It was a revolving door in Silicon Valley as one digital advice provider reportedly laid off employees, while another announced a key executive hire.
UBS-backed SigFig laid off 10% of its workforce, according to a
SigFig CEO Mike Sha has overseen its transformation from a retail robo advisor to a fintech offering white labeled digital advice solutions. SigFig has built a suite of digital advice products, the latest being
The startup counts UBS, Wells Fargo and Citizens Bank among its technology clients.
SigFig did not return repeated requests for comment.
“These types of haircuts at a firm the size of SigFig are consistent with the ebb and flow of business development,” says Will Trout, senior analyst at Celent. “SigFig has taken on a number of ambitious initiatives and labor-intensive implementations are expensive.”
SigFig has approximately 188 employees, according to its latest Form ADV. Ten are registered as investment advisors.
Last year, the firm moved into larger headquarters situated directly across the city’s famous piers on The Embarcadero.
As some venture capitalist-funded startups grab negative headlines and fail to meet market expectations, there is a renewed emphasis among startups to demonstrate fiscal prudence, Celent’s Trout noted.
“There is certainly a call for a more restrained climate in the wake of WeWork,” Trout says. “It is a timing issue. What has changed is a degree of sanity has been introduced to the marketplace. At the end of a 10-year bull run, you have to show that directionally you are headed toward a sustainable earnings position and that’s what we’re seeing at this point in the economic cycle. The market is calling for sanity."
The robo advice market itself has seen an ebb in terms of asset flow too. When SigFig was among a crop of digital advice providers striking deals and partnerships with traditional firms, the industry was treated to forecasts of rapid digital asset growth, which have generally yet to play out.
“We're in Robo 3.0,” Trout says. “The robo market has evolved from these shiny new toys to more of a hybrid model and the devil is in the details. You have got to customize these platforms and connect with financial institutions and that has proven to be very hard work.”
Hybrid digital advice provider Personal Capital meanwhile announced Fidelity Investment’s former chief marketing officer, James Burton, will join its executive ranks.
Burton was named the firm’s new chief growth officer, a new title meant to “identify value creation opportunities for the company within its current core wealth management solutions and beyond,” according to a company press release.
Burton was at Fidelity for a decade, and before that had been at Charles Schwab in investment research. In his new capacity at Personal Capital, he will report directly to CEO Jay Shah.
"We are thrilled to add an industry leader like James to our executive team,” Shah said in the release. “His passion and knowledge will be integral to Personal Capital's path forward."
