Latest / Financial Planner Life Podcast / Why Financial Advisers Shouldn’t Sign Long-Term AI Contracts | Hardy Michel, Marloo

Transcript

Why Financial Advisers Shouldn’t Sign Long-Term AI Contracts | Hardy Michel, Marloo · Financial Planner Life Podcast

0:04
SPEAKER_01: And today on the Financial Planner Live podcast, we discussed AI with Hardy Michael.
0:10
SPEAKER_01: He's the founder of Marlo.
0:12
SPEAKER_01: He has decided to go slow to go faster.
0:15
SPEAKER_01: He's gone around the world talking to lots of different financial planners in lots of different firms to understand the behaviours and the barriers stopping financial planners from delivering excellent advice.
0:27
SPEAKER_01: You are going to love this episode if you want a clear, understandable route to entry to AI, and be sure to check out the notes section for a free demo and try.
0:41
SPEAKER_01: Hardy, thank you for joining me today on the Financial Planner Live Podcast.
0:44
SPEAKER_01: How are you?
0:45
SPEAKER_01: Fantastic.
0:45
SPEAKER_01: Great to be here, Sam.
0:46
SPEAKER_01: Amazing.
0:47
SPEAKER_01: Listen, first off, tell us who Marlu are and how you're supporting financial planners.
0:52
SPEAKER_02: Yeah, so Marlu is an AI partner for financial advisors and planners.
0:57
SPEAKER_02: And what we do is, you know, very simply, advisors meet the client, and Marlu takes care of everything else.
1:03
SPEAKER_02: And like practically what that looks like is right across the advice workflow from you know first meeting to final document, we try and do as much of the heavy lifting as possible.
1:13
SPEAKER_01: Love it.
1:13
SPEAKER_01: Okay.
1:14
SPEAKER_01: So there's a lot of competition in the AI space.
1:17
SPEAKER_01: Plenty of people contacting me coming on the podcast.
1:19
SPEAKER_01: What makes you different than Marlu in comparison to the um the different businesses that are out there now currently saying that they're the next best thing for financial companies?
1:27
SPEAKER_02: It's a great question.
1:28
SPEAKER_02: There's a lot of noise out there, right?
1:29
SPEAKER_02: And like we're in a contradiction at the moment where two things are true.
1:32
SPEAKER_02: One, like the potential of AI has never been greater to have a positive impact on people's lives.
1:36
SPEAKER_02: And two, on the other end of that scale, people have also never been more exhausted by the noise out there.
1:42
SPEAKER_02: So I think like, you know, to very succinctly answer that question, and I can maybe segue that into some of our background as well.
1:49
SPEAKER_02: But beautiful, simple, intuitive software that advisors love to use.
1:54
SPEAKER_02: And our, you know, design ethos and philosophy is the fewest possible clicks, preferably zero clicks in order to achieve and do anything.
2:02
SPEAKER_02: And anecdotally talking to advisors, that is a breath of fresh air in what is getting them so excited about using our product.
2:08
SPEAKER_01: I love it.
2:09
SPEAKER_01: I say, well, before we get stuck into Marlu a little bit further in the work you were doing with financial planners and what you're doing internationally, if you just take us back and just tell us a little bit about you, your background, your career, and how you ended up heading up MALU and building AI for financial planning companies globally.
2:23
SPEAKER_02: Yeah, it's a great question.
2:24
SPEAKER_02: So uh I'm originally from New Zealand, as you can probably tell from my uh from my accent.
2:30
SPEAKER_02: Ended up in the UK accidentally.
2:32
SPEAKER_02: Um, but I helped build a business in New Zealand called Shares Ease, which I'll describe as the revolute or the Robin Hood of New Zealand.
2:39
SPEAKER_02: We started very simply with a retail investing platform in a country where banks, you know, were the incumbents and you had to fill out a paper form in order to try and invest and create an account, uh, which I, you know, tried and and stumbled through myself.
2:52
SPEAKER_02: And the whole premise was just like a beautiful retail investing app for the people of New Zealand.
2:58
SPEAKER_02: And over a period of five years, we went from, you know, zero, five or six of us in a room, to, you know, more than 20% of the New Zealand population as our user base, billions of assets under management, you know, New Zealand household name and brand, and 250 employees as well.
3:14
SPEAKER_02: So it was a real roller coaster and journey and something that was really special to be part of.
3:18
SPEAKER_01: That's pretty incredible.
3:20
SPEAKER_01: So just gonna ask you at that point as well.
3:22
SPEAKER_01: When you're working in that retail investment platform space and there is um a distinct lack of competition where you were in New Zealand, didn't you think at that time how could financial planning be incorporated into a retail investment platform?
3:35
SPEAKER_02: Yeah, it was front of mind on a daily basis.
3:37
SPEAKER_02: So, you know, for example, I ran things like customer support or financial crime and compliance.
3:41
SPEAKER_02: And so either through customer queries that were coming through or things like, you know, enhanced due diligence or source of fund, source of wealth for larger depositors, I would typically end up on the phone with people.
3:51
SPEAKER_02: And over those, you know, years, I've probably been asked tens of thousands of times, what should I do with my money?
3:57
SPEAKER_02: Should I buy or should I sell?
3:58
SPEAKER_02: Am I doing the right thing?
4:00
SPEAKER_02: And my takeaway from that was, you know, by and large, people want to do the right thing with their money.
4:05
SPEAKER_02: They want to build wealth and they're engaged, they're willing to do so.
4:09
SPEAKER_02: But human psychology is such that it's incredibly difficult to actually stay the course and, you know, execute against plan.
4:17
SPEAKER_02: And if we were to, you know, say to people in moments of Trump tariffs or the pandemic, we actually couldn't say anything.
4:25
SPEAKER_02: So all I could do was send an email out to like a million customers saying some, you know, variation of don't panic, the market goes up, the market goes down, you're in this for the long run, and then probably insert a chart of the S P 500, you know, to kind of imply, you know, indirectly that we could be in one of these little drops here.
4:42
SPEAKER_02: And in fact, you know, historically over time the market has returned 7%.
4:46
SPEAKER_02: Um, and so it was frustrating when we would see the opposite happening now.
4:50
SPEAKER_02: And I've seen this all around the world at different platforms behind the scenes.
4:53
SPEAKER_02: I've seen the data buy high, sell low in those moments.
4:56
SPEAKER_02: And so, you know, my summary of kind of this advice problem in the gap is it's not necessarily that there's bad advice out there, it's just a lack of great advice available to people.
5:05
SPEAKER_02: And more often than not, we're scared to give it when we know very simply for the majority of the population what they should do to build wealth over time.
5:14
SPEAKER_02: And so that was kind of the spark for us.
5:16
SPEAKER_02: And through this, we looked at, you know, robo advice.
5:19
SPEAKER_02: Do we bring advisors on platform to advise on portfolios?
5:22
SPEAKER_02: Do we build our own wealth management business and spent kind of a bunch of time exploring this over the course of a few years?
5:29
SPEAKER_02: It was in the form of some board papers, it was in time of spending time with different advisors, and you know, ultimately arrived at the conclusion that this was a problem that we could go out and help to solve ourselves because of that belief.
5:40
SPEAKER_02: Um, you know, hey, there should be more great advice in the world.
5:43
SPEAKER_02: And we went, when we went and spent time with advisors, um, we were blown away by, you know, how frustrated they had become and you know, some of these like massive macro forces that were acting on them and making their lives really, really tough.
