CEO of abrdn Stephen Bird
Abrdn has completed a deal to acquire AI-driven wealth management solution business Exo Investing for an undisclosed fee, with the firm hoping to build an “industry-leading” technology offering.
The deal, which is expected to complete in the fourth quarter of 2021, will see abrdn launch "24/7 digital wealth management" via an app.
Exo Investing offers artificial intelligence-powered investment technology, enabling customers to create a portfolio built around their individual goals, risk profile and preferences.
Investors will choose between a customised, themed or fully automated approach.
'Customised' investors can select their preferences in areas such as sector, geography and investment style, while ‘themed' investors can choose pre-defined strategies, such as ESG and emerging markets.
Automated investors can decide to let Exo Investing create a tailored portfolio designed around their goals and risk appetite.
Abrdn said the deal will complement its existing personal vector capabilities, such as open banking insights, simple risk-rated savings and financial advice.
"Our ambition is to be the company individuals turn to when developing their savings and investment goals," the firm added.
CEO of abrdn Stephen Bird said: "This is an exciting and significant step forward in building out our personal vector capabilities.
"Exo was the first of its kind to offer a fully automated wealth management platform, leveraging machine learning to feed into portfolio decision-making.
"There is a downward pressure on fees, changing customer expectations and increasing regulatory requirements. It is important to address these issues by providing a highly-scalable, next-generation service to investors."
It comes as abrdn published its financial results for the first half of 2021, which saw fee-based revenues climb 7% higher and adjusted operating profit jump 52% higher on the same time last year. These figures represent the highest rates of growth since the Aberdeen and Standard Life Investments merger.
However, net outflows were £5.6bn for the first half, with positive market movements keeping AUM broadly flat at £532bn.
Bird said abrdn has "made a strong start to the year and our three-year growth plan", with "each of our three growth vectors [delivering] higher revenue and profits, contributing to the highest overall rates of growth since the merger".
"Our strategy is about focusing on client needs. The improved flows into our strategically important products and services show that we are answering client demand," he added. "The majority of the outflows that we are seeing are lower margin.
"We have made good progress in simplifying and focusing our business. The leadership team is now in place to drive the growth we seek through our strategic priorities. Our capital strength gives us the ability to invest in these priorities.
"We have a clarity of focus under our new brand and are better positioned to have impact at scale as a global business. We are at the beginning of the journey and we are moving at pace to build our new future."
