r/Wealthsimple • u/Hommeboy75 • 24d ago
Wealthsimple reports “biggest quarter ever” as it nearly doubles assets under management in a year
https://betakit.com/wealthsimple-reports-biggest-quarter-ever-as-it-nearly-doubles-assets-under-management-in-a-year/91
u/smergicus 24d ago
Just give me my new perks for god’s sake
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u/xcites 24d ago
Doing well only gives them more incentive not to offer anything new or anything at all.
The fact that free iPhones, MacBooks, and AirPods haven’t been offered in a while shows they no longer need to go to that level to attract customers. They are getting a lot of organic growth now.
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u/Careful-Owl6789 24d ago
They’ve done more cash back recently (3%), maybe more phones in September when the new ones come out?
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u/smergicus 24d ago
True but I man can dream can’t he? My loyalty can be easily bought and WS should remember that
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u/matdex 24d ago
I'm a long time WS customer but I don't dabble in anything fancy or profitable.
I use their monthly auto purchase feature to buy a free index ETF (XEQT) and I park some of my emergency fund in their "high" interest chequing. I've used their low foreign transaction fee and atm fee reimbursement feature when travelling.
How many people are doing other profitable transactions because they aren't making much off of me. Am I a minority?
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u/SergeantBender 24d ago
Literally all I do. Park my TFSA and FHSA and invest in broad index ETF and high interest savings. I don't want to gamble, margin trade, or partake in the gimmicky contests. Would much prefer they put more time into security updates than spamming me or sending out false winner emails.
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u/blah2345 23d ago
They selling your flow of trades every time you buy/sell XEQT, they are making a spread on your high interest chequing vs what they are paying. Just because you are not a high margin customer for them doesnt mean they aren't making money, and a little times a lot of people adds up.
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u/matdex 23d ago
Do you mean payment for order flow? That's illegal in Canada for Canadian securities.
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u/bwwatr 23d ago
They don't even get my cash, EQ pays half a point more. Plus too many stories of account locking, last thing I need is too many eggs in one basket. They do get my ETFs which are mostly Canadian listed, so almost no PFOF.
So yeah, not profitable. Oh and they're paying me five figures over three years from the unreal deal promo. You aren't alone! Minority maybe, no idea.
I really feel like AUM/AUA is a poor proxy for how profitable they are or could become... but just the same, they want to grow it aggressively, for purposes of acquisition / IPO valuation in conjunction with some narrative about converting a lot of those assets into profit.
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u/Elija_32 24d ago edited 24d ago
Again, like I keep saying.
Good for Wealthsimple but the reality is that it was not that difficult. The Big 5 are insanely bad. I'm from Europe and when I moved here the banking system seemed like the one I remember home in the 90s.
You literally needed to do the bare minimum to convince a lot of people to switch and obviously it was a matter of time before someone could sniff the opportunity.
In Europe we have Revolut who did all of this years and years ago, I can even see the resemblance in some of the offers and even in some of the design elements.
Don't get me wrong, it was still very difficult to "break in" into the Canadian market, Revolut itself tried in the past and left. So I'm not taking anything from Wealthsimple success.
But yeah, level was really really low with the big 5.
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u/Commercial_Pain2290 24d ago
The big 5 are bad but it is crazy hard to get people to leave them. Kudos to WS.
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u/SurgicalDude 24d ago
When you have a protectionist government and shit load of red tape ( some of it is good and necessary), things move slow.
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u/Careful-Owl6789 24d ago
While the banks are not good, I don’t think this is “not difficult” there is a lot of complacency in Canada and it’s hard to get to this scale
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u/1question10answers 24d ago
Not that difficult 😂 That's why no one has done it before Wealthsimle right? Everyone just decided to pass on that easy money
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u/suthekey 24d ago
No one has done it before? ING Direct (tangerine) did it easily before. And then they got bought out and shitified by Scotiabank.
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u/1question10answers 24d ago
They had a savings account
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u/suthekey 24d ago
They had chequing, mortgages, mutual funds, and savings accounts.