5:57
SPEAKER_02: Um, and the ultimate observation was, hey, you got into this business to be, you know, client-facing people first, like build relationships.
6:04
SPEAKER_02: You're spending the majority of your time not doing that.
6:06
SPEAKER_02: Like, where did this all go wrong?
6:09
SPEAKER_01: So the retail investment platform you built with Sherzy, you built that first for the retail client in mind.
6:15
SPEAKER_01: Then came the decision, then came the exploration into advice.
6:20
SPEAKER_01: So as the markets go up, markets go down, people aren't just knee-jerk reacting, taking their money out because obviously it's just their choice, right?
6:27
SPEAKER_01: So I love the fact you started with the platform, the retail investment platform.
6:30
SPEAKER_01: To me, in my head, it feels like it must be easy just to then add advice to that.
6:35
SPEAKER_01: Did you add advice to that, or was it something that didn't work?
6:40
SPEAKER_02: Um, it didn't quite work in its form at the time.
6:43
SPEAKER_02: So we were looking more at robo advice at the time.
6:45
SPEAKER_02: And I think my reflection on that was twofold.
6:49
SPEAKER_02: Like, robo advice is extremely good at following logic and some kind of methodology or framework, right?
6:56
SPEAKER_02: Like given XYZ about you, we will put you into one of these, you know, portfolios based on your risk appetite, essentially.
7:04
SPEAKER_02: Um, what it doesn't solve for is psychology or human behavior.
7:07
SPEAKER_02: And I think that's ultimately where it falls down, right?
7:10
SPEAKER_02: Like we would all be using robo advice if it had solved the human psychology aspect of investing.
7:16
SPEAKER_02: And, you know, in fact, it's not just investing in should I buy or should I sell, but it's the kind of broader financial picture and body, whether it's, you know, tax or inheritance planning, like, etc.
7:26
SPEAKER_02: There's a lot more complexity and life-driven events that come into the fold.
7:30
SPEAKER_02: Um, and so it solves one small segment and it doesn't solve the behavioral aspect.
7:35
SPEAKER_01: Gotcha.
7:35
SPEAKER_01: So why not then set out that wealth management business that was aligned to that platform and then dominate?
7:41
SPEAKER_02: Yeah, really good question.
7:43
SPEAKER_02: Um You're starting to see this now, I think, you know, even five plus years later after that kind of like initial observation and point with the likes of Revolute setting up a private bank.
7:53
SPEAKER_02: I think for advisors, like I would just take that as really good signal that, you know, the service you deliver is in demand.
7:59
SPEAKER_02: The fact that other people are going, wow, like there's a huge opportunity here.
8:04
SPEAKER_02: Um, so I would take that one as a good signal, but two, at the time and like the premise and the principles for starting Malu and building product in the company is always ground yourself in you know the pain and the problems of your customer.
8:17
SPEAKER_02: So if you think about building like a, you know, an AI native wealth manager from scratch, essentially, you're jumping to the far opposite spectrum and um you're making a ton of assumptions.
8:28
SPEAKER_02: And so for us, it was focus on the advisor.
8:31
SPEAKER_02: They're, you know, in the field every day dealing with clients, they're most acutely feeling all this pain.
8:36
SPEAKER_02: And that's the best place to start solving problems.
8:40
SPEAKER_02: And sure you can, you know, expand from there, but I just think the risk of going all the way end to end and saying, you know, uh a grandiose statement to the effect of we're gonna solve this and we're gonna build a bank is probably a little far removed from the reality um of what it actually takes to do and deliver that to a really high standard and scale.
9:00
SPEAKER_01: So why not just like I can understand going all the way to the end and then saying like we're gonna build this AI solution for these um, you know, uh Sharesy, right?
9:08
SPEAKER_01: Um but you could have had the human element instead of just going straight to the end of AI.
9:12
SPEAKER_01: How come you didn't proceed with the human uh element of uh advice attached to Sharesy?
9:18
SPEAKER_01: I'm just just interested because I look at the the likes of Revolute, Monzo, etc., I think, why haven't they got financial advisors?
9:23
SPEAKER_01: They're capturing the market really well, they're making things really easy for banking.
9:27
SPEAKER_01: Why aren't they also introducing like coaching or financial planning where you can log in and speak to somebody?
9:33
SPEAKER_01: Like I'm just really intrigued as to why that connection didn't happen within um within Cherzy.
9:39
SPEAKER_02: Yeah, I think people are coming around to it now.
9:41
SPEAKER_02: At the time it was, you know, sentiment, um, particularly what, you know, like venture capital investors were rewarding was very much robo-focused.
9:50
SPEAKER_02: Right.
9:50
SPEAKER_02: Um, I would say from a perspective of, you know, like on paper, it appears to be sexier and more scalable.
9:57
SPEAKER_02: Um but I think everyone is coming around to the fact that it's like human-led advice is here to stay, and that's actually the way to go, which is now what you're seeing playing out in terms of a trend, in my opinion.
10:08
SPEAKER_01: Do you think your revolutes, etc., are going to go down the route of bringing in human advice, or do you think they're gonna double down on AI?
10:14
SPEAKER_02: Um I think it'll be a mix over time.
10:16
SPEAKER_02: I think like human advice is here to stay, it will be technology augmented and supported.
10:22
SPEAKER_02: And that's like very much our ethos and you know how we are building the product.
10:26
SPEAKER_02: It's you know, around the human who is, you know, spending the time with the client and delivering their service and supporting as much of the heavy lifting around that as possible so that you can deliver in your style and you know to the level of like care and personalization that you strive to.
10:44
SPEAKER_01: So you mentioned to me go slow to go fast, right?
10:48
SPEAKER_01: So you also talked to me about the psychology and the behavior of advisors.
10:51
SPEAKER_01: So what did you do from a research capacity that got you really ingrained with the advisor community?
10:57
SPEAKER_01: Was it in New Zealand or was it bigger than that?
10:59
SPEAKER_02: Yeah, great question.
11:00
SPEAKER_02: So I actually ended up uh in the UK because I was headhunted for a role over here uh first to surprisingly build another retail investing platform.
11:09
SPEAKER_02: Uh so have spent a bunch of time doing that now.
11:12
SPEAKER_02: And this was one called Lightyear, which we launched across 22 different European countries in the UK as well.
11:17
SPEAKER_02: And so essentially building from scratch another, you know, licensed um retail brokerage.
11:23
SPEAKER_02: And again, that was a great experience for me because it just confirmed kind of everything that I'd seen in New Zealand, which um, you know, by comparison is a very small market.
11:31
SPEAKER_02: And so just opened my eyes really to the fact that, hey, like this is true across the world.
11:36
SPEAKER_02: Um, I now have so many proof and data points as a result of this.
11:40
SPEAKER_02: And um, we were just really fired up to go and build a company to go out and solve this.
11:45
SPEAKER_02: So I teamed up with uh Shaq Shaquille, who's my co-founder.
11:48
SPEAKER_02: We met at Cherzies and worked there together.
11:51
SPEAKER_02: And uh essentially what we did was we were able to raise a little bit of money to spend a year executing what we called like the go fast, go slow to go fast strategy.
12:01
SPEAKER_02: And so essentially what that looked like was um we are gonna be like super focused but not resource constrained in terms of capital to go and spend the time in this space of financial advice and go deeper than anyone else.
