BloombergBlack shutting down
Online wealth management tools to DIY mass-affluent investment crowd doesn't get off the ground.
Less than three months after Bloomberg LP began testing its online wealth management business, BloombergBlack, it said last week that it is pulling the plug on the venture.
BloombergBlack was slated to provide wealth management tools to the do-it-yourself mass-affluent investment crowd with accounts held at various online brokerage firms. At a price tag of $100 per month, users were to have access to account aggregation, personalized investment advice and a stream of financial news from Bloomberg’s editorial side.
“I’m a bit surprised that they pulled the plug as quickly as they did, given that they surely have enough capital to incubate it and give it a chance to grow,” said Michael Kitces, a partner and director of research at Pinnacle Advisory Group Inc.
Overestimating the market
One theory of his is that Bloomberg started to realize the necessary market might not be there quite yet.
“You need people who are sophisticated enough to utilize the kind of metrics they are creating, and affluent enough to have enough dollars that it matters,” Mr. Kitces said.
“There is definitely room for these disruptive companies,” said Sophie Schmitt, senior analyst for Aite Group LLC’s wealth management team.
Attempts to contact Bloomberg LP representatives for comment weren’t returned by press time.
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