SigFig Rolls Out a Smarter Piggy Bank to Help People Invest More Wisely

San Francisco-based SigFig is rolling out a new type of investment service that makes managing investment portfolios way easier.

Users enter their 401(k), IRA, brokerage and adviser account information on the site, which then pulls together all of the investments into a single dashboard. From there, it can identify high brokerage fees, bad investments, hidden fees or overly expensive advisers.

“Merrill Lynch, Morgan Stanley and other wire-house firms are a real rip-off,” said SigFig’s co-founder Parker Conrad. “Their product is poor and expensive … The wire-house firms are going to hate us. We are hoping to irretrievably break their business model. That’s our goal. If they are shutting down their wealth management programs, then we’ve succeeded.”

While those are lofty ambitions, today marks the first day of its invitation-only service. (AllThingsD readers can click here to gain access.)

Based on results from a closed beta, the company is hopeful it can make a big impact quickly.

It says it is finding that one in five people with an adviser had below-average performance and above-average fees, and that an average user on the site can save $5,000; up to $8,000 if they trade frequently.

“Literally, we have one user who could buy a new Ferrari every year just based on trades,” Conrad said.

SigFig originally started out as Wikinvest, which allowed users to track their financial portfolios. A little over a year ago, the company began to build SigFig, and has been operating in an alpha with 5,000 members. Over the next few weeks, it will let in another 500,000 users.

SigFig is part of a growing trend in Silicon Valley, where technology veterans are trying to make investing easier using the Internet.

Co-founder Mike Sha said that through its members, SigFig has access to $30 billion of assets from 65 financial institutions. The company uses that data — in aggregate — to identify what brokerages are selling and how much they are charging. In that way, the investment service uses a sort of crowdsourcing to find the best answers.

He said one of the most common ways to save money is to identify a mutual fund with a different brokerage that has lower fees.

“People are shockingly neglectful on how they manage their money,” Sha said.

SigFig is free to use, and makes money off of commissions, but oftentimes it isn’t paid at all, if the best recommendation doesn’t have a commission. The company, which has nearly 40 employees, has raised $8 million in capital from DCM and angels, including Jason Krikorian of Slingbox and Mark Britto of Boku.


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Another gadget you don’t really need. Will not work once you get it home. New model out in 4 weeks. Battery life is too short to be of any use.

— From the fact sheet for a fake product entitled Useless Plasticbox 1.2 (an actual empty plastic box) placed in L.A.-area Best Buy stores by an artist called Plastic Jesus