12:14
SPEAKER_02: And so what that looked like was ultimately we was we spent six months in-house across a range of you know advisors and and planning firms from you know your IFA all the way up to you know an enterprise level or like nationwide firm with a call center.
12:28
SPEAKER_02: And we did that in multiple countries.
12:30
SPEAKER_02: So we did it in Australia, we did it in the UK, for example, and kind of two things were true of that experience.
12:38
SPEAKER_02: One, we went incredibly deep.
12:40
SPEAKER_02: And the way that we did that is we essentially spent you know, days at a time with every single different role and persona within an advice firm from your you know, managing director, CEO, through to your head of compliance, through to your practice manager, advisor, power planner, call center, um, across a variety of different businesses.
12:58
SPEAKER_02: And we did two things.
12:59
SPEAKER_02: We did informational interviews like this, but then we were also doing you know a lot of side-by-side kind of desktop-based stuff, like let's go through every email in your inbox from yesterday.
13:07
SPEAKER_02: What is it?
13:08
SPEAKER_02: What do you do with that information?
13:09
SPEAKER_02: Where does it go to really try and like map the logic of the advice workflow um, not just between the advisor and the client and the particular meeting they have, but how that kind of like ripples across the whole firm and all the different people it touches.
13:23
SPEAKER_02: And so, like, you know, I'm not an advisor by trade or background, but we really use that as an opportunity to go deep into the weeds and kind of have an objective, like bird's eye view of within a firm, how does this actually work?
13:36
SPEAKER_02: And where in particular does the friction accrue on, you know, a day-to-day basis and for us to observe?
13:42
SPEAKER_02: Because I think two things can be true.
13:44
SPEAKER_02: Like, people can tell you their pain points or what they think is wrong.
13:47
SPEAKER_02: Um, but more often than not, uh, the the real problem is kind of like below surface level.
13:53
SPEAKER_02: Um, and so kind of the two takeaways from the six months across multiple countries was um, hey, the software that you're using on a daily basis sucks.
14:04
SPEAKER_02: Like it fights you.
14:05
SPEAKER_02: It's Windows 95-esque, it's very clunky, and it doesn't, you know, align with any other type of modern consumer experience that you would use outside of your, you know, like professional, professional life.
14:16
SPEAKER_02: If you were to compare it to, say, Strava or Instagram or Spotify.
14:21
SPEAKER_02: Like it doesn't stack up.
14:23
SPEAKER_02: It's not delightful to use.
14:24
SPEAKER_02: You don't go home and tell, you know, your family about the great experience you had with your like, you know, cash flow modeling or like your your CRM software, right?
14:32
SPEAKER_02: So that was definitely true.
14:34
SPEAKER_02: And then the second thing was, you know, hey, essentially you got into this profession to be, you know, people first.
14:41
SPEAKER_02: Um that's where you're best, and you're spending the majority of your time not doing that.
14:46
SPEAKER_02: And the core reason for that is, you know, the compliance and admin burden has gone through the roof.
14:51
SPEAKER_02: And ultimately what that correlates to is like your cost to serve each customer increasing, and you have had no levers to kind of like fight back against that.
15:00
SPEAKER_02: And so, you know, you can walk into a one-hour review meeting with a client and you can walk out with 10 hours worth of work, which is crazy, right?
15:08
SPEAKER_02: And by the time you see four or five clients over the course of a week, you have a two-week backlog, or you need to outsource or hire support staff, like it's destroying the economics of your business.
15:18
SPEAKER_02: And so you almost end up in a state, and this is, you know, my perspective, um, just from you know, observation, where almost more client meetings is bad for business.
15:27
SPEAKER_02: Um, or in a sense of you just close off your client book and you become extremely selective about kind of who who you bring on board.
15:35
SPEAKER_02: And um kind of the upshot of all of that and what we strive to create with Marlu is yeah, something that's beautiful, simple, and intuitive, like it's a delight to use.
15:44
SPEAKER_02: And that comes from our retail and consumer backgrounds.
15:48
SPEAKER_02: Like we're very good at building consumer grade products.
15:50
SPEAKER_02: How can someone sign up within two minutes, like self-serve and on board and try the whole thing without having to pay for it?
15:56
SPEAKER_01: Um something you said there now, the penny drops, being consumer focused and building something for the average Joe or Sam, like me, right to actually use and go back to and enjoy using it.
16:07
SPEAKER_01: Yeah, you're now creating that for financial planners internally, so they feel happy to use it.
16:13
SPEAKER_02: Exactly.
16:13
SPEAKER_02: And from our perspective, the best thing is an advisor signs up.
16:17
SPEAKER_02: It could be anyone in an advice firm.
16:19
SPEAKER_02: Like, this is the magic now because everything's typically been procured compliance first, top down, it gets forced on the advisor, right?
16:26
SPEAKER_02: And you have no choice in the matter and you go, I don't want to use this, or what am I trading off?
16:30
SPEAKER_02: Or it's just like another, you know, bloody tool to have to use, quite frankly.
16:34
SPEAKER_02: Whereas from our perspective, it's like you build with the advisor at the core, you give them a delightful experience, and then what we have seen is a huge amount of like love and evangelism as a result.
16:45
SPEAKER_02: So we know that everyone is very tightly networked, it's like a high trust profession and industry.
16:51
SPEAKER_02: And so for one person to then organically go and say to another person, hey, I tried MALU, I had a great experience, or you should try it, that's kind of the aha or the delight moment for us that has um like given us such a good start.
17:03
SPEAKER_01: Hi, sorry for interrupting this episode, but I just wanted to let you know that it's sponsored by Red Mill Advanced.
17:09
SPEAKER_01: They're the UK's leading provider of interactive e-learning courses, specifically for the financial advice sector.
17:16
SPEAKER_01: Their best in class e-learning, CPD courses span technical knowledge, leadership and management skills, business skills and compliance knowledge, while their exam support courses help your people pass their CII, CISI and NIBF exams first time.
17:32
SPEAKER_01: It's all delivered on a powerful learning platform that makes reporting CPD to the FDA seamless and gives leadership teams full knowledge and skills visibility across their entire organisation.
17:46
SPEAKER_01: That's why companies like St.
17:47
SPEAKER_01: James's Place, Quilter, PLC, Hascot Lloyd, Foster Lenovo, and DeVere trust Redmill to keep their advisors and wider teams competent, compliant, and at the top of their game.
18:00
SPEAKER_01: So to book a free demo, get yourself to redmilladvance.com and they'll do the rest.
18:06
SPEAKER_01: Yeah, I love that.
18:07
SPEAKER_01: So the user experience from a financial planner perspective, taking what you've learned from the consumer-focused platform and bringing that in-house to make it a beautiful experience.
18:15
SPEAKER_01: Absolutely love it.
18:16
SPEAKER_01: What about the behaviours and the psychology then?
18:18
SPEAKER_01: So when you go into these businesses and you're doing these deep dives globally across all different businesses, you know, were you coming up against sort of psychological barriers where people felt that they, oh no, that's new, we can't do that, we can't change the process.
18:29
SPEAKER_01: Uh and also just like were you were you sort of recognizing areas where you could improve well-being perhaps for the advisor itself?
18:36
SPEAKER_01: Like I say, you go into a meeting, you do an hour, you come out, you've got you've got 10 hours of work to do.
