RISE Founder and CEO Talks about AI for Investing and Their Aim to Issue the Largest STO in Europeby Fintech News Singapore August 22, 2019
Stefan Tittel, CEO and co-founder of RISE Wealth Technologies is a Serial entrepreneur with an impeccable track record.
He has led several* companies throughout their complete business life cycle. He talked to Fintechnews about his company RISE Wealth Technologies, their plans and the current STO, which aims to be the largest in Europe.
1. What is RISE Wealth Technologies and what does it do?
RISE is a Germany-based software company developing sophisticated algorithmic trading technology using artificial intelligence (AI) and machine learning (ML) systems which have successfully traded on traditional financial markets for years. The patent-pending AI Machine Learning platform will fundamentally change the way that funds, investors and asset managers make investments. The RISE methodology enables investors to continuously discover, validate and implement new trading opportunities in both highly liquid and illiquid financial markets across the globe.
The RISE technology-based financial solutions have outperformed competitive products since 2016. The company’s next step is to scale into the $80 trillion global asset management market. With the current STO, RISE aims for the largest European STO with $120 million target volume, to grow the business and expand globally and to extend their product offering for retail investors. At present, the company is financed with US$ 11 million and employs a workforce of around 20 experts in branches located in Munich, New York and Paris.
2. How did the idea come up?
Originally, after my first company was sold (for more than USD200m to SAP) I asked myself where to effectively place and invest my earned money in the financial markets without the risk of losing it. Since I couldn’t find a convincing solution in private banking and funds, I looked deeper and identified a core problem in the market and decided to build an AI software to solve it. That was pretty much the starting point.
3. What is the company’s competitive advantage? What differentiates RISE from competitors?
We are changing the way how funds, investors and asset managers invest. Human trading is being replaced at a staggering speed by automated, data-driven algorithms. In global financial markets, as in all other spheres of life, using computers that beat the human „computing capacity“ by billions, simply produces better results. In the future, the most successful asset managers will be technology companies.
RISE is part of this exact group and has a massive technological edge. Our team of experienced serial entrepreneurs has built RISE over the last 7 years with the ultimate vision to be the „next big thing“ in the asset management world. We’ve recruited an all-star team and invested millions to build a set of self-learning, continuously improving trading software utilizing artificial intelligence and machine learning that will change the way how funds and investors trade. This technology, patent-pending, is the future of asset management.
RISE is financed with a $8 million pre-STO investment round by all-star investors and is led by an experienced team of FinTech serial founders who have successfully built and exited several companies before RISE. We’re now ready to scale.
4. What is unique about the STO and the RSE token?
RISE offers a 50% discount on the dollar in Phase 1 (volume limited) to accredited and professional investors. Apart from that, the token /participation right is valuable in itself; it comes with repayment of 8% p.a. plus dividend plus a non-dilutable exit participation.
With our Secure Token Offering we offer a model to invest in our enterprise success. The RSE token pays out quarterly dividends from all profits that RISE generates. It allows regular investors to benefit from the massive potential and wealth generation of the unparalleled shift towards AI-powered investment management. RSE holders get quarterly profit payouts from RISE’s main drivers of profits – the strategy licensing revenues from institutions and revenues from its retail platform.
Furthermore, RSE token holders are entitled to a $0.04 annual payback per token for 25 years up to a full repayment of $1.00 / token. For phase 1 investors, this is an 8% p.a. extra payback (on top of profit payouts). Last but not least, RSE holders participate in a potential IPO or Sale. Which means, should RISE be listed on an official exchange or be acquired, token holders will receive a share of the proceeds.
5. What are you looking to accomplish during 2019?
This year, 2019, is of course dominated by our STO. With a target issue volume of $120 million, we aim at completing the largest European STO to date. This is our main focus at the moment, to achieve this goal. The first phase for professional and accredited investors is still open till September 15, 2019 – the second phase of the RISE STO will be opened to all investors pending regulatory approval and jurisdiction.
But also, on a product level, we have exciting launches planned for this year with the release of the RISE Autopilot as well as the planned release of the RISE Crypto Trading Hub.
6. Does RISE have early customer validation? How many downloads and/or registered users have you recorded so far?
RISE has several products on the market. With RISE Pro we are servicing an institutional customer base who are able to utilize our software to more effectively manage capital. The RISE Retail products include several brands such as the RISE App and the RISE Crypto Scanner with more products in the pipeline.
While multiple institutional clients use RISE Pro, over 100,000 users have access to the RISE App from our previous UpTick brand, as well as currently over 2,000 early adopters are using the RISE Crypto Scanner.
7. Why AI is needed in investing? What’s the next step in AI/ML Investing?
Machines work more efficiently than humans and, above all, without emotions. Artificial Intelligence and Big Data analysis can identify trading signals that are impossible for humans to recognize. Machines process information better, so algorithms are also perfect for Crypto and coping with a high degree of volatilities. Therefore, they will help the investor avoid all of the risk and inefficiencies that inevitably arise with human-influenced trading especially in the crypto market with overheated markets or markets depressed by blind pessimism. AI/ ML based investing replace gut instinct and intuition with facts and artificial and data-based powerful intelligence.
Our patent-pending AI platform uses a combination of statistical methods and machine learning to search for promising new trading strategies and then validate and optimize them using an ongoing iterative process. Machine learning algorithms are able to scan and process vast amounts of data and distinguish real patterns, connections hidden to human logic, from random events also avoiding subjective human interpretations and thus derive suitable trading strategies. This allows us to basically feed our platform with data of stocks, futures, cryptocurrencies, etc. from which the platform then generates multiple valid trading strategies based on this data.
8. Your team has been focusing for some time on AI/ML-based trading algorithms. Are we approaching some sort of mainstream adoption, in your opinion?
Elite investors are already using artificial intelligence and machine learning in investing to gain a competitive advantage. However, we are still far away from mainstream adoption. Today the largest asset managers are still traditional finance companies, which will change in our opinion. The largest asset manager in the future will be a technology company – not a bank. So we are just at the beginning of the disruption of the financial industry as we know it today.
9. What is Rise’s revenue model? How are you going to be making money?
Banks and hedge funds pay license fees to trade assets using customized strategies developed with Rise’s proprietary trading software. The licensing fee structure is based on the standard of the industry – a management fee and a performance fee. Retail clients will also pay fees to use retail trading products available via Rise’s trading platform and mobile app. These fees form the basis of Rise’s revenue model.
*These companies, with total investments of more than $90m, generated substantial value for their investors. These companies previously have been founded or co-founded by Stefan Tittel: CROSSGATE AG (a B2B SaaS platform, market leader, sold in 2011 to SAP), TRAXPAY AG (a B2B real-time, blockchain-based payments platform, became a strategic investment by Commerz Bank and Software AG in 2013), Masterpayment AG (an online payments and working capital finance provider, sold in 2016 to NASDAQ-listed Net1 group), QUANTUMROCK Capital (a licensed asset manager), SINUS CULTUR (a property development company).
Featured image credit: screengrab from Youtube