UBS has decided to shut its robo-advice offering in the UK and sell the intellectual property to a company based in San Francisco, Wealth Manager can reveal.
The wealth firm has decided to sell UBS SmartWealth, which was officially launched in February 2017, to SigFig, a US-based start-up, for an undisclosed sum.
The decision was taken following a review of the robo-advice service. While head of wealth management UK and Jersey at UBS, Eva Lindholm said the bank was satisfied with the initial commercial progress of the robo-adviser, it was decided that UBS should prioritise investment elsewhere, for its core client base.
It is unclear how many assets or clients SmartWealth attracted since launch.
A number of staff at SmartWealth will join SigFig as part of the transaction. Meanwhile, one of the creators of SmartWealth, Shane Williams has left to join AQR Capital, the $226 billion hedge fund, as head of client technology.
The move to close down SmartWealth follows a restructure at UBS Wealth earlier this year.
The bank merged its US and global wealth divisions into a new unit, Global Wealth Management, continuing its plans to streamline operations.
Martin Blessing, president of wealth management, and Tom Naratil, president of UBS Americas and wealth management Americas, were appointed co-presidents of the new division.
Lindholm (pictured) pointed out that UBS will look to incorporate some of the technologies from SmartWealth into its core offering. This has already started with the introduction of its Advice Advantage service in the US.
She stated: 'We are proud of the award-winning technology we have developed and were satisfied with the initial commercial progress of UBS SmartWealth.
'Having conducted a thorough assessment, however, at this time we believe the near-term potential is limited and have therefore decided to close our digital-only offering in the UK. We are pleased, however, to have entered into an agreement to sell the intellectual property relating to UBS SmartWealth to SigFig – a financial technology firm that we have an equity stake in and with whom we've been working for two years in the US.'
SigFig was founded in 2007 and has been selling software to established financial institutions. Led by CEO Mike Sha, the company raised $50 million back in June from investors, to put towards expanding its services and developing new technology.
The funding round was led by General Atlantic and included UBS Group among others.
Lindholm added: 'We believe the decision serves the best interests of the business and will allow us to invest further in other client-facing improvements, whilst sharing in the future success of the IP we have created via our equity holding and ongoing partnership with SigFig.'