18:40
SPEAKER_01: Most people who enjoy conversations and relationships and winning the client and solving problems cannot stand administration, right?
18:46
SPEAKER_01: I hate it.
18:47
SPEAKER_01: Like I take in on Hannah and she does mine, and I'm I feel like a new man.
18:50
SPEAKER_01: Like it's amazing, right?
18:51
SPEAKER_01: So if you've got something in the background that's going to be doing that for you automatically whilst you're in that meeting taking notes, that's pretty impressive stuff.
18:57
SPEAKER_01: So were you finding that you were building something with the psychological improvement of well-being in mind for those individuals as well?
19:04
SPEAKER_02: Yeah, yeah, absolutely.
19:06
SPEAKER_02: Like the number of conversations that I've had with advisors where they've been extremely candid and said, like, you know, I can't take on anymore.
19:13
SPEAKER_02: I am being absolutely crushed here.
19:15
SPEAKER_02: My, you know, job satisfaction is diminishing has really surprised me.
19:19
SPEAKER_02: Like I had one as recently as yesterday where someone jumped on a demo for the product and it's just like, hey, I really need some help here.
19:26
SPEAKER_02: And, you know, that's like our cue and like a massive role that we can play to say, like, all right, let's strip it back to first principles.
19:34
SPEAKER_02: Like we can all agree that, you know, like you want levers and like leverage on your time and you want to be doing less of you know the admin and compliance.
19:45
SPEAKER_02: It doesn't mean that you, you know, are not across the output, so you absolutely have to review them.
19:50
SPEAKER_02: But if I was to tell you that, hey, we can cut an annual review report from three hours down to 20 minutes, do we agree that's like a net positive thing for you?
19:58
SPEAKER_02: Like everyone will say yes.
19:59
SPEAKER_02: And so, you know, the second thing that we'd come up against is um, you know, AI can feel confusing, it can feel like threatening at times to people.
20:08
SPEAKER_02: And so we always just lead with um, you know, the human and the advisor first.
20:12
SPEAKER_02: So if we can agree that, you know, these things are true, i.e., you would like to spend less time and that would actually have a huge impact in your day and week, then from a product and a design perspective, that's a challenge for us to go to work out and go, what is the quickest, simplest, most intuitive way for us to deliver that to you and to also get you up the curve because it can be scary and daunting for an advisor.
20:35
SPEAKER_02: And it's also where we're extremely hands-on with the product.
20:38
SPEAKER_02: We have um, you know, a third of our team, 10 people now, are ex-advisors.
20:43
SPEAKER_02: And so there's nothing better from a support and an onboarding perspective of you sitting down with someone else who was in your shoes as a subject matter expert and can help you very quickly get up to speed.
20:55
SPEAKER_02: And so, you know, we'll say like if you give us 30 minutes, we'll get you onboard and up to speed, and you'll never have to take meeting notes again.
21:01
SPEAKER_02: Or if you give us 45 minutes, we'll solve the annual review problem for you.
21:06
SPEAKER_02: And it's not just we'll solve it, but you'll have your exact document, template, styling, you'll never have to like edit or amend again.
21:14
SPEAKER_02: Um, so from a you know, behavioral and psychology perspective, like what we've learned is it's going in being human first and focused, and then our challenges to design software experiences uh around that that kind of like accommodate and lean in.
21:29
SPEAKER_01: Have you found that up against the competition in the AI space for financial planning is they've gone directly to AI and not to the human space?
21:34
SPEAKER_01: So are you are you finding that?
21:37
SPEAKER_02: Yeah, for sure.
21:38
SPEAKER_02: And I think like I'm seeing poor behavior across the board from a number of other AI first players who are either locking people into long-term contracts without them actually, you know, fully getting to grips with the product, um, who are asking for a lot of money up front to build and do certain things that just do not cost or take that much time at all.
22:00
SPEAKER_02: And so it's kind of like the principles and the consumer first approach um like aren't true.
22:06
SPEAKER_02: And so for us, it's deliver value.
22:09
SPEAKER_02: We never hard sell the product.
22:11
SPEAKER_02: It's always for the advisor to make their own decision and also for tell us how you would like to be helped or the questions that you have, like what are the barriers?
22:18
SPEAKER_02: And we'll absolutely give you as much time as as is needed.
22:21
SPEAKER_02: Um but beyond that, it's very much, hey, you can try it out, you can make your own purchasing decision versus other people in the market who have been, you know, essentially like money hungry and I would say like not aligning with the interests of the end advisor or client, which has been disappointing to see.
22:38
SPEAKER_01: Do you think it's to lock them in essentially for a set period of time?
22:42
SPEAKER_01: So, you know, you've got them on that recurring income for as long as long as possible.
22:45
SPEAKER_01: So like 12 month, 20 more, 24-month contract.
22:48
SPEAKER_01: I mean, what do you do?
22:49
SPEAKER_01: Do you do contracts on yours or?
22:50
SPEAKER_02: No, we do monthly.
22:51
SPEAKER_02: So this is another kind of controversial um piece for us.
22:54
SPEAKER_02: So I would just say that like AI is moving so quickly at the moment that my advice to advisors, even if it's against my own personal commercial interests, is um don't lock in.
23:06
SPEAKER_02: Why would you lock in?
23:07
SPEAKER_02: And so the number of people that we've seen have been overpromised and under-delivered have gotten six months in and the adoption in their firm isn't actually there, or the product hasn't kept pace with the expectations of the advisor or the firm has been pretty astounding.
23:21
SPEAKER_02: And so you end up in this situation where you made good decisions with the information you had at the time that has proven um not to necessarily be true through no fault of your own.
23:32
SPEAKER_02: And then you get stuck in this um kind of state where you can't move forward and you're going backwards and you're not making the most of this technology.
23:40
SPEAKER_02: And, you know, for example, last week I talked to an advisor and they'd been around two other like firms and products, had subpar experiences with both of them.
23:49
SPEAKER_02: Um, and then they come to me and all I can say is like, I'm really sorry that happened.
23:54
SPEAKER_02: Um like that's inexcusable.
23:57
SPEAKER_02: And the best thing for you to do with Maru is just sign up and try the product and let me know if you have any questions or need help, but you can experience the whole thing without having to pay or lock yourself in.
24:06
SPEAKER_01: Let's talk about that.
24:07
SPEAKER_01: Let's talk about the product you offer and the user experience.
24:10
SPEAKER_01: So take us through that journey.
24:11
SPEAKER_01: So if someone's interested right now in Marlu and they can go to the comment section, they can, you know, they can click a link and they can book a demo.
24:16
SPEAKER_01: So tell us a little bit about that as well.
24:18
SPEAKER_01: Tell us a little bit about from interest to actually execution and implementation.
24:22
SPEAKER_01: And just talk us through the whole process.
24:24
SPEAKER_02: Yeah, so we're super happy to run demos.
24:26
SPEAKER_02: Anyone can book them directly off our website, they'll be available same all next day, and you'll get a fantastic member of our team who will listen, understand what you're trying to achieve, and very quickly give you an overview of what's possible.
24:37
SPEAKER_02: We also always live demo the product.
24:39
SPEAKER_02: So the thing you see in a demo is real.
24:42
SPEAKER_02: It's exactly what advisors are using day to day.
24:44
SPEAKER_02: It's not, you know, some shadow environment or a, you know, like proxy representation of what the actual end user experience is.
