Global Fintech Interview with Ksenia Yudina, CFA, Founder and CEO at UNest

Hi Ksenia, welcome to our interview series. Please tell us about your role at UNest and how you conceived the idea of starting the company.

I’m UNest’s CEO and Founder, but I am also an RIA (Registered Investment Advisor) and CFA charterholder. In previous parts of my career, I often advised families and individuals on how best to invest in their children’s futures, and I realized that it’s a very complicated landscape, with differing offerings even from state to state.

As a parent myself, I realized that there was a real need for families of all income levels and backgrounds to have a fast, efficient, and easy-to-understand way to save and invest in their kids’ futures – outside of just saving for college. This is our core mission at UNest and one I am proud to keep working on every day.

Fintech Updates: 9 Best Fintech Innovations Of 2022

What are your core offerings? How do you fit in the ever-growing Fintech landscape?

We are at the center of the trend of fintech democratizing access to previously unavailable ways to manage their money. Even now, 70% of young families are unaware that solutions like a UTMA (what UNest offers, a Uniform Transfer to Minors account) or a 529 exist. But we are very focused on our current mission to help families save and invest in kids. Parents open savings and investment accounts with UNest for their kids from their smartphones in under five minutes. Then, they set up a recurring monthly contribution of as little as $5, with access to set-it-and-forget-it advisor-guided portfolios that are based on age and risk tolerance. We offer the ability to invest in crypto and green funds alongside traditional ETFs for further diversification of assets. Family members and friends also contribute to a child’s UNest account through our gifting feature, which offers the opportunity to give a meaningful gift rather than a toy. Parents also earn rewards from top brands like Disney+ or Nike when they shop through our platform.

Another feature I’m really proud of is UNest Learn. This feature answers parents’ questions with tips, tools and content to help them make smart financial decisions as they continue to save and invest for their kids. Of course, we’re always working on more ways to help parents and kids – watch this space!

You are backed by strong investors, partners and ambassadors. Would you like to highlight the crux of your relationship with your key stakeholders and customers?

We are very proud to be backed not only by top tier venture capital firms like Draper Dragon, Anthos Capital, and the Artemis Fund, which specifically backs startups founded by women, but also by major financial institutions like Franklin Templeton and Northwestern Mutual.

In addition, we count NBA All-Star Baron Davis as an investor and ambassador, with both Laura Dern and Hannah Simone as brand ambassadors too. What lies at the heart of these relationships is an understanding of our mission and the team and technology that backs it up. Every parent has worried about how they can best save and invest for their children to make the biggest impact. We not only have the technology expertise to create a seamless experience, but the financial understanding needed to provide the solution that parents can trust. For example, we are a FINRA registered broker-dealer.

Our investors, partners, and ambassadors understand our purpose-driven business model and believe it has a huge potential for growth. It’s why we’ve already helped tens of thousands of parents set up accounts for their children.

Please tell us about the unique challenges faced in the initial months of launching UNest. How did you scale your business in such a short time?

Fintech is a notoriously difficult sector to enter. It’s not merely that it’s a high-stakes, highly-regulated space. Finance is, by its very nature, an old business. There’s a lot of old technology, particularly within the legacy banks.

On a technological level, this presented some compatibility and scalability challenges. Some institutions couldn’t handle the volume of accounts and transactions we generated. Others struggled to interface with our in-house systems, forcing us to find workarounds. In one case, we had to verify new accounts using faxes!

Then there’s the trust element. People are instinctively cautious when it comes to money. They’re even warier regarding their children and their financial future. As a new and unknown brand, we had to work hard to win the confidence of our customers.

At the same time that we faced these challenges, we simultaneously navigated the process of fundraising and recruiting during the pandemic. Lockdown meant our workforce was virtually fully-remote, which added friction when it came to team building and aligning our shared goals for the business.

You are pursuing a very novel objective of securing children’s financial status. Could you explain a bit about your unique features that set UNest apart in Fintech?

There are plenty of fintech products that cater to savers.

But few — if any — are geared towards parents looking to provide for their children’s financial future. Fewer still combine the simplicity of UNest’s mobile app and its ability to provide tax-advantaged and affordable savings products.

