How Nordic family office WealthTech differs from the rest

Scandinavians are often seen globally as tech-savvy and great designers. That is also true in the WealthTech space for family offices. This insight delves into conversations with four leading WealthTech providers in the region to explore what sets them apart from their competitors and what the future holds for the family office industry in the area.

What you need to know

  • Nordic WealthTech software is simple, functional and affordable, influenced by Nordic design. The region produces some of the most user-friendly and efficient solutions in finance.
  • Over the last decade, the family office industry in the Nordic region, including Sweden, Denmark, Norway, and Finland, has experienced significant growth despite the smaller population size of just over 27 million people.
  • Nordic WealthTech provides secure, affordable wealth management platforms for small and medium-sized firms and family offices with a customer-centric approach that outperforms larger traditional financial institutions.
WealthTech Published on Simple January 29, 2024

Nordic design distinguishes itself by functionality, simplicity, and minimalism, influencing various fields from interior decor to software solutions. Like Singapore and Hong Kong, the Nordic family office industry has grown significantly in the last 10 years. As a region, Sweden, Denmark, Norway, and Finland have established themselves as leaders in fintech and WealthTech solutions, which is all the more impressive considering the smaller size of the total Nordic population, which is just over 27 million people.

The Nordic fintech landscape

“The Nordic region has always been pioneering tech solutions to solve problems and bring value to the users,” says Tomas Engel, CCO of Swimbird. He adds that it’s not a coincidence that the Nordic region is growing from a WealthTech perspective. And he predicts that some companies in the field will be global leaders in the coming years.

Despite the recent downturn in fintech funding, investors have continued to show confidence in Nordic companies. For instance, fintech start-up Klarna received $4.5 billion in 2023. Nordic companies are well-known for producing high-quality products in the software sector and across various industries. Notable exports such as Skype, Spotify, and Lego serve as examples of the innovation and creativity of Nordic entrepreneurs.

What sets Nordic WealthTech apart?

Nordic WealthTech companies offer secure, robust, affordable wealth management platforms for family offices and their clients. They specialise in bridging the gap between small and medium enterprises in an industry dominated by giant US-based wealth management firms and traditional financial institutions. “The larger technology providers are the reason we exist and we are their opposite in many ways,” says Crispin Rolt, CCO of Performativ. Rolt continues, “We are nimble and efficient and have a competitively priced product that is specifically built to serve small to medium-sized firms and family offices.”

In addition to targeting small to midsize firms, Nordic WealthTech outsmarts traditional institutions by offering customised solutions with a customer-centric approach, solving specific pain points of wealth owners. “Larger players often have their support in global call centres, which customers frankly hate!” says Markus Alin, CEO of Sharpfin.

Family offices in the region

According to Ken Gamskjaer, CEO of Aleta, “In the Nordic region, family offices exhibit a relatively high level of digital adoption compared to many other regions.” He also notes that while the Nordic family office industry has made progress in digital maturity, there is still room for improvement. Many family offices in the region continue to rely on outdated technology providers for reporting, which can lead to significant internal workarounds and inefficient use of resources. “That’s why we built the Aleta platform specifically for family offices,” says Gamskjaer, highlighting their commitment to addressing the unique needs of family offices and facilitating a more streamlined and efficient wealth management process.

A recent study by the IDC shows that financial institutions globally suffer from outdated legacy IT systems, causing them to incur up to 21% of their annual costs. The study further highlights that the cost of maintaining these legacy technologies is growing at a yearly rate of 7.8%. Additionally, the cost of delaying migration to newer systems is also increasing.

Looking ahead

“We have certainly seen an uptick in both the creation of new family offices and multi-family offices in the region, and this seems to be accelerating,” says Rolt. He attributes this to a growing recognition that the availability of affordable technology will finally enable family offices to decrease operational expenses and exposure.

Another noteworthy takeaway from Gamskjaer is that wealthy individuals in the region have become increasingly conscious of how their investments impact the world. And he firmly believes that profit and purpose will complement each other in the future.

To sum it up

The WealthTech sector of Nordic family offices is a testament to the region’s long-standing reputation for innovation and tech-savviness. These Nordic WealthTech providers have carved out a niche in a landscape dominated by larger, global players with a strong focus on serving small to medium-sized firms and family offices. Their agile, customer-centric approach and competitive pricing set them apart, addressing specific pain points of wealth owners.

Moreover, the increasing digital adoption among Nordic family offices signals a growing recognition of the potential for technology to reduce operational costs and risks. As the industry continues to evolve, it is clear that the Nordic region’s commitment to both profit and purpose will shape the future of wealth reporting, aligning investments with a broader impact on the world.