Quick Vocabulary Guide

• Asset management company, a company that offers investment fund products.
• Investment Fund, is an investment scheme in which investors pool their money together in a fund in order for a professional fund manager to oversee and manage their money. In return, the asset manager management company takes a fee for the service. An investor may choose a fund based on its goals, risk, fees, etc.
• AUM (Assets under management), an the total market value of the fund. In other words, the cash + value of an asset that the fund is managing. The larger the AUM, the larger the fund. The metric is also used with other financial entities, but here in terms of investment funds
• Broker, a company that arranges transactions between the buyer and the seller.
• Performance, how well the fund has invested.
• Retail Investor, a private investor.
• Qualified / Acredited Investor, a high-net-worth investor.
• Professional Investor, an investor that has the experience, knowledge, and expertise to make their own investment decisions and properly assess the risks.
• Institutional Investor, a company or organization that invests on behalf of other people. For that reason, they are often the larger investors in the market.

introduction

I joined Coherra when its first product (FundFace) was in the early conceptual stage. The development team consisted of 2 frontend developers, CTO, and me as the sole product designer. My role was to spearhead the product development. This was in terms of translating user research to actual designs and setting the product strategy in collaboration with stakeholders.

The Problem

The asset management industry can be described as a conservative industry in terms of digital solutions. We identified the following problems on the fund managers side:

• Client acquisition is very costly and time-consuming. Often banks would take very high fees ( up to 3% ) to distribute funds to the banks' customer base. Furthermore, traveling to meet clients is very time-consuming. In other words, it takes a lot of effort and cost to get new clients. This was particularly an issue for smaller fund managers who didn't have a brand or reputation with them.
• The content from the investment fund is rarely engaging. Funds would often provide very long pdf reports on e.g market outlook that even qualified or institutional investors would skip. As a result, it makes communication very difficult, and meeting with investors would often start from scratch

On the investor side, we identified the following problems

• It is difficult to understand what the investment fund is about and how it differs from other funds besides how it is performing. Since funds would be present themselves through long documents.
• Exploring investment funds is very fragmented. Often investors would have to go to their bank or broker and then choose from the funds they had available. Instead of choosing a fund that suits you and then afterwards go to the broker or bank that sells the fund. This means that investors would have to visit multiple banks/brokers to find the fund that suits them or settle for the investment product that is available at the bank/broker.
• Difficult to know who they can trust for financial advice. Investors often need to filter through the noise.

The solution

As a solution, we came up with FundFace, a two-sided video-first platform. It enables fund managers to display their investment funds through videos. Investment funds get their own "fund profile", which gives them the following benefits:

• The videos enable fund managers to put a face on the fund by having the fund manager speak about their investment strategy, market outlook, or simply presenting their fund. Thereby making them more personal and relatable. Furthermore, it also strengthens the fund managers' brand. This is in contrast to the old ways when fund managers would provide 10-25 page reports that no one would ever read.
• The fund profile is a lead generator. It enables funds to list links to the brokers platforms where the fund can be traded or list company contact that potentual investors can contact. The fund shares are not bought/sold on the FundFace platform since the platform is non-transactional, but instead bought/sold out side the platform.
• FundFace is the most compliant way for funds to store their videos. Funds can decide which types of investors are allowed to the fund profile. E.g. that hedge funds are not regulated, and therefore not accessible to a retail investor. For that reason, hedge funds prefer that their content is only shown to qualified and institutional investors.
• Only fund managers and financial experts are allowed to produce videos on the platform. Thereby ensuring high-quality content for the investors.
• Investors can follow the fund and get updated. This makes it easier for a fund to reach its investors.

Fund Profile

Fund Profile - "Where to invest" page

Investors can discover investment research videos produced by the investment funds. Whenever a fund uploads a video to the "fund profile", it will be automatically pushed to the discovery page where investors can discover the videos.

• The videos are categorized to make it easier for investors to explore topics that interest them.
• Furthermore, the video in each category are shown accordingly to the user's preference.

Discovery Page.
All the videos from the fund gets aggregated here.

Video Player page
Every video has a link to the investment fund which uploaded the video. Every time a fund uploads a video, it drives traffic to its fund page. In short, the videos becomes a tool to distribute their fund.