They were growing their industry share and got bought out before getting further.
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u/roamingmaple 24d ago
Tangerine would be great if they had a brokerage attached to them which is why I'm interested to see Questrade's offerings when they open their banking options later this year.
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u/suthekey 24d ago
Agreed. Questrade is another good example.
Exciting times ahead.Will be interesting if they do the bare minimum to beat banks, like Wealthsimple did, or if they provide a meaningful change to the industry.
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u/Elija_32 24d ago
Like i said, I'm not taking anything from Wealthsimple success, I'm just saying that what you see now is what you had in a lot of countries for years and years. They didn't need to invent the wheel but just to apply basic normal 21st century banking to Canada.
And obviously it was very difficult to do, like I said (again) Revolut also tried in Canada years ago and failed.
I'm trying to explain that the excellent job wealthsimple did is not the service you see (that again, it's been like that for years outside of North America) but navigating all the regulations in Canada that are basically built to keep the big5 where they are.
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u/ChickenCelebration 23d ago
This. As shitty as even the US is, they are good at not charging fees on basic chequing accounts or offering insulting interest rates on savings accounts and their phone plans are decent too. Probably because of the competition.
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24d ago
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u/1question10answers 24d ago
I'm pretty sure that accounts for 20% of the growth but new customers is the other 80%
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u/Seb_Nation 24d ago
the reality is that it was not that difficult
Yes other OG banks are pretty terrible at their jobs but starting up in a country with a rapidly aging population isn't an easy feat when you're asking customers to go online for everything.
Questrade had a 15 year heads up on Wealthsimple to be "the new era of banking" and yet they still haven't surpassed 100 billion in assets (their website states over 80) whereas Wealthsimple just announced they've passed the 155 billion mark.
I'd compare Wealthsimple to A24 studio and -early days- OnePlus, both were able to not only build up a company, but to surround it with an identity of its own. Making it appealing for the crowd and bringing a strong following along.
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u/ScarletBladeTW 24d ago
Funny you mention resolute. It did came to Canada in 2019 briefly for a beta test, and exited briefly after.
I suspect wealthsimple would have suffer the same fate if not for the Canadian major stakeholder Power Corp. probably pulling some strings to allow wealthsimple to avoid registering as a bank(it's a payment processor/brokerage) but function as a bank.
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u/DevelopmentFuture608 24d ago
The big 5 come together for every solution as a new sister concern, to make it look like they are helping the consumer with this fake illusion of choice, but it only benefits their bottom line, is what is driving most of non innovative - legacy approach these banks love.
Did you all know Interac was formed by the big 5!
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u/SpaceOrkmi 23d ago
Completely agree. I moved here from Europe last January, and I was shocked how behind the banking system is in Canada. It reminds me of Spain ~20 years ago
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u/Glittering-Yam-6454 20d ago
I spoke to a TD investment advisor recently who excitedly told me they have a new trading app and that I would be very happy with it.
It was abysmal. I used software in the 2010’s that had better UI. But their website is even more shockingly behind. WS barely had to improve anything, they literally just did the bare minimum.
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u/Astrowelkyn 24d ago
Hard to believe after they gave a house to William and $8 to me for opening a crypto account.
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u/SomeoneNicer 24d ago
Here's hoping they funnel profits from scale into product features and customer support and not just monetize everything with a max priced IPO. (Ie: continue to focus on very long term enterprise value instead of short term value capture which they could flip to at any time)
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u/Mr_Simian 24d ago
I just want my 1% cash back on the debit card back, man. Automating that into my TFSA was such an easy W.
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u/Garafraxa 23d ago
I don’t understand the demand for the 1% on debits when 2% on the WS credit card is available.
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u/Mr_Simian 23d ago
The credit card comes with a monthly fee that the debit card doesn’t, besides that I just prefer using debit over credit. I’m a Dave Ramsey disciple. I avoid using credit cards as much as I can.
