I like the idea behind this business and like the value that you are providing. I'm a target customer because I'm sensitive to investment fees and have done lots of comparison shopping over my investing lifetime.
Unfortunately, I won't use your product. While you do appear to be cheaper than Vanguard for a comparable product, I don't think the risk of switching is worth it. The primary risk I'd be worried about is your business model changing (or you getting acquired by legacy finance) and increasing fees down the line, at which point I'd feel like I'd want to switch back to Vanguard. I'm also worried about exposing myself to your organizational risk (e.g. your internal controls failing and an employe running off with the money, your accountant falling victim to a deepfake scam, etc.) which I suspect is going to be much higher than your competitors. For the additional .17%, I actually feel that Vanguard is a damn good bargain.
I think your product actually does have a lot of value for folks invested in crappy mutual funds or with some advisor taking a massive AUM fee, but I don't really think those consumers are generally lacking the information required to understand that your product is superior, I think they're just going for something different.
It's a tough spot. The market size is obviously tantalizing but I feel like the segments are all reasonably well served as it stands. For the folks that you're really targeting, I think it's very hard to beat Vanguard. Their corporate structure and huge size really gives them a massive advantage that seems hard to beat. Best of luck to you folks!
Same sentiment here - I feel like this is the largest challenge for people that would otherwise be ideal candidates. I wasn't even willing to move off one of the largest brokerages for the semi-recent Robinhood 3% "transfer deal" just because even there I felt like it was too much risk (granted, that was for a retirement account).
For someone that has quite a bit of my portfolio in very low cost index funds, something like $40k does seem like a relatively low "fee" for avoiding risk, especially considering it's spread over many years.
That said, I do like the idea, and hopefully there are enough folks willing to tolerate the risk to provide a viable alternative to the big status quo brokerages.
> charging $25-$40 for ACH Transfer fees (per account)
Do you mean ACAT fees? I haven't seen many accounts charging for ACH fees as those are basically free. Only Wise (Transferwise) charges for it from my experience.
If it's ACAT fees, a lot of brokerages (not Vanguard) will reimburse you the fees if the account balance you are bringing in is big enough, I've noticed.
Appreciate the thoughtful response. I hear you on switching costs being quite high for a brokerage and its very much a considered purchase. I'd love for Double to be considered in the future.
Unfortunately, I won't use your product. While you do appear to be cheaper than Vanguard for a comparable product, I don't think the risk of switching is worth it. The primary risk I'd be worried about is your business model changing (or you getting acquired by legacy finance) and increasing fees down the line, at which point I'd feel like I'd want to switch back to Vanguard. I'm also worried about exposing myself to your organizational risk (e.g. your internal controls failing and an employe running off with the money, your accountant falling victim to a deepfake scam, etc.) which I suspect is going to be much higher than your competitors. For the additional .17%, I actually feel that Vanguard is a damn good bargain.
I think your product actually does have a lot of value for folks invested in crappy mutual funds or with some advisor taking a massive AUM fee, but I don't really think those consumers are generally lacking the information required to understand that your product is superior, I think they're just going for something different.
It's a tough spot. The market size is obviously tantalizing but I feel like the segments are all reasonably well served as it stands. For the folks that you're really targeting, I think it's very hard to beat Vanguard. Their corporate structure and huge size really gives them a massive advantage that seems hard to beat. Best of luck to you folks!