A fintech specializing in leads for wealth managers, Cashmere AI, is getting a $3.6 million boost through a seed funding round, the company announced today.
Cashmere, which launched last year, counts about a dozen RIAs and teams at banks and wirehouses among its clients. The lead investor in the funding round, Canapi Ventures, is a venture capital firm focused on early to growth-stage fintechs. Other investors include Benchstrength, Plug and Play, The House Fund, and Courtyard Ventures.
“The wealth landscape has really changed. What wealth looks like in America has really changed,” said cofounder and CEO Farbod Nowzad. In working on ideas for the startup the other cofounder, Eshan Govil, Nowzad said they kept hearing “the same narrative” from wealth management firms – that the business has relied too much on word of mouth and referrals for client prospecting.
The industry has lagged most others that pursue wealthy clients in terms of using machine learning to extend their reach, he said.
“This was really a data problem that had to be solved,” he said. “This was the right timing, especially with AI being so usable.”
The firm identifies prospective clients for firms by collecting data, scraping it from publicly available information online, including government records, he said.
“What we’re looking for are moments in time or signals that tell us somebody is in a place in their life where they might need financial advisory services,” he said. That might include an inheritance, divorce, or selling a business.
“From there we build detailed profiles on who they are,” including estimated net worth, contact information and other data, he said.
The company matches advisors that are “best fit” with potential clients, using machine learning to do so, he said.
“It’s a very human-to-human decision on who advisors are going to go with,” he said.
That can be increasingly important amid a surge in generational wealth transfer, the company noted in its announcement.
Results of a survey of nearly 500 advisors published today by InspereX show that less than 20 precent of clients are under 50 years old, with 59 percent being 60 or older. Most, 60 percent, said that younger workers are “being influenced to go elsewhere for advice,” although 87 percent indicated that it is not a waste of time to try to win younger clients.
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