How Trio Democratizes Investment Access and Financial Empowerment for Millennials

Choosing what to invest in is like choosing what to order from the Cheesecake Factory menu. The overwhelming selection means people end up choosing what is most familiar to them. When it comes to investing, it’s no different: what is most familiar to people is leaving their money in the bank. In fact, a recent Ignites survey found that some of the top reasons Millennials don’t invest are due to lack of financial knowledge, and inertia (when in doubt, do nothing).

This resonated with Neel Ganu (MIT Sloan ‘18), who spent his career consulting in financial services and is a Chartered Financial Analyst. Neel always knew that he could do better with his money, but he didn’t, and much to his bank’s delight he kept his money in cash. Neel is not alone in this: a staggering 60% of millennials do not invest at all. Consequently, this group has missed out on returns from stock market growth which older generations have enjoyed.

Upon realizing the massive missed investment income among millennials, Neel explored why people don’t invest by speaking to his classmates. He found that for most Millennials, it is a luxury to put money aside to invest. Existing financial responsibilities, such as the high cost of living, student debt, and other debt mean that 62% of Millennials are living paycheck to paycheck. A focus on surviving month to month gives people very little financial flexibility to think about investing or other financial opportunities.

Determined to help fix this problem and empower future generations financially, Neel founded Trio, an all-in-one brokerage and checking account that provides instant liquidity to help Millennials invest with ease. Trio offers three, simple investment options, exchange-traded funds (ETFs) which are large, diversified, low cost, and commission free. To help people make better decisions, Trio recommends how to invest based on each person’s unique risk profile, income, and expenses. Returns update in real time and the most significant benefit is that ability to spend the balance instantly via debit card. With Trio, users can spend while investing.

Trio aims to fix the friction in the financial system today that prevents people from investing. Neel’s thesis is that the financial system as a whole has been built on separating spending and investing (since the first bank 547 years ago!). Driving liquidity has traditionally been challenging; however, recent technological developments have made this easier. Nonetheless, it is still not simple enough. Today, it takes between two to ten days to move money between your spending and investment accounts. Banks and financial institutions are designed to keep these buckets separate in order to profit. Banks take deposits from customers, invest deposits in mortgages, earn interest, keep most of it, and pay back very little interest to customers while managing liquidity.

Trio works by taking deposits from customers, investing it for them, and paying back returns while managing liquidity. Trio flips the way in which financial services institutions work to prioritize customers.

The benefits of investing can be significant. Over the past ten years, keeping your money in a moderate risk portfolio (rather than a savings account) would generate over 50% more wealth. Trio makes these benefits available to all its customers.

Neel was the first US employee of N26, a European challenger bank start-up that offers a digital banking experience via mobile (who now are present in 17 countries with 4M customers after raising $513M). Having a background in computer science and finance with industry specialization in retail banking, Neel is leveraging his experience to help solve the problem of millennial underinvestment. He is joined by an experienced product team (who built core products at PayPal and Amazon) and development team (who built the first version of Acorns).

So far, the Trio team has built their mobile application and core banking system, has agreements in place for banking and broker licenses, and has established the regulatory framework under which Trio can operate. After graduating from MIT Sloan, Neel and his team will relocate the company to New York, with the goal of launching the app in early 2020.

We’re thrilled to have Trio in the Rough Draft family and excited to support them as they work to make investing simple and accessible for all. If you want to find a simpler way to invest, sign up for early access at www.trioapp.com.