Underlying the harsh online criticism lobbed at Wealthfront after its $75 million funding announcement was industry bewilderment over why robo advice platforms are still attracting millions in investment.

But Wealthfront may be the answer, too: first-generation robo platforms — unable to match the digital assets gathered so quickly by Vanguard and Schwab, and fending off mobile-only investment apps wildly popular with young investors — are narrowing ambitions.

“Ultimately, Wealthfront’s best path forward arguably is the one they’re taking — to try to continue to appeal to the subset of investors who don’t want a human and prefer a pure technology experience in the first place,” says Michael Kitces, a Financial Planning contributing writer, and partner and director of wealth management at Pinnacle Advisory Group in Columbia, Maryland.

Following the announcement, Wealthfront faced off a number of standard industry critiques of robo advisors: the uphill struggle with client acquisition costs and cash burn, the actual practicality of the digital-only advice model, and of course, the early claims that robos would disrupt the wealth management industry.

Wealthfront CEO Andy Rachleff says the new round of funding should be “more than enough” to see them through to becoming profitable.

When contacted for comment on the criticism it faced on Twitter from prominent RIAs, Wealthfront spokeswoman Kate Wauck referred to its press release about the funding announcement.

With over $9 billion in AUM, Wealthfront is the second-largest independent robo. Kitces notes his internal tracking data shows that Wealthfront is actually “seeing an uptick in growth rates through the second half of 2017.”

“But it’s still a very challenging journey to find a client acquisition strategy, and a business model, that can sustain and grow,” he continues. “The fresh round of capital for Wealthfront suggests that they believe they’ve finally found something that ‘works,’ and are now raising more capital to scale it. But that’s also why they raised prior rounds, only to find that they couldn’t sustain the growth rates.”

The squeeze is not just on robo advisors like Wealthfront, but also all first-generation consumer-facing firms, argues Lex Sokolin, who heads fintech strategy at Autonomous Research. These include digital lenders, online banks, and other startups that thought they could disrupt traditional finance.

“Those that have not built a sustainable business by now have a narrowing window to exit,” Sokolin says. "They face threats from four fronts.

"First, the mobile-first attention economy players — like the micro investing apps. The second is traditional finance companies like Vanguard that are benefitting from power laws in asset gathering. Third are the large tech companies — Apple, Google, Amazon, PayPal — that are nudging closer to the space. And last, the public infatuation with cryptocurrencies and blockchain based companies. Gen Z is chasing bitcoin, not robo advisor allocations at 25 basis points. It's not cool anymore.”

Maybe a marriage between two leading independent robo advisors is next, suggests Timothy Welsh, president of Nexus Strategy. “Raising money is a desperation play until they figure what to do next,” he says. “They have pivoted so many times. The runway is running out. They have been around for 10 years. If robo advisors were going to disrupt, they would have already.”

But venture capitalists are less concerned with a stated ideal as they are with a potential return on investment, notes Nalika C. Nanayakkara, principal in financial services at Ernst and Young.

"Most other independent first-generation robos are focusing on having a platform strong enough so they can get acquired by an incumbent," she says. "I believe this is one of the reasons that VCs are still finding them attractive.

"There is still white space in the wealth management industry for mass affluent investors, so innovative fintechs can find niches to be successful in, for example, going beyond robo to bring private equity or other alternative investments to the masses. VCs funding will target these firms."

Celent senior analyst Will Trout called robo fundraising efforts "the classic Amazon play, in which strategy trumps revenue... the money infusion is a bet by venture capitalists on whom can survive the longest. I don't need to outrun the profitability bear; I just need to outrun you, the competitor."

But the pure robo advisor model still has its supporters too.

Doug Fritz, CEO of F2 Strategy, believes that the future is wide open for a robo advisor like Wealthfront, especially as they put online investment technologies that may have unpredictable impact on the space.

“These are very smart people, and they have a clear vision of the arc of technology,” Fritz says. “The firms prepared to take that future will succeed.”

Fritz adds he thought the squeeze on customers in the robo space may be illusionary because the market is so new and there are “ample green fields” for all services, from incumbents to companies like Wealthfront.

There’s another way to view Wealthfront’s latest round of funding, says Chip Roame, managing partner at Tiburon Strategic Advisors.

“The amount Wealthfront has raised is impressive,” Roame says. “With this most recent $75 million, it has now raised $205 million. I think that is only rivaled by Betterment. Wealthfront is on to a trend much bigger than the naysayers who claim it is only for Silicon Valley types; nearly every trend starts with well-educated investors and then slowly moves mainstream.”

While discount brokerage firms have adopted and excelled with their own digital advice platforms, the independent robo model still poses a threat to certain advisors, Roame adds.

“The most troubled should be weak financial advisors, financial advisors who have done little financial planning and really have functioned as investment advisors while still charging fees around 1%,” Roame says. “I expect Wealthfront will survive.”

Some of the critiques against Wealthfront on Twitter were over the top, one technology investment executive says.

“You have to give credit to Wealthfront for creating the entire dialogue. Vanguard and Schwab reacted and created services because of Wealthfront’s existence. It doesn’t give them any economic value, but if they want to feel good, they can say they created an industry.”

Rachleff has long projected profitability for Wealthfront when it reached the $9 billion AUM mark, the executive adds. “I’m sure he’s closer to it than he’s ever been."

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