24:52
SPEAKER_02: That's the first thing.
24:53
SPEAKER_02: And then the second thing is onboarding is literally go to our website, malu.com, click, you know, like create an account or log in, and it takes two minutes.
25:04
SPEAKER_02: And so within a few minutes of signing up, you can have Marlu join any client meeting and take notes in person and online.
25:12
SPEAKER_02: So that is kind of the key and crux use case of the product.
25:16
SPEAKER_02: Client meetings are like high pain, high frequency.
25:19
SPEAKER_02: And what we're essentially doing is we're collapsing the value stack or the time to value.
25:24
SPEAKER_02: So what that means is you can go from like first experience to getting value in the form of like custom meeting notes in your style time and format in minutes, um, which is really special for advisors, I would say, and it's not typically an experience that they're used to.
25:40
SPEAKER_02: And so you finish with the meeting with your client in person, like this.
25:43
SPEAKER_02: You can do a mobile app recording online.
25:45
SPEAKER_02: We do any online meeting type.
25:47
SPEAKER_02: And then within 30 seconds of that meeting, you have the transcript.
25:50
SPEAKER_02: You can apply a template.
25:52
SPEAKER_02: So what we've learned is that advisors, you know, have a really high level of personalization and customization.
25:58
SPEAKER_02: It's not just firm to firm, but it's advisor to advisor within that firm, which has been a learning for us.
26:02
SPEAKER_02: And so we allow you to, you know, upload and add your own styling, formatting templates.
26:09
SPEAKER_02: So you could finish a meeting and you could have a client-facing version of those notes.
26:14
SPEAKER_02: You could have an internal compliance record, you can have a power planner brief.
26:17
SPEAKER_02: So you can kind of very easily set up and customize your own outputs.
26:21
SPEAKER_02: And then, like, where does that lead from there?
26:23
SPEAKER_02: Kind of the remainder of the advice workflow.
26:25
SPEAKER_02: So you can create tasks and track them.
26:27
SPEAKER_02: You can automatically fill forms.
26:29
SPEAKER_02: You can never have to do an uh, you know, a custodian onboarding or a platform onboarding form.
26:33
SPEAKER_02: Again, it can get autofilled from the data, for example.
26:36
SPEAKER_02: Um, and then the very last piece is, you know, report writing.
26:39
SPEAKER_02: So, and your review letters, uh, suitability reports.
26:42
SPEAKER_02: You can do policy analysis, for example.
26:45
SPEAKER_02: Um, that's the direction that we're heading in.
26:47
SPEAKER_01: Okay, love it.
26:48
SPEAKER_01: And when you said about like a power planner brief compliance, does that mean that it's actually going to check it from a compliance perspective and from a power planning perspective, and then come back to you with the research so you can execute with the client in the next meeting, or is it just preparing the power planner to do their part of the job?
27:03
SPEAKER_02: Yeah, so uh it's the latter there.
27:06
SPEAKER_02: So um it's collaborative as well, which is a you know great advantage of ours essentially.
27:11
SPEAKER_02: So you can set up your firm to have different, you know, permission levels and access levels, which means that power planners can be across clients and client meetings.
27:21
SPEAKER_02: So if you're meeting someone in person on the other side of the country, your power planner, wherever they are, as soon as that note's uploaded, they can begin to, you know, generate the summary action, like actually undertake and follow-up.
27:32
SPEAKER_02: So there's no lag there, it's very collaborative.
27:34
SPEAKER_02: So, you know, you can have multiple advisors on one client, you can have multiple power planners across multiple advisors.
27:40
SPEAKER_02: And so that just means that everyone gets access to the same platform and product and then the same view of the client across the board.
27:49
SPEAKER_02: And then in terms of, you know, do we, you know, provide checking or compliance?
27:54
SPEAKER_02: Like, no, it's very much driven by the advisor.
27:57
SPEAKER_02: Like in the templates that you'll create, you'll specify, you know, the particular outputs or things that you need to see in the document.
28:04
SPEAKER_02: And again, at the end of the day, like it's your responsibility to review.
28:08
SPEAKER_02: So Marlo is very much like productivity led and it's still on the advisor to review and to be happy with the outputs.
28:14
SPEAKER_02: And we provide you the tools to like edit and also provide feedback on that very, very easily.
28:18
SPEAKER_01: Are you going to move into the space of doing like AI for compliance and power planning as well?
28:22
SPEAKER_01: Or is that like further on is it further on down the line, or is it not part of your business plan?
28:26
SPEAKER_01: Do you see it, do you see it as a value add or not?
28:28
SPEAKER_02: Yeah, it it definitely is from the perspective.
28:31
SPEAKER_02: There's kind of two two views on this.
28:33
SPEAKER_02: It's like um one, like we are trained on, you know, like the FCA regulations and and guidance, and maybe we can kind of talk about like the multi-country approach in a second and why that's been important.
28:46
SPEAKER_02: So like we are contextualized to the UK or in fact any country that an advisor is using Malu from.
28:52
SPEAKER_02: That's that's the first thing.
28:54
SPEAKER_02: Um but two, again, like I'm not gonna tell you what's right or wrong.
28:58
SPEAKER_02: Like you have that level of knowledge and like ultimately you're the one that's signing off on the product.
29:03
SPEAKER_02: As far as like compliance monitoring and sampling goes, it's definitely something we're thinking about.
29:08
SPEAKER_02: We always, you know, very actively participate in like user research and feedback with advisors, which again can be like a foreign experience for them and something that's quite fun.
29:16
SPEAKER_02: But essentially we say that, you know, sit down and go, hey, if you could wave a magic wand in the air and design, you know, a compliance monitoring or a sampling tool, what would that look like?
29:25
SPEAKER_02: Um, and that's kind of where the magic comes from, where we listen, we observe, we probe, we ask questions, and then we go away and say, based on everything we know and everything that we've canvassed, like what could the best solution be here?
29:36
SPEAKER_01: Okay.
29:36
SPEAKER_01: Tell us a little bit, I just want people to understand as well where you are in the journey with Mardu.
29:40
SPEAKER_01: Okay.
29:40
SPEAKER_01: You're not in your back bedroom, are you making this right this second and pushing it out to financial advice firms globally?
29:46
SPEAKER_01: You know, how long has it been about?
29:47
SPEAKER_01: Where are you in the journey?
29:48
SPEAKER_01: Have you raised investment?
29:50
SPEAKER_01: What countries are you working in?
29:51
SPEAKER_02: Yeah, yeah, great question.
29:53
SPEAKER_02: So we are two years into the journey, and I would split that as a year during the go slow to go fast strategy, where we just listened, we didn't write a line of code, and we just sat there.
30:03
SPEAKER_02: Um, and that can be really hard to do for people, right?
30:06
SPEAKER_02: Um, in terms of like bias to action and wanting to just like jump straight into solutions mode.
30:10
SPEAKER_02: But we sat there and we listened and we came out with a very clear vision of the pain point we were solving and the product that we needed to deliver, and more importantly, how that would rapidly evolve over time, kind of beyond this note-taker wedge.
30:22
SPEAKER_02: So the second half and the second 12 months um has been kind of like launch and since we've been live.
30:29
SPEAKER_02: So that was May last year.
30:31
SPEAKER_02: So, you know, we're 12 months in now, and in terms of like the progress and attraction, we have over 650 paying firms.