The process

Intro

Our CEO had the vision to build a platform that connected fund managers with investors. This was based on his own experience when he was running his hedge fund. One of the issues he ran into was in terms of the distribution of the investment fund. Banks would often charge hefty fees for distributing his fund.

He imagined a Netflix-like platform for investment funds where investors would be recommended funds depending on the investors on the investor preferences. For the product development, we had his network, experience, and his industry know-how to draw from. Furthermore, fund managers are also professional investors themselves since fund managers handle investment on behalf of their clients.

The next step was to understand both the investors and fund managers so that we afterward could take the concept to actual designs.

User Interviews - Fund Managers

We started by interviewing the fund managers since they were the paying customers in our business model, so it was important to understand them well.
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Our interview guide had a particular emphasis on collecting stories. Stories give you the context of the problem they are facing. Furthermore, we didn't want to mention our concept, and instead focusing exploring their daily life and the pain points they were facing to get the best quality of data.

We made the following main findings:

• Validated our assumptions that distribution was expensive and banks would often act as middlemen. However, they were shifting away from that, and fund managers were looking for less expensive options. They could see the value of sliming down the supply chain.
• Reputation tends to stick with previous companies, making distribution more difficult if they moved on. One of the interviewees was working as the Head of Global Assets at UBS with a mandate of $100 billion in AUM, when of the world’s most prominent investment banks. At UBS, the client was coming to him and all he had to do was pick up the phone and ask if they wanted “investment product A, B, or C”. He also told a story that the CEO of Pension Denmark was happy to write checks in the size of 300.000 KR for the interviewee's service. However, when our interviewee moved on from UBS and started his own company, the CEO of Pension Denmark would not even pick up the phone despite their working history.
• Fund managers could see that they were talking over the head of their clients. The clients couldn't fully grasp what the fund managers were selling. One of our interviewees mentioned that he could have benefitted from having an explainer video similar to the one Ray Dalio (a famous fund manager) made explaining macroeconomics. It became very clear that videos would be a way forward.

Survey - Investors

With an initial understanding of the fund managers' problems and their way of working. The next step was to get an understanding of investors. We wanted to get a broad overview of the investors' pain points and everyday life related to investing. For that, a survey was an appropriate tool.

With the survey, we wanted to keep it short, so that people were willing to complete it. Along with a few questions about how they work, we also asked very few demographic questions like "how long they have been investing" and whether they were retail, qualified, institutional investor. Finally, at the end of the survey, we asked if they were willing to be contacted by us.

We shared the survey on social media investing groups, with friends, and family, receiving 55 responses (36 international + 19 danish investors).

• The responses suggested that the “pre-work“ of investing takes up the majority of the time. Little time was spent on the actual buying or selling. Respondees said they spent the most time on: (83%) investment research, (60%) finding investment opportunities, (43%) discussing investment opportunities.
• Investors wanted to understand what they are investing in, so that they can make a profit. Trust (80% agree) and transparency (86% agree) seem to be deciding factors when investing. One reason could be that it is easier for investors to determine whether an investment opportunity is good or bad.
• Furthermore, the story of the investment product seems to be a major factor in investment decisions (56% important, 26% neutral, 16% not important). This suggests that communication plays a major role in the investment decision.
• Finally, we asked the respondees what they found most difficult. They responded as followed: (50%) finding a fund that matches their needs,  (35.7%) Understanding the funds' strategy, (29%) understanding the financial terms used to describe the fund.
  

From the user research so far, it was clear that were communication issues. Fund managers were simply speaking over investors' heads. With trust and transparency being a deciding factor for investing, it would be an issue that a large chunk of investors didn't understand the fund's strategy or the financial terms used to describe the fund. In other words, investment funds were unwillingly opaque, when trust and transparency were deciding factors. Investors need to know what they are investing in.

Early Designs - while waiting for survey results

While we were waiting for the survey results to roll in, we did some early designs.

The aim was to help us conceptualize internally where we were going. In other words, we tried to sketch and later wireframe out different solutions so that we could discuss them internally within the team. The sketch and wireframe design artifacts brought everybody on the same page and served as a tool for discussion.

What we landed on a Netflix-like platform for discovering funds. Here, the investors can browse funds according to their interests and would get recommended funds based on the investors' user activity. We also made a few high-fidelity mock-ups that the sales people could share in slides with potential customers to get feedback.

Field research - Going to investor events

The next thing we did was conducting on field research by taking an ethnographic approach. The purpose was to get a better understanding of the investing community. Field research gave us to observe and talk to other participants.

