Finary Is The Social Investing Platform For Gen-Zers And Millennials

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Compared to Baby Boomers, Millennials lack the same share of total national wealth in the U.S. as the former did when they were the latter’s age. Thus, a lack of disposable income makes it hard for Millennials to invest in the stock market and grow their net worth passively. For those who are fortunate to be able to start investing, they usually don’t know where to get high-quality, reliable information from unbiased third-parties. Instead, they end up relying on their friends and family on investment advice. Darian Bhathena, Jack Phifer, Michael Liu and Roger Cawdette all faced this same issue and built Finary to meet their investing needs. Finary is a group chat-based social network focused on investing – think Discord for the casual investor. The MIT- (Phifer and Bhathena) and Harvard-trained (Liu and Cawdette) entrepreneurs have based their startup out of Cambridge.

Frederick Daso: What drives the absence of transparent, accessible investment tools for consumers?

Roger Cawdette: In the last decade, many fintech companies have entered the market to promise democratizing investments. Robinhood made it easy to execute trades, Public popularized fractional shares, and Acorns gave us a way to contribute to our savings effortlessly. As big of a fan as we are of these products, our Finary team believes that the resources needed to become a good investor go far beyond cost and simplicity.

Let’s make a quick comparison of average retail investors and hedge fund managers on Wall Street. The latter has access to the latest market news and data through the Bloomberg Terminal, research analysts, and a network of connections with exclusive insights. On the other hand, regular investors are left to fend for themselves and are often faced with the challenge of making their investment decisions alone. Understanding this, we think that the promise of making investments accessible should now be one of providing people with a strong community of investors and providing that community with sufficient market data, news, and research. The good news here is that all of these resources exist in some form on the Internet. Still, the issue is that they’re scattered and relatively challenging to find, especially for the average consumer who might be limited by time, money, and expertise. With Finary, our mission is to build a digital community for investors where everyone has true access to all of these resources.

Daso: When you, your friends, and family members were learning the basics of investing, how did you manage to find high-quality information in a sea of noise surrounding the U.S. stock market?

Cawdette: I first started investing in the stock market as soon as I got to college. I was eighteen, had a little bit of graduation money, and was overly eager to grow my portfolio quickly. More importantly, I had zero interest in reading investing books, so my learning process consisted mainly of trial and error with actual money. After losing a fair share of my portfolio on a couple of reckless options trades and coming to my senses, I eventually turned to my friends, who were similarly beginning to invest at the time, and the effects were immediate. Having a group of trusted confidantes to consult on trades, split research duties with, and make decisions alongside, I found myself thinking far more critically about my investments than before. 


My experience isn’t novel. During months of user research, we found that an overwhelming majority of young investors similarly had opted to learn the basics of investing through friends and family — both being social mediums. Ultimately, these experiences and observations provided the initial inspiration for Finary, the idea that young people could benefit substantially from merely having their friends to invest alongside.

Daso: With more Millennials and Gen Z taking the plunge into the stock market, how are current investment tools failing to meet their specific needs?

Cawdette: The reality here is that today’s investment tools are optimized for simplicity. Unfortunately, financial markets are anything but simple in that they require significant amounts of research, critical thinking, and planning. As I mentioned earlier, young investors are searching for tools that do more than giving us the ability to execute trades. We’re searching for community, thoughtful quality opinions, and fun ways to learn the basic investing principles. However, with our attention spans getting shorter and shorter, the thought of sitting down to read through articles on Investopedia or take an investing course seems pretty unrealistic. So the challenge here for our team has been to design engaging new systems around which young people can learn about investing, discover insights, and interact with others.

Daso: What are the most common resources that this particular demographic uses to make their investment decisions?

Cawdette: It’s been fascinating to see the creative ways my generation – Gen Z – has gone about making investment decisions. While most of our parents have built habits around watching Jim Cramer and the rest of the lineup on CNBC, young people have turned to financial communities on Discord, Youtube, and even Tik Tok. Creators like Austin Hankwitz have developed a considerable following by making investment news and education more digestible by using bite-sized clips. And Reddit forums like the popular r/wallstreetbets have provided average investors with a wealth of opinions on the latest trending stocks and market events. Although investing has only recently made its way into the mainstream of American pop culture, it’s clear that young investors have already gotten to work on building the future of the space.

Daso: Why did you and your team at Finary decide on group message chats as the medium for users to interact with one another about investing?

Cawdette: Today’s great social platforms are designed around openness and virality; however, this isn’t exactly fitting for interacting around investments. As we’ve learned in the last few weeks, building virality into the stock market can lead to unprecedented surges and have incredibly destructive impacts on investors, big and small. The great thing about group chats is that they allow you to carefully choose who you want to interact with and what you want to share with them. In developing such a walled garden environment, these smaller communities can better create a sense of comfort, transparency, and trust, all of which are essential ingredients for fostering discussions around investments. In addition to all of this, another key reason was that this is what young investors are already doing. Like I mentioned earlier, they’re using platforms like Discord, GroupMe, and even plain old text messages to talk about their investments with their friends. With Finary, we’re taking this existing behavior and building the platform that’ll make the experience 10x better.

Daso: What are the specific steps you’ve taken to make Finary user-friendly and have an aesthetically and authentic user experience for Millennials and Gen Z’s who are hyper-sensitive to such factors?

Cawdette: One of the benefits of being a particularly young founding team and power users of our product is that we’re designing for ourselves. We recognize the desire for personalization, the importance of privacy, and the fact that intuitive and delightful design is a pre-requisite of today’s consumer products. But going beyond that, as builders, we also recognize that it’s crucial to talk to users to make something they want. This is probably the biggest learning we’ve received at YC. Analyzing metrics is great, but engaging in constant conversations with the individuals on our platform is the real driving force behind our product development process.

Daso: How do you and your team embody your belief that “investing is becoming more social?”

Cawdette: It’s rare that anyone on our team ever makes an investment decision alone. Just last week in the office, we spent ten minutes collectively staring at the Gamestop stock chart while deciding on the optimal time to all buy in — so clearly, we take social investing seriously, maybe a little too much. As a team, we not only believe that investing alongside others makes you a better investor, we are also convinced that doing so makes the actual investing more fun. As I mentioned earlier, it’s been interesting to watch vibrant investing communities sprout up all over the Internet. Just this past week, I was listening in on a conversation about the stock market on Clubhouse. I was so delighted to witness as an older man from Istanbul bonded with a young kid from California over Dogecoin. If there’s anything that we can take away from this experience, as well as the recent Reddit episode, it’s that ‘investing-as-a-social-activity’ has finally entered the mainstream. We’re no longer in an era where talking about your investments is discouraged. We now live in a world where people profoundly desire to interact with others that it’s the very opposite. At Finary, we feel so excited and incredibly fortunate to be building the digital community for the future of investing.