Sunday, December 22, 2024
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New social investment platform Follow taps influencers to mirror their investment strategies

If you’d like to invest the same way that fintech influencers, including Austin Hankwitz, WOLF Financial, Breyanna Nava and Patrick Meng do, Follow can help you do that.

The new social investment platform enables users to subscribe to a creator’s financial feed and set up an investment portfolio that mimics that particular person’s investment strategy. And, as Follow’s creator network grows, users can subscribe to additional creators to better diversify their portfolios.

Social investing is not a new concept. Coinbase, Robinhood, eToro, Shares and Public.com are all doing it, going after some 50 million people eager to try retail investing, according to Follow CEO Manning Field.

“The size of the market is huge,” he told TechCrunch. “Our biggest competitor is inertia. There are 57% of people not putting money in the market. We aren’t stealing market share from any of them, but instead meeting new people and bringing them into the game.”

The genesis of Follow is part Atomic incubator and Field, who saw how his children were engaging with social media. Field’s background is in finance, most recently as COO of Acorns and the CEO of Acorns’ regulated entities. He was also with J.P. Morgan Chase, where he led product development for Chase’s retail and card businesses, creating cards like Chase Sapphire.

“I was watching the way my kids interact with the world, particularly social media and influencers,” Field said. “It became very intriguing to me to see if you can build a business around influencers in financial services, particularly in investing.”

He found that there were some technology and regulatory hurdles to social investing, which is why he believes not many have been successful. However, he “felt like it was a problem worth solving” if it helped connect a new segment of younger people to investing.

Field left Acorns in 2021 to start Follow with co-founders Benjamin Rapaport, Miles Cole and Danny Evens, who co-founded the company at Atomic, where he also serves as the head of capital markets.

Today, they are officially launching the company with a group of 25 influencers, who the company calls “Leaders,” after raising $9 million in new funding with backing from Atomic, Uncork Capital and Vera Equity. The Leaders typically have wide follower bases on TikTok, Instagram and YouTube.

Follow users pay a monthly subscription set by the Leaders, which currently ranges from $1.99 to $19.99, and then benefit from exclusive content and the execution of their favorite influencer’s investment portfolio trades within their own Follow Registered Investment Advisor investment accounts using its feature called SuperFollow.

From then on, the portfolio syncs in seconds whenever there is new movement from the influencer. The company will make money from those subscriptions, but Field said the majority of the revenue will go to the creator.

The company’s proprietary review process evaluates the Leaders’ investment strategies via their brokerage data and monitors their history of responsible social media behavior to make sure their social messages align with their investment activity. In addition to the 25 Leaders, Field says there are another 40 in the pipeline.

One of the ways Field does say Follow differentiates itself from other social investing platforms is that it is an investment advisor and can claim to be the “first social investment platform to automate copying of trades for U.S. equities to U.S. clients.” He qualifies this because other companies, like eToro, automates trades, but for crypto and outside the U.S.

Field will deploy the new capital in product development and additional hiring. With the launch of the platform today, he expects to see where they have gotten it right and where they have gotten it wrong as they parse through the data.

He said now is the right time for Follow, where two years ago, the influencer segment wasn’t big enough. However, through the global pandemic and bolstered by government stimulus, fintech influencers have built big audiences.

“We were watching young people get hurt and make mistakes, so it was urgent to me to get Follow out there,” he added. “When the markets are down, it is a great time to get started. Stocks are on sale right now, so you can just start chipping away.”


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