30:37
SPEAKER_02: We have advisors uh actually in seven different countries as well.
30:42
SPEAKER_02: And, you know, some of those countries are small in number, but it's just a proof point of the consumer-led focus.
30:49
SPEAKER_02: And what we've taken care of is we've abstracted away a lot of the complexity to be able to spin up in any country or region in the world and very quickly be highly contextualized.
30:59
SPEAKER_02: So if you think about it, you have, you know, like the country's regulation, you might have your network or you're directly authorized yourself.
31:05
SPEAKER_02: That's another layer, and then you have your firm level, and then you have the advisor level.
31:09
SPEAKER_02: And so we've just kind of collapsed those four or five layers into um what I would describe as a very light localization um layer, which is why we're in the seven countries.
31:20
SPEAKER_02: Yeah.
31:20
SPEAKER_02: Um, so for example, Australia um is another market that we have, you know, a really good amount of traction in.
31:27
SPEAKER_02: And the interesting learning for us on the product front and the perspective is that's actually the high most highly regulated market in the world.
31:35
SPEAKER_02: You know, their equivalent of an annual review letter is called a statement of advice that can run 120 to 150 pages long.
31:42
SPEAKER_02: And so if you think about the report writing tool that we've had to build, like the core of the tool will produce documents in any market in the world contextualized to whatever the end output is supposed to be, for example.
31:53
SPEAKER_02: And so it just holds us to an incredibly high bar whereby, you know, we have competitors and multiple competitors actually, like in every market in the country, uh, in the seven countries that we're we're across.
32:06
SPEAKER_02: And so we are constantly scanning not just like UK and the local market, but we are being held to a bar in the US, in Australia, in South Africa, in Singapore, in New Zealand, um, in Canada, for example.
32:17
SPEAKER_02: And so that's what is really pushing us from like a product experience perspective, because we're not just being evaluated in one market against one competitor, we're being evaluated in seven against 20.
32:28
SPEAKER_02: Uh, and then beyond that, like we have raised$13 million of funding in the past 12 months as well.
32:34
SPEAKER_02: So to kind of go back to your point, like this is a very serious like professional setup and operation.
32:40
SPEAKER_02: The team is 26 people.
32:42
SPEAKER_02: We, you know, are essentially doubling our business every eight to 10 weeks and have done for the past 12 months.
32:48
SPEAKER_02: So to kind of give advisors a sense of like the seriousness and the scale that we're moving, you know, at this for, like, we are putting a tremendous amount of, you know, like time, money and resource into this.
32:59
SPEAKER_02: Um, and we're super excited about like I haven't had this much fun ever.
33:03
SPEAKER_02: And kind of the amount of love and just like, you know, random anecdotes we receive is it's like kind of unhinged.
33:11
SPEAKER_02: Like people come up and just like hug you.
33:13
SPEAKER_02: And like I kind of know their screen name, like I've exchanged messages and things, but until you go to an event, someone just comes up and randomly hugs you and goes, like, you've changed my life.
33:21
SPEAKER_02: Like, you know, my close rate is now 90%, and like I can see like 30% more clients straight off the bat is pretty wild.
33:29
SPEAKER_02: It's really easy to be removed from that when you're sat behind a screen, you know, like on a desk.
33:34
SPEAKER_02: And so I think that's the thing that's continued to surprise me is like the positive impact that we're having, and then what's the thing I care most about?
33:41
SPEAKER_02: What does one advisor say to another advisor when we're not in the room about the product?
33:45
SPEAKER_02: And like we don't always get it right, but we try extremely hard, and that's the perception that I care about the most.
33:50
SPEAKER_01: I think having the hat on as well that you're consumer focused and now advisor focused is is is really, really important.
33:56
SPEAKER_01: To be one or the other, this kind of uh it's not a full circle, is it?
34:00
SPEAKER_01: And I think it uh matters massively.
34:03
SPEAKER_01: And the individual who's delivering the advice or building the advice firm to be able to help as many people as they possibly can and have a positive impact on their life need to be looked after.
34:11
SPEAKER_01: And I can relate to that when like things are taken away from me and simplified, I like it's like a weight off my shoulder.
34:19
SPEAKER_01: Um now what you do with that time is down to you, right?
34:21
SPEAKER_01: You might hire more people, you might grow your business, you might see more clients, but you might spend some more time with your friends or family, or the value of your business might go up.
34:27
SPEAKER_01: So there's so many positive impacts that can actually affect the well-being of you, your staff, and everybody within it, but also the consumer.
34:33
SPEAKER_01: So I'm you know, I'm all for that.
34:34
SPEAKER_01: Just really interested because I'm also in the global space.
34:36
SPEAKER_01: I've done a lot in different jurisdictions.
34:38
SPEAKER_01: Um, I understand the pressure that individual firms are on to be able to deliver advice in different jurisdictions, so there is a lot of pressure.
34:43
SPEAKER_01: Um, but with that also comes exposure, right?
34:45
SPEAKER_01: You start to learn all these different countries are all doing different doing things differently.
34:49
SPEAKER_01: And um, I find that really fascinating, which is why glob a global mindset for me is more interesting than just a hyper hyperlocal in like the UK.
34:56
SPEAKER_01: I would call UK now hyper-local as I start to branch out into America.
35:00
SPEAKER_01: Um what country for you is doing advice the best?
35:04
SPEAKER_01: Who's giving financial planning uh the process, the the service, um, the marketing?
35:10
SPEAKER_01: Who's really nailing it and doing things right?
35:13
SPEAKER_01: Wow, that's a that's a really good question.
35:16
SPEAKER_02: That's a really good question.
35:17
SPEAKER_02: Um I think maybe I'll answer that by giving you kind of like the best things that I've seen maybe across um across a few different markets.
35:26
SPEAKER_02: Um maybe the inverse of that is the the the lesser good things I've seen across markets.
35:32
SPEAKER_02: So um yeah, look I would say like in Australia, for example, the reason they're the most highly regulated in the world is that they had a Royal Banking Commission kind of six or seven years ago, and there were some very shady practices that were essentially um, you know, raised as part of that.
35:47
SPEAKER_02: For example, like banks advising on their own products um with no independence, right?
35:51
SPEAKER_02: And so it just cleaned a huge portion of the market out, essentially.
35:55
SPEAKER_02: And the kind of like compliance burden that now comes with that as a result of that poor behavior over time, like one is justified and fair, but two, it makes it like very hard for new advisors to get into the industry.
36:06
SPEAKER_01: Degree regular, you have but your d degree level now is like four years worth of study, right?
36:10
SPEAKER_02: Yeah, two two years essentially.
36:12
SPEAKER_02: Incl including a year of like full-time traineeship.
36:15
SPEAKER_02: So again, from my perspective, the barrier to enter and to get in and actually become qualified in as advisor is harder there than anywhere else um in the world.
36:25
SPEAKER_02: And then I think on the kind of flip side of things, like, you know, America is the land of the opportunity.
36:32
SPEAKER_02: Um and I would also say that um, you know, the perception of advisors there is probably like the greatest that I've seen anywhere in the world in terms of, you know, there's nothing more than Americans respect than, you know, the American dream, the success story, the fact that, you know, you've worked hard and you've been able to build, you know, wealth off your own back over time as well.
36:51
SPEAKER_02: And so I think like the American mindset is much more like, you know, abundance and opportunity and also like the pathways in there are like a lot, you know, simpler and and straightforward.
