Brendan Wood: Why Embedded Investing Is The Future Of Investing

Brendan Wood, Co-Founder and CEO of SnapTrade, will be speaking at the upcoming Benzinga Fintech Deal Day & Awards at the “Improving Market Accessibility: The Future of Trading Platforms and Tools” fireside chat. Mark Nov. 13 on your calendar for the must-attend gathering in the fintech industry!

Did you know that eighty-five percent of the companies that implement embedded finance report increased engagement, saying that it helps them acquire new customers in the new value chain?

It's obvious why they would. Allowing users to consume financial products or services from companies outside the finance space creates an enhanced customer experience. No wonder analysts predict a ten-fold increase over the $22.5B in revenues from 2020.

There are many applications for embedded finance. A few kinds include:

1. Embedded Banking

2. Embedded Payments

3. Embedded Payment Cards

4. Embedded Lending

5. Embedded Insurance

6. Embedded Investing

However, we believe the next big boom is coming somewhere else. The embedded finance trend has brought other companies seeking to provide a bridge between traditional financial institutions and non-financial businesses, into the investing space.

We will be speaking at the Benzinga Fintech Deal Day and Awards about how embedded investing will be part of “Improving Market Accessibility: The Future of Trading Platforms and Tools”.

Here’s why:

Why Embedding Investment Is The Next Frontier

The world of investing can be a forbidding jungle. Managing the investing process takes time, expertise, experience, and is limited to the tools offered by a traditional brokerage – that is unless you have an embedded finance solution.

There are online platforms and apps galore for different goals and skill levels to navigate. Experienced investors can evaluate the values of stocks and buy natively on their research tool of choice. People new to the practice can automate these financial decisions without ever having to login to a brokerage.

Collaboration between investors and institutions can include offering lending services or creating embedded bank accounts for businesses. Also, can act as a connector or a bridge between financial-service providers and non-financial businesses. 

The third option is to collaborate with a company that focuses on embedding the financial infrastructure into its product or service and become a part of that ecosystem, like SnapTrade.

The embedded finance market has the potential to be worth over 7 trillion dollars by 2030— greater than the current value of all fintech startups and the top 30 banks combined. No wonder embedding investment is the next frontier.

How To Offer Embedded Finance Investing Products And Services

Accessibility opens up investment opportunities to a wider audience, including those who may have previously been deterred by the complexities of traditional investing.

Embedded investing experiences can offer solutions to a wide variety of problems for users.

Reducing the barrier to entry: providers can help reduce friction in user onboarding by syncing user's entire portfolio and history in a couple of steps, rather than manually entering everything. This makes it quicker and more simple for users to make an account and maximizing the value of the product.

Engagement: companies can enable powerful new engagement loops to prompt their users to take an action, such as place a trade or reinvest a dividend. Creative ways to provide value to their users creates brand loyalty.

Personalization: adding new features that tailor the experience to the user’s investments. If a platform knows the makeup of user’s portfolio, they can show the user things that are relevant to them - from content to research, and beyond. Having a personalized experience increases usage and brand loyalty.

Convenience: With embedded finance, users can seamlessly invest and manage their portfolios without the need to switch between multiple platforms or applications. The integration of financial services into non-financial platforms simplifies the investment process, saving time and effort for investors.

The Future Of Embedded Investing

As embedded finance continues to gain traction, the future of investing looks promising. Here are some key trends to watch out for:

1. Democratization of Investing: By making investing more accessible and inclusive through new investing experiences, individuals from all walks of life can participate in the financial markets and grow their wealth, regardless of their financial knowledge or background.

2. Partnerships between Fintech and Non-Financial Companies: We can expect to see more collaborations between fintech companies and non-financial platforms, such as Simply Wall Street, Blossom, and Stock Unlock.

3. Rise of Automation: Automated investment platforms use algorithms to make investment experiences quicker and take less time while providing individuals with personalized investment feedback and automated portfolio management.

4. Increased Focus on Financial Education: With embedded finance, individuals will have easy access to educational resources and tools to enhance their financial literacy. This focus on financial education will empower users to make informed investment decisions and improve their overall financial well-being.

How SnapTrade API Is Navigating The Future Of Embedded Finance

SnapTrade is the API used to connect users to their brokerage accounts within any fintech app, such as Passiv. It enables API access to a wide number of brokerages and crypto exchanges with purpose-built API connections. Through these integrations, users can pull real-time account data, historical transactions, and trading. Users can even place trades.

There are endless possibilities for building new investing experiences. With the features and brokerages available, the capabilities that apps can build use cases with is wide and deep.

Conclusion

Embedded finance is revolutionizing the way individuals invest by integrating financial services into non-financial platforms. This innovative approach enhances accessibility, convenience, and personalization in the investment process. As the future of investing unfolds, embedded finance is set to play a pivotal role in reshaping the global financial economy.

Disclosures: SnapTrade is not financial advice or recommendation for any investment. The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.

Brendan is a serial entrepreneur and co-founder of SnapTrade, an embedded investing API that powers more than 20 fintech apps globally. Before launching SnapTrade, Brendan led engineering at a venture-backed data aggregation startup, implemented a GPU-based classification engine at Salesforce, and built a toolchain optimizer for CNC machines. 

Hailing from the east coast of Canada, Brendan enjoys canoeing in the summer months, skiing in the winter, and family time year-round. When the weather isn't agreeable, Brendan fancies playing piano and woodworking as hobbies.