Historically, wealth managers offered consumers a choice: either put their money on autopilot (through an offering like Vanguard’s low-fee ETFs) or — if wealthy enough — be actively managed by an advisor at somewhere like Goldman Sachs or Morgan Stanley Private Wealth. As we wrote in our post Finding the Leading Wealth Management Offerings of Tomorrow, the offered choices are more a function of necessity than customer desire. Large institutions had to rely on either lower-value, more scalable offerings, or higher-value, less scalable offerings because it was the only way to make their economics work. However, this tradeoff is only necessary in a world without software.
With technology, there is a way to create a highly scalable and high-value service for consumers, and the opportunity this coupling creates is why we were so excited to meet The Coterie. Ethan, Jeson, and Chris have built an entirely new stack for wealth management where a consumer can get as much or more value as they might from a more traditional up-market offering without the need for an advisor. The Coterie acknowledges that today’s consumer wants choices, and they don’t necessarily need an advisor to present those choices to them.
The hardest problem a new advisor-free wealth management business needs to solve is how to make wealth management urgent. Money management, tax, and estate planning are always significant, but getting a consumer to want to move quickly requires a compelling initial hook. The Coterie solves for these issues of urgency and significance by offering its customers access to a limited allocation of private investment opportunities that are typically reserved for the most affluent and connected individuals. It then couples these investment opportunities with services such as tax and estate planning. This combination creates an urgent wedge and a significant product suite that can stand up next to more traditional services, and access to The Coterie’s elite inventory of private investment opportunities can provide the same display of financial progress usually reserved for large traditional financial institutions.
While who the company serves will expand over time, The Coterie is initially designed for founders, by founders. This is a team of repeat entrepreneurs determined to solve a problem they experienced. Ethan Agarwal founded and scaled Aaptiv to over 1 million paying subscribers and before that worked in active investing at a hedge fund. Despite being a successful founder, he was disappointed with his wealth management options and wanted to solve this problem for others like himself. I’m lucky enough to be working with Jeson Patel again. He and I cofounded and sold SocialDeck to Google and Snowball to CreditKarma, and I’ve been watching him build and scale engineering teams for over a decade. Finally, Christopher Boies founded and ran Boies Schiller Flexner for over 20 years and has been recognized as one of the country’s top corporate lawyers.
I’m thrilled to announce we’re leading The Coterie’s Series A and that I’m joining the board. We believe The Coterie represents the wealth management offering of the future — one that provides high-value products in a highly scalable manner while solving for urgency and significance. We’re honored to be partnering with them on this journey. The Coterie is launching publicly today and you can learn more about what they are up to at thecoterie.co.