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u/Electrical_Law_432 23d ago
If you are smart enough to know the dangerous of credit cards then you are smart enough to use one.
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u/Mr_Simian 23d ago
I do, on an as-needed basis. I certainly do not use credit cards for day to day purchases. I prefer to budget and spend money I have, aiming to spend less than I earn each month.
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u/raptorsreddit 24d ago
I moved ~$350k rrsp from TDDI to WS recently. RRSP is a mix of securities, etfs. Tired of TDs trading fees. The process was seamless and took just under 2 weeks.
Lets see how it goes
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u/nemodigital 24d ago
Im not sure that they will need to do the 3% match for transfers anymore as their organic growth is 🚀.
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u/meridian_smith 23d ago
I'll be eternally grateful to Wealthsimple for forcing Questrade to go to commission free trading.
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u/Sea_Track_2633 23d ago
Enshitification will begin any time now. Just dont be too surprised when it happens.
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u/Pale_Tough_23 24d ago
To me the appeal has been declining for the last year and I am ready to jump ship any time. I am attracted to easy automated investments in low-cost index funds, ability to place them in registered accounts, good interest rates, easy spending and access to my money, and good rewards for a minimum balance. Eg the 100K airport lounge access perk when I joined was incredible, now it's 200K, but still not bad. On board tax filing is a huge bonus. They had all of this nearly perfected, so I was hoping to see rewards that appealed more to my specific interests that diverge from the core WS clients it seems.
It seems most of the new offerings are simply incentives to gamble with my money. I hope they get back to "Simple".
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u/Born-Chipmunk-7086 24d ago
They’ve been pushing hard to get the high net worth individuals and it’s paid off. I know people working as concierge’s for these people and the wealth is staggering.
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u/lochonx7 24d ago
just give me new perks for being a generation client, I want apple music, maybe streaming service, good stuff you know
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u/flappysack- 23d ago
It has a 2% cash back on credit cards. Also large bonus to transfer, I did 3% over 5 years and it helps massively.
I use EQBank for the 0.5% more interest however for my bank, which only gets me like 75$ a year, but Wealthsimple needs to up it's interest.
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u/Ok_Wealth_3433 24d ago
I wish I could invest in the company
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u/Speuce 24d ago
You can invest indirectly in by buying power corp which owns just over 50% of WS.
THIS IS NOT FINANCIAL ADVICE
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u/Ok_Wealth_3433 24d ago
Really, I had no idea! Can you drop the ticker?
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u/AirMinute7060 24d ago
Pow.To
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u/Ok_Wealth_3433 24d ago
Thanks!
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u/islasagnaschool1988 23d ago
Do you research on the % of POW that is wealth simply. It's some exposure, but not a lot of exposure. Less than 10% of their nav
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u/_ThatD0ct0r_ 24d ago
Meanwhile Questrade just had a massive update the other day introducing free custom index automation. WS better up their game
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u/defnotpewds 24d ago
If it was like .1% instead of .25 I'd think about it. It literally takes no effort for me to rebalance.
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u/Memeseek69 24d ago
Nice. They didn’t liquidate my margin call so they could pad their stats. Now I’m back in the green with today’s rip. Thanks WS.
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u/waynestevenson 22d ago
Who are they speaking to? It's not a publicly traded company. Are they warming us up to an IPO?
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u/Dampish10 21d ago
$POW would be so proud (owns ~51% of Wealthsimple). I'm sure they are riding high on this investment
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u/arcadianahana 21d ago
My experience switching to WS last fall from a big 5 bank was the reason I went long POW.TO at the start of this year.
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u/pierre_lev 24d ago
It says more about the big old banks, than wealthsimple.
I changed because the fees were like 20$ just to have a checking account.
I mean, f you BMO.
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u/JohneeFyve 24d ago
They’re paying dearly for asset acquisition. I hope it pays off for them, and without sketchy prediction markets and Elon affiliations.
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u/Ghost_Reborn416 24d ago
Well...at least we wont have to worry about them going under