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Aspiration is the Uber of Financial Services, by Don Peppers

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Don Peppers explains:

Uber’s platform works primarily through the combined informational inputs of riders (who rate drivers) and drivers (who rate riders). Platform plays depend on a structure that serves mutual interests, and they often involve appealing to people’s natural desire to contribute, give back, or share, as well.  Airbnb, Waze, and BlaBlaCar (in Europe), for instance, all depend for their success on the good intentions of most of their members, as policed by reviews and ratings. And every day some new venture applies the "Uber" model to some additional task, from cooking or cleaning to shopping or shipping.  

The first wave of Uber-ization in financial services is probably what’s come to be known as peer-to-peer lending (ProsperLending Club, and Zopa are examples).  Peer-to-peer investing, on the other hand, is illegal in many countries. Syndicated investing is a highly regulated activity, and very few peer-to-peer investment vehicles have been able to clear that hurdle. 

A few weeks ago, however, I received an email from Andrei Cherny, who seems to have launched the next best thing. His new and rapidly growing financial advisory firm, Aspiration, may not rely on peers investing in peers, but it’s definitely based on investors showing their good intentions. Targeted at meeting the investment needs of middle-class people (many of whom don’t even have their own yachts!), the company accepts investments of at least $500 but no more than $100,000. And while most financial advisory services will apply management fees that are significantly more onerous on these kinds of small investment portfolios, Aspiration’s policy is “pay what you think is fair.”

Yep. Pay us whatever you think is right. That's Aspiration's model. Moreover, just in case this isn’t sufficient to appeal to everyone's good intentions, the firm also donates 10% of its revenues to charity. Seriously.

And so far, this seems to be paying off. In just the first two months of money management, Aspiration has already accumulated some $2 million in investor funds, and according to TechCrunch the firm has about 700 customers for its premier product, a portfolio of mutual funds managed by Emerald Assets. But while this makes Aspiration one of the fastest growing online investment vehicles ever, it remains to be seen whether Cherny’s venture will eventually become (gulp) profitable.

So why did Aspiration's founder email me? Well now it’s my turn to brag. Andrei wrote that he had contacted Martha Rogers and me simply because the concept for his company “was in many ways inspired by Extreme Trust” (the book Martha and I co-authored a couple of years ago). In our book, we chronicle the increasingly important role that person-to-person trust plays in a highly interactive society, and we even suggest that as we all get wired together more and more, trusting people to "do the right thing" is going to become an increasingly common business model.

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