Endowus CEO Gregory Van Doesn’t Care About Earning Fast Money
The co-founder of Endowus, a Singapore-based wealth-tech company, shares that he doesn’t let himself get distracted by market trends or setbacks
When you have already charted a stellar career in investment banking at UBS and snagged a spot at Grab as part of the pioneering team that launched the firm’s digital payments services across Southeast Asia, jumping ship to establish your own start-up could be quite the risk.
“I was at an exciting place in a very exciting time managing six countries; it was a broad role with a lot of opportunities, so leaving Grab to start Endowus was a risk,” says Gregory Van, recollecting the year his life trajectory changed dramatically when he became an entrepreneur for the first time.
In 2017, Van co-founded Endowus with Samuel Rhee, ex-chief executive officer and chief investment officer at Morgan Stanley Investment Management in Asia. The former is now CEO of Endowus, which is licensed and regulated by the Monetary Authority of Singapore, while the latter heads the investment office as chairman and chief investment officer.
The duo is on a mission to make investing accessible and at the lowest achievable cost for investors via a new platform accompanied by a new business model never before seen in the local financial markets. “Our motto is to help people invest—not speculate—so they can live easier today and better tomorrow,” says Van.
“We focus on holistic wealth management and provide strategies to people that can meet their investment objectives. We put together portfolios of strategies that suit your individual life goals and you can run all of those portfolios on Endowus at levels of cost and automation that have never existed before. This is [how we think the future of wealth management should be].”
Endowus partners with UOB Kay Hian and HSBC to provide clients with access to the expertise of best-in-class institutional fund managers. The Singapore-based platform offers a fee-only service, whereby clients are charged an all-in fee of 0.05 percent to 0.6 percent (per annum) of the value of assets held with Endowus. According to the company, this works out to less than half the industry average. The platform also does not charge any transaction fees.
“We’re not a transaction-based business,” says Van. “We make no money on transactions. In fact, we lose money whenever our clients transact—it’s a cost, but we don’t charge them that cost because we don’t want to be incentivised to make them trade.”
The key differentiating factor in Endowus’s offering is therefore the promise of transparency. Unlike how investment products are traditionally sold in the market, Endowus does not receive hidden sales fees from product providers, which would otherwise incentivise them to push high-commission investment products to clients.
“We wanted to flip this entire equation on its head and be strictly what we call a fee-only platform. And if we’re paid by anybody else (besides the client), we give back 100 percent to our clients—we call it 100 percent cashback on trailer fees—and we’re the only ones in the market that do it,” shares Van.
According to him, this fee-only model, led by an “uprising” of independent wealth managers and financial advisors, has become the “gold standard” in other major financial markets such as the US and Switzerland. He believes this creates a more resilient business model.
In 2020, Endowus became the first digital advisor for the Central Provident Fund (CPF), effectively allowing Singaporeans to invest all their CPF and Supplementary Retirement Scheme funds via the platform.
Last year, the company secured investments from some of the biggest conglomerates in Singapore and abroad, including SoftBank, Singtel, Samsung and UBS. It also attracted investments from EDBI, the investment arm of Singapore’s Economic Development Board. In mid-2022, Endowus crossed S$2 billion in client assets.
By the end of the year, the Hong Kong platform will be launched.
“We want to build a sustainable business model. We’re not going for the quick win, fast money,” explains Van.
“Everything about our business model, our products and services, and the advice we deliver to our clients are meant to be resilient through market downturns. It’s not ‘flavour of the month’ stuff. Being stubborn in our strategy and not being distracted by everything else that’s going on [brought] Endowus to where it is today.
“I’m someone who isn’t fazed by what’s hot in the market or by small setbacks because we’re looking at a 10-, 20-, 30-year vision. As a result of that, Endowus has chartered on a course in a very differentiated way from all the other digital wealth and investment platforms.”