Vise, a startup using artificial intelligence to build and manage investment portfolios for RIAs, has hired a computer scientist to lead its investment strategy, a researcher who’s previously worked at asset managers familiar to many financial advisors.
Dave Twardowski joined the company this month as a vice president and the head of Investment Strategy, he told RIA Intel. He previously worked at American Century Investments’ Avantis Investors, an asset manager formed by a group of employees who splintered out of Dimensional Fund Advisors. Before joining Avantis, Twardowski also spent eight years working at DFA, one of the world’s largest asset managers with $601 billion and beloved by advisors.
He has a doctorate in engineering sciences from Dartmouth College and developed software to emulate the dynamics of jet engines, and flight control algorithms, before pursuing finance. For the asset managers, Twardowski spent time researching trading, algorithmic strategies, and building portfolios for clients.
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As he became more involved in separately managed accounts at Avantis, Twardowski said demand for customized portfolios was apparent and growing. It occurred to him that technology could scale the work he was doing on SMAs, making that type of portfolio construction more accessible. But at the time, he was unaware of a company doing that.
“What you really need is a world class technology company and a company that is very well rounded in financial science. You really need that blend and I didn’t really see that blend. I thought there was a better way to do that than what is on the market now,” Twardowski said.
He soon discovered Vise was working on exactly what he envisioned, so he reached out about joining the company.
At Vise, Twardowski will help develop and refine the firm’s investment strategy or philosophy, which is similar to the ones behind Dimensional Fund Advisors and Avantis. “I kind of think of it as financial science informed by data science and that’s the way that I’m approaching our investment philosophy here,” he said about Vise.
Vise, co-founded by two artificial intelligence whizzes, has raised $60 million in funding (including a $45 million Series B round in December, the second led by the storied venture capital firm Sequoia Capital). For a monthly platform fee of $1,000 and a fee of 0.50% on the assets it manages for advisors, Vise says it can help them build custom portfolios for their clients using individual stocks, a practice often called direct indexing.
Some asset managers have doubted direct indexing and called it “overhyped.” But Vise and others believe there is a meaningful future for customizable portfolios that allow advisors to pick and choose stocks to boost returns, lower taxes, or alter an allocation based on a client’s liking. Vise supports other security types, too.
“I really think market-wise, this will be a success,” Twardowski said. Commingled funds and other solutions have a place but “there is still huge demand for customization,” he said.
Vise will do more for advisors than just help them build portfolios then manage those investments. It is setting out to simplify the entire advisor technology stack and Twardowski said that will happen with the leadership in place.
“I was incredibly impressed” with the Vise co-founders, Samir Vasavada and Runik Mehrotra, Twardowski said.
Along with Twardowski, Vise has hired several employees with impressive work experience and added two former commissioners of the Securities and Exchange Commission to its board. Alumni from BlackRock, Affirm, Google, and Dropbox have joined the company, which grew from six to 50 employees in 2020 and plans to have 100 employees before July.
Vise, founded in 2019, managed $10.7 million as of Oct. 5 last year, according to regulatory filings.
Michael Thrasher (@Mike_Thrasher) is a reporter at RIA Intel based in New York City.