I have been working in product management for 2-3 years and I have learned a lot, but there is still a lot to learn. As I am looking for new roles in product management, I figured I would flex my product muscle by doing some product briefs. Here is Compound Financial.

Product Brief: Compound Financial

Overview:

• Compound acts as a digital family office for it’s members. The platforms aims to be at the front of wealth management innovation by including services such as digital assets, private investments, stock-option exercising, and in-house tax advising.

• The business model from my view, is similar to Strava’s model. A type of freemium that offers a great free tool to users before they become a paid member. Compound’s funnel likely looks something like this:

The free net worth tracker is great for two things:

1. Great Marketing: The tool can be marketed widely across any demographic Compound wants. Net worth tracking tools have never been perfect, and Compound’s is one of the best I’ve seen.

2. Develops User Trust: I’ve spent years around the finance and wealth management space. One thing I’ve learned is that trust is one of the most important aspects of the business. If a user came to Compound’s landing page with the CTA being to become a client, conversion rates would be low. But, when you offer a valuable free tool, like the Net Worth Tracker, it allows for users to get comfortable and develop trust with you and your product before becoming a paid client.

   2a. The internal data that Compound gets from users of the free Net Worth Tracker likely can help them shape their products and services for their clients a lot better.

Key Features

• As mentioned above, the free Net Worth Tracker is one of the biggest features that Compound offers. This is everything you can add to the tracker:

  

• Team roadmap planning with you financial advisor: Compound gives you a roadmap that shows the next steps for and your team to complete. It provides a sense of comfort for clients knowing what is next.

• The Vault is also a creative feature for a wealth management. Clients are able to store important financial and employment related documents directly in the platform.

• The Flow feature is a demo environment where clients can see how life events can affect their net worth. Things like buying a house, exercising employee options, or job changes can be added to your net worth tracker and show the real time changes down the road.

User Experience

• Hats off to the designers of Compound, it is a delightful user experience. At the end of the day, platforms like this just need to relay information in an easy-to-understand manner. Throughout the platform the user experience and design is very clean and easy to navigate.

• Painpoint: One of the only flaws in the user experience is indicating interest in a new investment strategy. In order to gain access to new strategies, you have to submit an interest form. This area is a great place to incorporate AI chat bots to learn more about what a client wants from these investment strategies so the advisor could better prepare. It could also make the user feel more satisfied with the experience having dove into the details more rather than just clicking “send”.

  

Recommendations & Opportunities

Improve or expand?

One of the most important lessons I learned as a product manager is how to decide when to improve existing features vs build out new ones.

The answer obviously lies in the strategic goals of the companies, the quarterly KPIs, and the underlying product data.

Since I don’t have access to any of these, I am going to try to touch on both.

Improving Existing Features

In order to improve existing features, I am going to have to work to predict user problems that are occurring based on my experience. Based on my time in the product, these are a few guesses:

1. Users not connecting accounts

   1. Problem: This is an issue that I saw during my time at Commonstock as well. Having to rely on users to connect their own accounts can be a point of friction that is for the most part, unsolvable. Because you’re relying on a third party service (in this case Plaid) and dealing with regulation and privacy laws, there is not much to do on the underlying product side here.

   2. Possible solution: Although it isn’t your product you’re relying on, adding incentives or new UX fields can maybe help push users to connects all their accounts. For example, if users want to add all their accounts at once, building an onboarding-like experience where users type in all their accounts, then can go through one by one in the module would be a better experience than adding each one at a time.

2. Free users not converting to paid members

   1. Problem: For any freemium tier business model the end goal is to convert the free users into paid users. Now, like I mentioned before I don’t know the data, Compound could be converting at a high rate, or they would like to convert more. For the meaning of this brief let’s say they would like to convert more.

   2. Possible Solution: From my experience within the freemium tool, Net Worth Tracker, it is not clear the upgrades I get with the Compound Membership and becoming a client. The membership page has very vague language and does not give a lot of insights into the possible upgrade.

      The freemium model should include blocked or limited feature use that builds user interest in the main product. Take Strava from below for example, I can look at a few trails around me, but the other ones require me to subscribe and buy the full product.

3. Users are churning from the free tool, retention is low.

   1. Problem: From what I have gathered, the Net Worth Tracker itself does not having any re-engagement plans for users. The more time users spend using the free tool, the higher probability they will become a client. This is why it is very important to keep retention numbers high. Again, I do not know the retention numbers, so for this example let’s again assume that they are low.

   2. Possible Solution: Create re-engagement plans through email content or alerts. This will likely require some collaboration with marketing, but if there is a way to personalize contents and alert that will send users back to the dashboard, there is a higher probability they will keep coming back.

Expanding Feature Set

Most of these feature ideas and add-ons will utilize existing data that Compound already has. Incorporating artificial intelligence will also help these features become better and run more efficiently as well. I will touch on this more below.

1. Add a Wealth Context Dashboard at the top of Wealth page: A place for major events since last visit, new opportunities, etc

   1. Problem it solves: One thing that I noticed in the demo environment is that there is little context to the wealth tab. There is a lot of information and great breakdowns of how your net worth is composed, but not a ton of written context. A dashboard at the top including things like major events since last visit (big earnings report from one of your holdings), new investment opportunities, or big upcoming events can provide clients with a brief overview that develops trust and potentially reduces client outreach to advisors.

2. Add a Peer Comparison section: What are similar people doing with their money?

   1. Problem it solves: Investing since 2020 has become a social animal, especially for those under 30. As the future generation matures and starts to manage their money, adding context to what other people are doing in similar situations will allow clients to feel like they are on track. Adding context like “76% of people in your situation are exposed to private funds. Learn more.” or “44% of Stripe employees have sold shares in the past week. Learn more” can maybe help clients feel more comfortable about their financial positioning.

      Where would you put this peer comparison section? I will leave that more to the designers, but it also really depends on how much data the team wants to utilize. I would start by just adding a sentence or two to something like the context dashboard or another communication. If users end up appreciation the feature and want to learn more, then building out a larger section should be discussed.

3. Integrating AI

   1. Problem it solves: I know I know the AI craze can be suffocating at this point, but having worked with technology, I’ve seen how powerful it can be in the right situations. Compound has a ton of data at it’s disposal and AI is extremely powerful when trained with custom and niche data.

      Training an AI model on Compound data will allow it to give personalized insights and ideas to clients. In the Peer comparison situation above, a human doesn’t have to scroll through data to find something to provide to the client, an AI can do it in 5 seconds and pass the findings along.

      In the wealth context dashboard, analysts don’t have to manually enter context into each dashboard, an AI can easily do that based on available data. If someone holds a lot of NVDA stock and they have earnings that beat by 20%, an AI will be able browse the web and see that, then relay that information to anyone holding a significant portion in the stock.

Final Note

Based on everything above, Compound is in a great spot and has built a great product. As they continue to move forward, diving into the data and user research will be extremely helpful in making product decisions. I would bet on this company moving forward, the wealth management space is ripe for disruption.

If you appreciate the product brief and would like me to do one for your product or company, reach out to me at [email protected].

Cheers, Tom.