Sramana Mitra: When you decided that this was the mission around which you were going to create an offering, what did you decide to do? What was the product or service? What format did it take?
Hugh Massie: I realized that it needed to be a product that was scalable. It could be done by any person in the world regardless of their age, race, culture, or belief systems. That meant two things. It needed to be a very good technology system. Two, from a human behavior point of view, it needed to be validated. I needed to develop from the outputs that we needed to know about a person to deliver a client-centered, behaviorally-driven service.
What are the behavioral outputs we need to know? How do you validate those through asking certain types of questions? There are various psychometric models out there but we had to choose the right one. We needed to be able to validate certain sets of behavior, particularly finance behavior. That’s where we have a strong differentiated niche. That was the starting point. You have to have the science right. The next part was to have the technology right and be able to reduce it down to simple terms that anybody can touch.
Sramana Mitra: That’s philosophy. What was the product format? What were you selling?
Hugh Massie: We were selling online behavioral assessment – a discovery process that both financial advisors and the client would complete. They’d go to our website, for example. There is a place there where they can register and complete an online assessment that now takes 10 to 12 minutes to complete. They’re going to learn these behavioral insights about themselves and then would be taken on a journey to apply that to their financial planning.
The product we sell is online behavioral assessment. We sell them usually to financial advisors who buy it from us in a subscription package. They pay us an annual fee and they can use it as many times as they like with each of their clients. They’d also use it with their team. That’s how we make money out of this today. Plus, we also have consulting services and training programs. That’s the core.
Sramana Mitra: It’s personal finance. The heuristics of this is around personal finance.
Hugh Massie: It’s around personal finance. It’s around how individuals make financial decisions.
Sramana Mitra: In the way you deliver the service, is it in the form of content? Is it in the form of actual personal finance advisers? How is the value being provided?
Hugh Massie: We don’t provide the actual financial advice itself. That is what the financial advisor does. We provide the financial advisor with the information on how somebody is going to behave in up and down markets and through different life events on an ongoing basis. We provide predictions on how somebody will behave, if they will have a preference to being emotionally comfortable with investments.
The final product selections that they adopt in their plans and the final goals they set come from the conversations and interactions between the advisor and the client. We don’t always know how much money someone has. The outcomes are not related to someone’s dollar wealth. They’re related to who they are as a person.