Following the news that Moneyfarm have entered the German market through acquiring Vaamo, Sergel Woldemichael, Wealth Management Analyst at GlobalData, a leading data and analytics company, offers his view on the expansion:
“The Moneyfarm-Vaamo venture proves that increasing competition in the robo-advisory market is forcing players to find new ways of expansion in order to survive. Many start-ups were hoping to get acquired or partner with a bigger brand, but GlobalData’s survey of wealth managers shows that just over 45% of larger firms in Europe were looking to partner/acquire fintechs. This has now left room for the start-ups to consolidate amongst themselves.
“With Germany being Europe’s second largest robo-advisory market by AUM; this acquisition is Moneyfarm’s attempt to think outside the box on how to really make their mark in new territory. The move is a clever way for MoneyFarm to enter a new market without the need to set up own infrastructure from scratch. With Germany being a competitive and saturated market, after setting up an own shop, it would require a lot of effort to catch up with the leaders. The start-ups recognise they are better together than separate in such a cutthroat climate.”