnesses [has] created a solution uniquely targeting those kind of people that have equity in the startup world.”
Experience was also a draw, says Matt Harris, Bain Capital partner, citing Harness's extensive skills across financial services, data and tech-enabled services as critical parts of the company's success.
Harness’s capabilities with tax planning — especially for investors experiencing stress and confusion after a significant liquidity event or financial windfall — helps it stand out from other advisor matchmaking services, Zambon adds.
The company is doubling down on this offering, Snider says. Harness is developing a new offering called Harness Tax, which offers tax preparation and planning services.
The long-term goal is to build a single gateway that people use to manage their personal finances, track and analyze existing holdings, and see historical and future tax liabilities, Snider adds.
“There's an element that sort of helping people to find the right services and the right advisors, but it's within a much broader ecosystem, as part of our goal and vision really be the gateway for financial services and the financial system of record for our clients,” he says.