Put simply, UNest eliminates the cost and friction in finding the right savings product for your child. It’s faster and simpler than buying an advisor-guided investment plan, like a 529 or a custodial account. And beneficiaries can use these funds on things besides education expenses — like starting a business, getting married, or buying that first car.

UNest is also significantly different from other existing kid-focused financial solutions that focus on managing allowances. The average age of the children signing up for these debit-card focused solutions is 12. Most of the kids on the UNest platform are 0-5. As a broker/dealer, we focus on helping families save and invest for the long term. This is a very different value proposition from solutions that focus on how teenagers spend!

What do parents require to start the UNest Investment Account for Kids?

Parents are busy. Their time is precious. And so, we make it incredibly easy to open a UNest investment account. The whole process takes about five minutes from start to finish, and you can fund your account with as little as $25.

Your reward system is very enticing and involves some renowned brands. How does the reward program tie in with a child’s financial future?

Most shopping reward programs work like this: you buy something, wait a few months, and hope the reward gets credited to your account. Eventually, you have enough rewards to ‘cash-out.’ It’s a time-consuming and unfulfilling experience. And it’s often hard to use these rewards in a deliberate, mindful way.

Our approach differs. When you buy something from one of our 150+ brand partners, the money goes straight into your child’s savings account. We work with some of the biggest names in retail, leisure, and entertainment — including Disney+ and DoorDash — and parents can add hundreds of dollars a month to their child’s nest egg without changing their spending habits.

Tell us UNest’s customer service management benchmarks and how these evolve with user needs and wants.

For parents, few things are as important as their children’s financial future. Our job isn’t merely to deliver the most tax-effective and versatile savings products. It’s to be a trusted partner that parents can rely upon.

To accomplish that, we’ve built a sophisticated customer happiness system. We carefully monitor support requests and feedback, have strict KPI benchmarks that we strive to meet, and have a central hub that allows us to swiftly address and remediate customer problems.

You are working with iHeartMedia for audio promotions. Please tell us about this partnership on national media campaign.

As the largest radio station network operator in the United States, iHeartMedia has a massive audio network including broadcast radio, podcasts, digital, social, events, and marketing. Our partnership lets UNest leverage that network to reach parents and parents-to-be to share the solutions available to ensure their children experience financial security and freedom. It’s already successfully launched in six test markets including Tucson, Houston and Columbus, and now we’re rolling it out nationally to reach millions of households who are looking for guidance and a truly accessible way to save and invest in their kids’ futures. It’s a really exciting partnership and I am excited to reach more parents this way!

Tell us more about your other marketing campaigns across web, mobile and display. What is your objective for 2023?

Our goal for 2023 is to cement our position as a trusted savings and investment product that young families rely upon. We plan to build upon the incredible progress made during 2022 by expanding our brand-building program. Our partnership with iHeartMedia is a good example of this.  At the same time, we’re also looking to accelerate the pace of customer acquisition at UNest. We’ll achieve this through a blend of performance marketing, influencer-driven content, PR, and by forging new partnerships.

 Your predictions on the future of Fintech-for-kids app and services.

The first generation of fintech for kids was focused on spending solutions – debit cards with allowance management tools. These were basically neobanks focused on a younger audience. This category has become saturated, and the typical relationship that these fintechs have with their customers is very limited – a few years before the customer moves on to a more mature financial product. We are at the forefront of a new breed of kid-focused fintechs that helps families on a more profound and longer-lived basis. We predict that saving and investment solutions like UNest will redefine how families engage and build relationships with their financial providers. We have already seen this in our first three years in market.

From a broader perspective, the saturation of spending/allowance fintechs for teenagers will almost inevitably lead to some consolidation.

A fintech podcast that you would like to participate in:

Planet Money would have to be my top choice. I find their in-depth looks at not just fintech, but the broader economy and finance fascinating.

Thank you,  Ksenia! That was fun and we hope to see you back on globalfintechseries.com soon.

[To share your insights with us, please write to sghosh@martechseries.com]