We did four field studies. The first two of them were investing for beginner events by Ophelia invest, the third was an event at Saxo bank for more experienced investors, and the last event was an investment for fund managers and investors held by Skagen Fondene.

The field studies were conducted at different times throughout the process. But are collected in this section for ease of reading.

Ophelia Invest event - "CrowdLending Platforms" and "Investment Funds for beginneres" with Sarah Ophelia Møss as moderator

Saxo Bank event - "Gateway to China" with Steen Jakobsen moderating a panel of financial experts talking about their outlook on China

Skagen Fondene event - reception

Skagen Fondene event - Investment talk by Nouriel Roubini, also known as "Dr. Doom" for predicting financial crisis and being a perma-bear in the media

From the field research we learned the following things:

• Knowledge sharing/consumption is a big thing if you want to stay ahead of the curve. Just seeing a lot of people showing up and filling every seat, indicated participants seemed very eager to learn more about investment. Whether it was new or seasoned retail investors learning the basics or fund managers learning from other fund managers. It is important to get different perspectives from different actors in the field to better anticipate the market.
• When the speaker was presenting, two-way engagement was expected. This helped facilitate a deeper sense of knowledge-sharing since the audience could get the speaker to elaborate or ask other related questions. Furthermore, the speaker would ask a question and ask the audience to raise their hand if they agreed or not, to engage them.
• Fund managers seem to take a lot of pride in their performance, and it seems like that identity is wrapped around it. When I was standing in line to grab breakfast that was offered by the event organizers (Skagen Fondene). Two in front of me joked that "Skagen Fondene must have performed baldy" since the food got worse than last year and therefore had to cut down food costs.

Interviews - Investors

The next thing we did was to understand investors on a deeper level than we had with our surveys. We used the answers from the survey as the base for our interview guide. In particular, we were interested in digging more into how they did their investment research and discovering new investment opportunities.

The focus was on understanding the investors' problems, rather than presenting them with a solution. In other words, we wanted to know about their pain points, aspiration, and stories about their investing life. This was to get a better picture of who they were,  what motivates them, and them to do what they do.

We conducted interviews with 6 investors and learned the following things:

• The interviewees mentioned that they preferred and gained more from listening to experts talking or discussing with peers rather than reading a book. Some of them felt that it was difficult to be engaged with a book and would eventually lose interest.
• One of the interviewees pointed out that so much noise online, especially on social media where people would share low-quality investment research or ideas. For E.g. the research wouldn't be based on data, but more on personal or emotional opinions. This meant it would take a lot of time to filter the good content from the bad. Another interviewee mentioned that you have to stay critical when reading comments from other people online.
• Several interviewees pointed out that investing is a big decision as you are pointing your hard-earned money on the line. Doing investment research was important for them to make sure that they knew what they were invested in. One of them said made her feel more confident about her investments, which was why she also spent most of the time researching.
• In terms of finding new investment opportunities, word of mouth was still the most prevalent way of discovering new investment opportunities. This would often happen on social media or through friends & family. However, as mentioned earlier they were extra skeptical when it was on social media.

The findings suggested that were some pain points with consuming investment content. This was problematic because investment research would often be the driver for doing the investment. This also explained the reason that 83% of the survey spent most of their time doing investment research.

Iterating on the concept - pivoting to a video-first platform

Based on that our learning from the interview and surveys, we shifted our concept from discovering funds to discovering investment videos. Simply because investment research videos would be a better way for the funds to get the investors' attention.

Previous design centered around discovering funds

The new design was centered more towards
discovering investment videos

Design System

It was clear that designing the platform would be very UI intensive. For that reason, we decided to start up a design system.

A design system would help us make the designs more easily maintainable, make our designs consistent & efficient, and speed up the UI development. Furthermore, a design system would allow us to structure our designs in a similar fashion to how a React developers would structure their compoenent in the codebase. Thereby making the implementation from design into code easier.

First and foremost, we used the 12 grid column and the 8-point system as the basis for the visual design. We also defined the typography and color scheme.

For the color scheme, we chose white as the base color. The reason being we wanted a neutral color that didn't take attention away from the investment funds' brands.

12 grid columns to help organize content

8-point system. The distance and size of design elements is dividable with eight. Thereby making it easier to choose the distance and size.