37:02
SPEAKER_02: And they have a great track record in history, like over time of like delivering and doing that.
37:06
SPEAKER_02: So if you you were to compare and contrast like Australia and the US, like Australia is like stagnating or going backwards, whereas like US is very much like up and to the right in terms of like trajectory and opportunity and what it means to be a financial advisor there.
37:20
SPEAKER_01: Okay.
37:20
SPEAKER_01: You've learned a lot about the barrier to entry when it comes to actually implementing AI in the business.
37:24
SPEAKER_01: So anybody listening right now and they're thinking about MALU, just again, just reiterate like what's the easiest step to actually starting to use AI within your business?
37:32
SPEAKER_01: Um, the most cost-effective way of doing it, and the less amount of stress and probably fatigue that you might experience.
37:38
SPEAKER_01: What's the the best way to do it with Marlou?
37:39
SPEAKER_01: What's the best way to work with you and the best way to start?
37:42
SPEAKER_02: Yeah.
37:42
SPEAKER_02: So I would say like adoption is the battleground.
37:45
SPEAKER_02: We're very good at procuring software.
37:47
SPEAKER_02: And essentially what that looks like is you pull out your credit card and you say, I'm gonna have this because you've been really excited up front.
37:53
SPEAKER_02: But a lot of AI, you know, product in the financial advice spaces become like the gym membership.
37:59
SPEAKER_02: You go a couple of times in January, once or twice in February, and then kind of usage drops off.
38:03
SPEAKER_02: So the question is why.
38:05
SPEAKER_02: And my advice to um, you know, firms and advisors and paraplanners is you need to start very simply with one thing in mind.
38:13
SPEAKER_02: And, you know, I think a lot of people will sit there and say, everyone's, you know, already done meeting notes or everyone's already doing their reports.
38:21
SPEAKER_02: That's not true.
38:21
SPEAKER_02: We're still so early in the adoption curve.
38:24
SPEAKER_02: There's still a ton of people out there who are using no AI whatsoever.
38:27
SPEAKER_02: So, one, like, don't be discouraged or put off by that, like you're still early.
38:31
SPEAKER_02: And then two, I would start very simply with meeting notes.
38:34
SPEAKER_02: And the best way to like actually nail adoption and roll things out and, you know, um, not run into that gym membership analogy is run a trial.
38:43
SPEAKER_02: Like you need to set a two-week period.
38:46
SPEAKER_02: From what we've experienced, that is the best to kind of like garner adoption.
38:49
SPEAKER_02: And you create a social contract where you say, you know, if you're less than three advisors, then like all three of you would, you know, use the product.
38:56
SPEAKER_02: If it's more than, you know, a three advisor firm, just cap it, you know, the three most interested people and say, we're gonna use this for every client meeting for the next two weeks, and we're gonna do two things.
39:05
SPEAKER_02: We're gonna try and quantify the impact and set a hypothesis, i.e., like, how much time do you think we're gonna save?
39:11
SPEAKER_02: And then we'll prove whether that's true or not.
39:14
SPEAKER_02: And then, you know, probably 50% of it's just anecdotal feedback, like, have I enjoyed using this?
39:18
SPEAKER_02: Has it been simple, intuitive?
39:20
SPEAKER_02: And so if you can do those two things, like you typically will get to the end of the trial and you know, like you've embedded the behavior within the firm because you've had like a concentrated and concerted effort.
39:31
SPEAKER_02: And then if you're larger than just the three advisors who have been trialing, they will typically evangelize and roll out.
39:38
SPEAKER_02: And so, you know, rather than you if you're the firm owner or you know, a leader in that firm having to kind of like pull everyone along, you can use your advisors as evangelists to kind of like push um for you.
39:50
SPEAKER_02: And that's like just again a very different like dynamic and perspective.
39:54
SPEAKER_02: And it's a way to best solve from a behavioral perspective in terms of introducing something new.
40:01
SPEAKER_02: Yep.
40:01
SPEAKER_02: Um, so in terms of the Malu product, it's like anyone can sign up in two minutes, try it out, and or like book a demo, and it's the best way for us to tailor, you know, your onboarding and also support with a trial.
40:12
SPEAKER_02: So typically, if we're trialing with, you know, let's say like a 10 plus advisor firm, like we'll have an onboarding kickoff and a call, we'll have a check-in at the end of week one, we'll have a check-in at the start of week two, and then again at the end of week two.
40:25
SPEAKER_02: And we're just constantly using these touch points to like to get feedback to help break down and remove barriers.
40:29
SPEAKER_02: And then from my perspective, at the end of that, typically you've had a great experience.
40:34
SPEAKER_02: You've kind of joined the dots to lines in a sense of like we've been able to jump in and help solve and like troubleshoot problems as they've come up.
40:40
SPEAKER_02: We've built trust and a relationship, and then you can turn around to those advisors and you know, like I'm most interested again in their feedback at the at the end of that.
40:49
SPEAKER_02: And in terms of like next steps, we use them as the evangelists within the firm.
40:53
SPEAKER_02: So you can run the training sessions, you can teach and help, you know, um, almost like get around the the stigma of AI in a lot of firms, because the thing I'm most interested in nowadays is like I go into a firm and say, like, who's the advisor most likely to hate me here?
41:10
SPEAKER_02: Um, and like you know, hate's a strong word, dislike, but um it's more a matter of like us sitting down and understanding like what are the barriers here?
41:18
SPEAKER_02: How can we break them down?
41:19
SPEAKER_02: And again, if we agree that everyone wants to spend less time writing any review letters and that's true, then like what's the real barrier here?
41:27
SPEAKER_02: No, I love that.
41:28
SPEAKER_02: You mentioned trial, is that free?
41:31
SPEAKER_02: Yeah, correct.
41:31
SPEAKER_02: So we do a 10-meeting free trial.
41:34
SPEAKER_02: And to be perfectly fair, um, we don't even, you know, we don't uh keep the clock on the number of meetings.
41:41
SPEAKER_02: So, you know, if people want a run over or there's been disruption during their trial period, then like we just extend it.
41:47
SPEAKER_02: And like for context, we didn't actually have a paywall on the product until about six months in.
41:51
SPEAKER_02: So I had to ask individually every single firm to convert to paying, and that's the ultimate listen litmus test as to whether like there's value in your product.
41:58
SPEAKER_02: And very quickly, when you ask people that question over email or face-to-face, you surface like any hesitations or issues.
42:05
SPEAKER_02: So back to the consumer principles, it's just like very easy for us to be responsive to that and stay kind of as you know, we aspire to be the most kind of advisor-centric firm like building in this space.
42:17
SPEAKER_02: And if we continue to do that, then like it's very difficult for us to muck it up.
42:21
SPEAKER_00: Yeah.
42:21
SPEAKER_01: I really worry when people tell me they use Claude and they use ChatGPT in their financial planning firms, and they think that's like acceptable uh AI to be used.
42:28
SPEAKER_01: And I worry about data specifically.
42:31
SPEAKER_01: Does that sort of do you come up against that?
42:33
SPEAKER_01: Are you you're finding that people are using Claude, they're using ChatGPT, they're chucking notes in there, you know, this is this is data, isn't it?
42:40
SPEAKER_01: This is this is really confidential stuff.
42:42
SPEAKER_01: And he does that worry you?
42:43
SPEAKER_02: Yeah, it does.
