Robo advice start-up Six Park closes $1.5m capital raise

Robo advice start-up Six Park closes $1.5m capital raise

A Melbourne-based robo-adviser has closed a $1.5 million capital raise from a powerful group of investors that includes a former finance minister and an ex-Deutsche Bank ANZ exec chairman.

This is the second round of funding for DIY investment platform Six Park, which has now raised a total of $2.9 million to help it in its quest to deliver transparent advice to Australians, while also undercutting banks and the financial planning industry with lower fees.

Ex-chairman of M&A for Deutsche Bank ANZ Michael Roche has become a new investor in Six Park and former federal finance minister Lindsay Tanner, who was already on the company’s advisory board, has now invested funds in what is a vote of confidence for the firm.

Founding head of the Future Fund Paul Costello, former Future Fund board guardian and chairman of JPMorgan Australia Brian Watson and former vice-president at JPMorgan, Patrick Garrett, along with Mr Tanner, raised $1.4 million to launch the robo-advice start-up earlier this year.

Most of the existing investors are understood to have come in for the new round.

Commenting on his investment Mr Tanner, who is now a special adviser to financial firm Lazard Australia and is president of Essendon Football Club, said the team had taken a “measured and steady path towards launch”.

“Six Park principals Brian Watson and Pat Garrett have created a modified version of the robo-adviser concept that fulfils the core objectives of simplicity, practicality, low fees and high quality risk management while also ensuring that the automated platform is overseen by experienced advisors able to interject market intelligence and insight,” he said.

“Six Park is the marriage of an innovative approach – robo-advice with a human overlay – with a careful and considered build, ensuring that the usual risks of undue haste and exaggerated faith in the product are minimised by genuine business prudence.”

Six Park was founded by Mr Garrett and Mr Watson in 2014 and charges less than 1 per cent in annual fees, a saving of 1-2 per cent a year compared to traditional financial planning services.

Mr Garrett believes that there will be a convergence between the robo-advice technology players and the traditional finance firms.

“Smart incumbent wealth management firms see the need to be able to engage with clients throughout the life cycle of investment management and that will include the low cost low touch model now with robo, and that will evolve into more complex clients with larger complex needs and that’s where the human touch comes into play,” he said.

“The wealth management industry is seeing a huge wealth transfer over the next 10-20 years and consumers both young and old are demanding sophisticated digital offerings; they don’t really really want to talk to a person unless they have to and they want to see that reflected in their costs.”

Mr Roche also said the future of robo-advice was bright.

“I am convinced that robo-advice will play a greater and greater role in the formulation of people’s superannuation and saving plans going forward, particularly as investors increasingly favour modern cost effective platforms in a subdued returns environment,” he said.

Six Park operated in beta mode before its launch in May this year.


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Source: Robo advice start-up Six Park closes $1.5m capital raise |