Does investment management need disintermediation?

The answer is yes.

In TL;DR style, there are two problems: information and incentives.

Information problem

Firstly, there are too many financial investment products. Greater choice does not empower investors, it confuses and disempowers them.

If the industry was truly focused on performance and transparency, then there would be far fewer products, of significantly greater quality. Inferior products would disappear.

Incentives problem

Instead, we have an industry centered around marketing and distribution. It uses complexity and opacity to maximize fee extraction. In other words, there is poor alignment of incentives with investors.

The solution

The answer is to use technology to disintermediate much of the investment management industry thereby solving the information and incentive problems.

In broad strokes, this involves the introduction of platforms that connect investors (sources of capital) and products (uses of capital) while also necessarily providing the analytics to illuminate product quality.

Are you…