Typography

Colors scheme

We also created a library of reusable components. This was an ongoing process from which we created new or remove old components. Those decisions were based on what was needed in the new screens/features and what already existed in the design system. Furthermore, we also went through the design system to evaluate the purpose of each component to see if any of them were redundant. The component library gave us the following benefits:

• Speed the UI development and make the UI more easily maintainable. E.g. Making changes to a component would propagate to all instances.
• Gave us a visual overview of the component used. Easier to evaluate whether there are redundant components in the UI designs since every type of e.g. buttons are collected on the same Artboard

The image shows the current state of the component library, but at the time component library was much smaller. It has been expanded over time as new features have been developed.

A zoomed-in image of how the library was structured. Here we defined the buttons. Variants were added later when the feature was introduced in Figma

Creating a prototype of the platform

The next step was to create a prototype that internal and external stakeholders could interact with. This would give people a better sense of the platform since people can click around. Rather than trying to interpret a static image. In other words, the intention was to use the prototype as a tool for communication, but more importantly, it was for tool testing.

Feedback from investors

We shared the prototype with the same investors we interviewed earlier to get feedback. The purpose was to examine whether we were in the right direction in terms of the value proposition. During the feedback sessions, we reminded participants that they shouldn't hold back on their feedback and that everything could be easily be changed.

Then we made the following main findings:

• They mentioned that it was important to have a steady stream of quality content if he would continue using it. In other words, the content was king. A platform without good content wouldn't be able to sustain his interests.
• One mentioned liked the investment video categories on the discovery page. He elaborated that he tries to follow the market news of the asset classes he is invested in. It was a way for him to evaluate if his investments were heading in the right direction.
  
• Another one suggested that you could follow fund managers that have well-thought opinions to cut through the noise. It was the same person who earlier in the user interviews said that there was a lot of noise online. For him, it was important to filter the bad content from the good content.

Feedback from Fund managers

We also shared the prototype with fund managers to get feedback. The purpose was to learn how saw themselves on the platform and how it fitted into their daily work.

• One of the fund managers said it was innovative and there wasn't any equivalent on the market. He mentioned that there were other platforms for finding investment funds such as SeekingAlpha and Reveal Insight, but those platforms were more focused on displaying data/facts about the funds. He couldn't think of any other fund platforms that were video-based.
• Liked the visual design and could see that their brand would fit into the platform. Thereby validating our assumption that choosing a neutral background would be most suitable.
• Liked the bridge between the fund profile and the broker platforms. However, he elaborated that there needs to be a country to filter for the list of brokers as funds could be potentially be traded at +50 brokers. Another fund manager mentioned that broker accessibility depends on the country. For E.g. a fund might be on the Swedish Nordnet, but not on the Danish Nordnet.
• All the fund managers were very much interested in the analytics part of the fund admin and that it could offer investment tailored data, which platforms like Vimeo or youtube wouldn't be able to produce. E.g. "how many of the people who see my video clicks on the invest button".
• One of the smaller fund managers voice concerned that bigger investment funds could take the spotlight from the smaller ones. Platform fairness is big a deal. The bigger funds have more bandwidth to produce more videos than smaller funds, and would therefore be more visible on the platform. This meant we had to think about the "visibility fairness" on our platform and that you didn't become invisible because you were small.

Product / Platform Strategy - focus on scale-independent features

However, there was still a problem. We kept hearing that from potential customers that "the platform would make much sense if there is traffic coming into". Similarly, the feedback from investor users showed that the platform only was valuable to them if there was enough content. This was very much a chicken or the egg problem. Fund managers only want to join if there are investors and investors only want to join if there are enough funds on the platform.

We took inspiration from the Harvard online course "scaling for underdogs" and the Platform Revolution book  to shape our strategy. In the Harvard business case study, they examined how smaller companies were able to beat much larger and more established. What they found was that the smaller innovative companies were focusing on scale-independent features. Simply, because that scale-dependent features would derive their value from having a large user base, which is what larger companies usually have.

For example, OpenDining started as a booking system for restaurants. The value of their product was independent of have many users they had. Once they reached a critical mass of restaurants, OpenDining became a platform for discovering new restaurants.

Our idea was to reach a critical mass of funds (each having a fund page) before turning the product into a platform. Firstly, it would generate revenue while we were gathering a critical mass of funds. Thereby extending our capital runway. Secondly, it would decrease the technical scope of implementation. Thereby bringing us faster to us to market.

