Theo Paraskevopoulos on transparency in financial services

The chief executive officer of Invessed spoke to FinTech Intel on a range of topics

Theo Paraskevopoulos is the chief executive officer of Invessed, a wealthtech company that aims to bring greater transparency to investing.

Our reporter, Robert Welbourn, interviewed him on several topics, including transparency, keeping the focus on the consumer at every step of the process, and how AI might become a more powerful force in investing.

So Theo, tell us about yourself!

My background is in design and technology, and I spent most of my career in the City of London. In the 2000s, I worked with companies on the investment reporting side of things. I was always interested in user experience, reporting, and tech.

My co-founder Adam and I started GrowCreate 12 years ago, and we continued to work within the industry, providing similar services but on a custom solution basis. We found that clients were asking us for the same thing over and over, so we decided to productise our solution, which became Invessed.

At Invessed, you talk a lot about financial transparency. Does that drive you to always keep the consumer front of mind?

Absolutely. Transparency is the first thing people tell us they need from their providers. The reporting side of things has definitely improved over time, and most people have a version of a client portal that gives people transparency over their investments.

Sometimes, the industry seems a little bit too in love with data. We can throw a lot of data at an advisor’s client without actually explaining what it means. Most people who work in the industry tend to understand the data, but many of them forget that the people they’re working for might not.

I’ve been reading a lot recently about the rise of AI fund managers. I’d love to get your thoughts on that.

There’s lots of value there. The industry will use every tool at its disposal to achieve scalability and help people process information. I think that’s a part of the industry that will grow for a certain segment.

At Invessed, we focus on customer experience. We know there’s a role for AI in customer experience, whether that’s anticipating risk profiles, helping people process investment reporting or even product recommendations. AI is not deployed as well as it could be on the client-facing side of things; we’re looking to introduce some innovations in that area.

Do you think there might be pushback if there are more AI investment platforms? People might be reluctant to invest large sums of money when no human is involved in making decisions on the other end.

I think that could be the case. Like any technology, AI should be a facilitator, it shouldn’t replace human interaction. There are guardrails on the technology: the AI might make a recommendation because it’s very good at crunching data, but that recommendation gets assessed by a human advisor before it reaches the end client.

Human plus AI is better than human and AI separately—as long as the relationship is transparent and the customer knows about it.

Similarly, the customer may be much more amenable to AI recommendations if there’s a justification for where the recommendation came from. You could think of it in other ways; Netflix does something similar, saying, “We think you’re going to love these because you were interested in this.”

Speaking of transparency, I’d love your thoughts on the transition from open banking to open finance.

Everyone in fintech will definitely welcome it. However, with my background, I have a certain appreciation for why it’s being delayed. Regulation, competition, fees, security, and bad actors are all reasons that delay any kind of openness in the sector.

I want to bring you back to probably quite a few years ago now, to roughly the mid-2010s when online banking became the norm. At first, it was difficult to access many banks, and indeed, in Germany, where I live, some of the traditional banks still make it pretty hard. Gradually, it’s become easier and easier. eKYC, for example, has become the norm. However, at first, it was difficult to prove, and different components were needed to link different systems together.

We’re going through a similar transition now, where disparate parts of the process that are still too expensive to put together are gradually being connected. I think in a couple of years, we’ll be talking about a much smoother transition; there will be opportunities for providers like us, who provide that flexibility, and for a whole host of innovative solutions out there in different sectors as well.

We have to look forward to expanding beyond investments and being able to rely on systems like open finance to bring together the entire financial picture. It doesn’t just have to be investments, it could be mortgages, insurance, assets or liabilities from your entire financial life. We look forward to being able to present them in one view, and you can have the same transition from one provider to another as you do now with current accounts and banks. The ease with which you move your direct debits, for example. You should be able to do the same thing with your investment provider.

Right now, I have a current account with provider A, a mortgage with bank B, investments with Bank C, and savings in bank D. Do you think there might be more financial companies offering a more holistic service in the future?

That’s the beauty of it. You can have systems that aggregate things and give you a holistic view of your entire financial life. Hopefully, that will empower people to feel like they can improve things and to have that feeling of control by seeing everything in one place.

It’s always good news whenever there’s interconnectivity, as it’s a breeding ground for innovation.

At the same time, it will also allow niche providers to give you access to more niche products. For example, if your attitude is friendly towards crypto, you can have segregated accounts just for that. The niche will segregate the crypto, whilst the aggregators will give you the convenience of a holistic view of your entire financial life. It’s always good news whenever there’s interconnectivity, as it’s a breeding ground for innovation.

Image: Invessed

Robert Welbourn Robert Welbourn is an experienced financial writer. He has worked for a number of high street banks and trading platforms. He's also a published author and freelance writer and editor.