42:44
SPEAKER_02: And so the anecdote that I will give you is any data that you put into an open AI or a Claude gets automatically autolog for 30 days.
42:53
SPEAKER_02: Um, regardless of whether you like it or not, it goes and sits there for 30 days, and you will typically also not have control over where it is stored.
43:00
SPEAKER_02: So it could be the US, for example.
43:02
SPEAKER_02: You don't know.
43:03
SPEAKER_02: And so in our case, because we sat there for those six months and we went to CIOs, CTOs, like outsourced IT providers and said, How would you procure us?
43:12
SPEAKER_02: What are your concerns?
43:12
SPEAKER_02: And this was much earlier on in the AI adoption curve.
43:15
SPEAKER_02: So the um the standard that we felt we had to clear was actually like even more so than to than you know it is today.
43:22
SPEAKER_02: And, you know, how that has um transpired, for example, is we listened, we understood those concerns, and with OpenAI and with Anthropic, we went and signed enterprise agreements.
43:33
SPEAKER_02: So what that enables us to have is zero data retention.
43:36
SPEAKER_02: So there's no storage.
43:37
SPEAKER_02: So basically we can like pass and use their APIs, but there's no audit logging.
43:41
SPEAKER_02: And we have regional API access, which means that we can control where it passes through and where it's stored as a result.
43:48
SPEAKER_02: Um, and so for us, again, to be the most advisor centric firm out there is to listen to all those hesitations, concerns, and problems and go based on everything that we know and your expectations, what is the product experience we can deliver, including the data privacy and security that mirrors and matches that.
44:05
SPEAKER_02: So that's what we've tried to do.
44:06
SPEAKER_02: So in most cases, like I try and use that example as like an education piece.
44:10
SPEAKER_02: Or a lot of people will be stripping out any personally identifiable information, but arguably that takes just as long, if not longer, than I don't think people are doing that.
44:18
SPEAKER_02: Doing a task like manually in the first place.
44:20
SPEAKER_02: So yeah, I would just say like it is a concern and it's where the value of an advice a specific tool comes in because I can explain how we're able to like alleviate that pain point or that problem completely.
44:32
SPEAKER_01: Is there a regulatory and illegal requirement to use um something that is the way you've got an agreement with Anthropic, etc.
44:40
SPEAKER_01: Yeah.
44:40
SPEAKER_01: Is there is there a legal and regulatory requirement for a firm to evidence that they are protecting data when it comes to AI?
44:48
SPEAKER_01: Is that now in place?
44:49
SPEAKER_01: Because it to me it's like the most obvious transition would be if you're using ChatGPT now, you know, if you're if you're using Claude you you need to be going using something like Marlo A to protect your clients, to protect yourself legally and from a regulatory perspective.
45:03
SPEAKER_01: Is that the case?
45:03
SPEAKER_01: Is there something you can quote that actually says these people have to do this?
45:06
SPEAKER_02: Yeah, no, there's not at the moment.
45:08
SPEAKER_02: I would say regulators around the world including the FCI in the UK are definitely pro AI from the perspective of being able to help advisors.
45:16
SPEAKER_02: So for example we submitted recently on some like FCA guidances to the use of AI and advice we've been part of roundtables like that all makes sense.
45:25
SPEAKER_02: The intent there is like good and well but there has been no specific you know guidance issued beyond that.
45:31
SPEAKER_02: Like the expectation or the prediction that I'll have is that they will come out in the not too distant future and make a recommendation that advisors should be using some form of advice specific tool for example or you know you will default you know transcribe client meetings, whatever it might be.
45:48
SPEAKER_02: I think like very much that should be in the kind of like domain of like concern and also I think it's also just an awareness problem because I'll just go back and say like people who are using those tools like are doing it from good intent.
45:59
SPEAKER_02: And it's also like an education piece and that's our role to be able to like help people like do this in the way that like is best aligned for like you, your firm and your clients.
46:09
SPEAKER_01: One more question around technology which now seems quite antiquated which is like CRMs which are CRMs within financial planning as you alluded to earlier they're not the best they're quite clunky creates time consuming processes.
46:23
SPEAKER_01: What's happening to the CRM is it gonna is it going to go or is it going to be replaced by AI?
46:27
SPEAKER_01: What's your vision of that and are you involved in that?
46:29
SPEAKER_02: Yeah it's a good question.
46:30
SPEAKER_02: Like we have advisors right now who are using Marlo as a CRM so one thing I didn't touch on is you know every client interaction that you have gets stored essentially.
46:40
SPEAKER_02: And so what that means is you can build like a bank in a history over time against a client and it's not just a client it's you know an individual it's a household it's a business it's a trust.
46:48
SPEAKER_02: So we have the kind of like multi-entity capability here as well and you aggregate that as a context window.
46:55
SPEAKER_02: So you have any phone calls, any emails, any meetings, any documents you have you know access to like historical client records, for example.
47:04
SPEAKER_02: And so um I wouldn't necessarily say like it's a MALU or a CRM equation.
47:10
SPEAKER_02: My view on the CRMs is that you know typically they are compliance records.
47:15
SPEAKER_02: They're where data goes to be stored and that's fine like that has its role.
47:18
SPEAKER_02: MALLU is a place where work gets done.
47:20
SPEAKER_02: So if you think across that entire advice stack, like what has to happen before you meet the client all the way through to you know like final report like delivered and prepared which typically you know is the dependency for implementing a strategy, charging, et cetera if you think about everything that happens in between, like MALU is a place where that work gets done across a firm.
47:41
SPEAKER_02: And so I think it's just like fundamentally a different proposition to a CRM.
47:45
SPEAKER_02: And so it's not necessarily a uh you know is it one or the other?
47:50
SPEAKER_02: It's like you can have both, but it should be very clear to an advisor over time if we continue to deliver, you know, on um you know the product promises that that we're essentially making that um Marlo is the place that work gets done and it's where you get the most leverage on your time as an advisor and as a firm.
48:06
SPEAKER_01: I love it.
48:07
SPEAKER_01: But Hardy, thank you so much for coming today to talk about Mali.
48:10
SPEAKER_01: It sounds like a fantastic AI product.
48:12
SPEAKER_01: And with the consumer at the heart of it as well as the advisor and the psychology and the behavioral change for getting people to use this, I also admire the you know the the barrier to entry by giving free trials, I think that's just super important and getting people to use it, feel comfortable with it, you know, and starting with one thing before you try and take on the world.
48:30
SPEAKER_01: I love the the evangelical side of it as well.
48:32
SPEAKER_01: So when you get somebody in the business that might be the biggest oh no we don't want that and then you change their perception of it and then they become the person who can you know delivers the training and shows it I think it's super super super important.
48:42
SPEAKER_01: And the deep research that you've done, you know, the go the go slow to go faster methodology is fantastic.
48:48
SPEAKER_01: Not just you know in the UK you've gone global.
48:51
SPEAKER_01: So look one of those products that I I guess you've just got to start isn't it and when people are on the fence and they're thinking about AI this just seems like the s the the the safest option to get going.
49:02
SPEAKER_01: And um if anybody's listening right now and you want to get going you can because they reach out to you directly can't they can go to the notes section there will be a QR code that will pop up as well that will take you to strictly through to a demo and a free trial so get AI and I say fantastic.
49:16
SPEAKER_01: We're happy to help fantastic thanks