Iterating on the fund page

Based on the new strategy with a focus on scale-independent features, we decided to spend more time on designing the fund page. The reason being is that the fund page could offer value on its own regardless of how many investors were using our product. The fund page is ( in platform revolution terminology ) the value unit. The value unit is the information being offered by the producer (the fund manager) to engage with the user (the investor). In other words, it is what the investors are coming for.

While it might not be as a appealing a full fledge platform that generates leads, we believed that the fund page could still be attractive for fund managers for the following reasons:

• Having a website and a youtube channel is very fragmented, compared to having a fund page at us. On contrary, with a fund page all their videos, documents, contacts details, list of brokers, etc. would be displayed in the same space. Furthermore, Youtube recommends content that fund managers don't want to be associated with. E.g. cat videos, non-professional YouTubers giving financial advice, etc.
• Especially, smaller funds didn't even have their website up and running. And with average WordPress freelancers charging $70/hr and taking 50-100 hours to build a professional-looking website, it would cost them $3500-7000 to set up a website. Meanwhile, we would take $1000/y, but deliver a plug & play solution. In other words, smaller funds were the "low hanging fruits".
• Video-based fund profiles can automate some of their sales processes. Instead of explaining the same story about themselves over and over again, they could simply share a video for potential clients to watch. Thereby moving the conversation when they had to meet or talk with potential clients.
• The analytics on the visitors and viewers provide investment tailored data that are not available on another video platform. E.g. how many viewers indicate investment interests.

While the investors can no longer discover new funds from the get-go, many of the value propositions remains the same: 

• A video-based fund profile makes it easier to understand the fund's strategy, market outlook, and newsletters. On top of that, it is presented by financial experts.
• Everything about the fund is collected in the same place, making it easier to find everything related to the fund. In that sense, the fund page function as a hub.

Everything about the fund is collected in the same place, making it easier to find everything related to the fund. In that sense, the fund page function as a hub.

A twitter*like feed where a fund could update with the latest news.

A feature filtering the audience based on investor type. Thereby allowing fund managers to choose who can see their content

Request from sales

We had the salespeople share the concepts with potential customers as "upcoming features". Firstly, it would give the sales team more ammunition to sell as requested from their side. Secondly, we can see how potential customers would respond to the upcoming features.

It soon became clear that one of the "upcoming features" caught more attention than the others. An audience filtering so that fund managers could choose which type of investors would be allowed to the content. This led to the salespeople requesting that the feature be prioritized.

Hearing the response the salespeople were getting on that feature, we decided to talk to the potential customers to understand why they were intrigued by that feature. We learned that due to compliance, some investments (e.g. Hedge Funds ) are not allowed to market themselves or give financial advice to retail investors. If a retail investor loses money based on the hedge fund's content, he/she can sue the hedge fund. Even if the asset management company has a good case, they still have to pay for a lawyer and meet up in court. For that reason, some fund managers would be very anxious about where the content lands.

Conducting Usability Tests

We conducted 5 usability tests with investor users. According to Jakob Nielsen ( leading usability expert ), 4-5 users is the ideal number, everything after that offers diminishing returns. The purpose was to uncover any usability issues and understand the users' preferences.

For that, we prepared a list of tasks that a real user would perform (e.g. watching a video, finding a factsheet, etc.). We also reminded participants that we, to keep them be relaxed and act naturally. During the test, the participants were asked to"think out loud". Meanwhile, we would observe and note down if they were able to perform the task.

Finally, the frontend devs were invited in to watch the usability tests so that they could get a sense of a how a user would interact with the product.

Before the usability test (example).
Issues with the tab bar. 1 ) It is difficult for test participants to find it. 2 ) Test participants were unsure what the tab buttons meant. There was no label on any of the buttons.

After the usability test, we changed the tab bar. Icons are accompanied by labels. The tab bar takes is also more prominent, making it easier to spot.

Impact

At the time of the writing, we to onboarded +120 funds subscribing for $1000/year for a fund profile. Some of them pay for 2-3 fund profiles. Our list of customers includes fund managers from all over the world and within every asset class. They range from small one-man shops to notable asset management companies ones such as Franklin Templeton with a 1.5 trillion AUM. We also increase of saw an increase from 1-2 funds to 3-5 funds every month.