Throughout more than a decade working in financial services, Peter Hans noticed a pattern in his meetings: Investment professionals would gather and inevitably talk about their favorite stocks and investments.
"Everyone was willing to share ideas, but that information was never publicly available," he says. "After years of this, I thought there had to be a way to create something where the information is more democratized and scalable, and flows freely between people who have access to information and people who don't."
With that aim, Hans, along with Andrew Parmentier and Mike Perrone, created Harvest Exchange, a free website where money managers and financial insiders can share their thoughts and opinions about investments.
Although Hans says Harvest isn't a social network, it provides a Facebook-esque feed of thoughts from investment professionals curated to showcase posts from top investors — but with the legally necessary compliance review to accompany posts on specific stocks or investments.
It also offers a million-dollar virtual hedge fund that Hans says is used by everyone from smaller asset managers looking to prove their expertise to students who want to build a virtual investing "resume" before hunting for a finance job.
Business Insider's Julia La Roche profiled the site and its high-profile users in early 2014.
But while the bulk of Harvest's 60,000-plus users are industry insiders like Dan Loeb and Sahm Adrangi, the site intends to break down the wall between financial professionals, clients, and would-be clients. As much as Harvest provides a platform for professionals to share their thoughts, it also provides amateur investors with a direct line to expert insight, without the price tag.
"There's pretty significant mistrust between the everyday retail investor who's trying to figure it out, and professionals," Hans explains. "We give the more experienced investor the ability to, in a really easy way, discover the products, services, and financial experts that are right for them, instead of being bombarded with cold calls or emails or banner ads. You can curate the info based on what interests you."
Hans thinks the rise in automated investing platforms known as robo-advisers is a result of the average person's dissatisfaction with the financial industry's current system, and the costs that go with it.
"One reason you're seeing robo-advisers and different alternatives for consumers is that management fees are high across the industry, and there's a questionable value proposition when there's a lack of communication," he says. "With all the innovations in technology, the means of targeting and acquiring customers hasn't changed in 50 years, and the only way to offset those costs is higher fees."
To combat those fees, Hans explains, you can either create new technology like robo-advisers, or give existing advisers a way to be more accessible at less cost to them, where they can either prove they're worth the high fees or eliminate those fees while communicating with clients and potential clients in a cost-effective way.
"There's a lot of illnesses and problems in the system," he continues, "and you can offer new products or services that directly compete with the existing infrastructure because the existing infrastructure is sick [like robo-advisers], or you can cure the illness."
Because Harvest's professionals may tout specific stocks and investments rather than the broad, more conservative investment approach usually recommended for beginners, Harvest probably isn't the go-to option for an investor just dipping their toe into the market. Hans admits that not only would some of the site's content be over the head of the beginning investor, but that a lot of the information can even feel advanced for him.
If you're looking into working with an investment professional or firm, however, Harvest is another way to learn more about the people you plan to trust with your money.
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