Investment Sponsor Spotlight: Pave Finance, an AI Based App

Written By: Daniel Gleich

Key Points 

• Pave Finance have constructed an app that can produce individually personalized portfolios built around investors’ values and fiscal goals.
• Constructed with the modern investor in mind, Pave aims to bridge the divide between elite moguls and newer investors.
• Through their brilliant and robust team of engineers, Pave has established a platform that has well-exceeded the expectations of its creators, instilling the hope that the investment management industry can change to a large degree.

Many individuals recognize the advantages of investing. Beyond the potential to generate additional income, it can also serve as a possible safeguard for your retirement. Despite this nearly universal understanding, there are still some investors who would like to gain a deeper understanding of how to properly approach an investing venture. This is when Pave Finance makes its introduction. 

Through the power of technology, Pave Finance has curated a process that’s structured to bring financial expertise to whoever seeks assistance. Historically, this type of backing is usually only available to the wealthy. Pave Finance’s ambition is to alter the investment management industry’s accessibility, with an emphasis on educating its users through its very own high-performance app. Those who desire to acquire investing knowledge can do so, all while having an active and potentially thriving portfolio. 

Let’s learn more about this pioneering tool and how it came to be. 

A Roundtable Vitalized a Revealed Demand

Christopher Ainsworth, the Chief Executive Officer at Pave Finance, has quite an extensive resume. He previously worked as the Head of West Coast at Deutsche Bank and even served as Chairman of CalALTs (The California Alternative Investments Association) for nine years. Initially, he began as a long-short tech trader in the hedge fund industry, spending the bulk of his career focused on the dynamic of markets and helping people to likely receive better returns. Ainsworth attributes his plunge into the financial realm to his competitiveness, which originally surfaced during his years as an athlete.  

Throughout the COVID lockdown, Ainsworth - and a group of like-minded individuals with tremendous financial acumen - met virtually every single Friday. The members of these calls derived from various areas in the financial sphere, including insiders from Washington and top-level hedge fund traders. Within these exchanges, they discussed the occurrences in the present-day market, dissecting trends, and their predictions. Against the prevalent difficulties, the market was generally up. Despite this realization, a whopping 70% of the investors trading on apps like RobinHood were typically losing money. 

This gathering of global and geopolitical individuals wanted to find a solution. It seemed most investors did not have access to the upper echelon of financial experts. Was there any sort of framework in place to help these people? Their digital deliberation ultimately led to the premise and cultivation of Pave. 

From Daydreams to Devices

Ainsworth and his colleagues set forth on their mission. With their own app as the vision, they knew a structure had to be developed. One that could implement their vast fiscal knowledge and years of experience in combination with an automated system submerged in machine learning and artificial intelligence. They sought a gifted team of computer science graduates from prestigious institutions such as Berkley, Stanford, MIT, and Carnegie Mellon, and recruited engineers from Google, Meta, Drivewell, and places of similar credibility.   

Within nine months, their team built Pave’s first iteration. They released their beta version for testing, observing how the software corresponded to its users’ wishes and the typically changing tides of the stock market. To their surprise, the technology resoundingly outperformed. It even began surpassing the brainpower of its creators. Thus, their final software was constructed. 

How Pave Finance Works

Two software products were established and are currently obtainable: 

Phone App

This is available for download on iOS, Android, or Google Play. Through the Pave Finance software, you have access to all the pertinent investment guides; it essentially behaves as a funder, robo-advisor, and broker all in one. Pave Finance grants you the ability to customize your portfolio in alignment with your interests and financial goals.

You can decide whether you want the software to be automated. If you choose to automate, monthly, your portfolio will get automatically traded in accordance with the market's ebbs and flows. Your portfolio will consistently adjust based on economic conditions. Other than specifying your preferences, your sole responsibility is to deposit money. 

Desktop

Their other product is a professional version of the software, generated for desktops. This is geared more towards investment advisors, RIAs, broker dealers, and family offices of the world that need assistance with managing their money. Instead of paying third-party money manager fees, you can use their software at the cost of one flat-rate licensing fee. Ainsworth considers it like Bloomberg for investment management.  

This version was rolled out through Charles Schwab’s institutional platform. Within six weeks, it accrued over half a billion assets, proving itself to be a newfound marvel. 

Changing the Game

The software breaks every single publicly traded equity security into 157 pieces of information. These pieces include fundamentals such as earnings, earnings growth, and valuation. It also includes technical elements like how the stock price moves, relative strength indicators, oscillators, etc.  

Artificial intelligence and algorithms break stocks into quantities and generally make informed decisions regarding what drove the market’s performance based off its respective discovered data. In conjunction with this data, it also considers economic circumstances such as inflation, jobs, GDP, and other factors that tend to correlate to stocks. This allows it to try to predict what will happen next. Their software currently has a record of beating the market on average of two percent a year since 2010. 

Pave also lets its users handle investing in a manner most suitable to their aspirations. To further diversify your portfolio, you can opt to run a multi-asset class portfolio, incorporating fixed income investments and stocks associated with alternative assets. Pave also considers commodities such as oil, gas, gold, and other currencies such as Bitcoin.  

Ainsworth mentions the type of service that Pave Finance provides is usually only accessible by billionaires: having your money run by a virtuoso in accompaniment with complete account personalization. Almost anyone that’s interested in embarking on a new investing journey can join Pave – it only takes $50 to open and fund your account. On average, investors pay huge fees to money managers who – in comparison to the genius of the software –underachieve. The Pave Finance software has the potential to completely transform the investment management industry as we know it. 

Who It’s Good for

You may want to consider Pave: 

• If you’ve never invested before and you’re interested in learning how to do so and grow wealth over time. 

• If you’re interested in investing but are busy and would prefer not to be too involved. 

• If you’ve invested before but have made mistakes in the past and know that you may not have all the answers. 

Ainsworth is proud of the educational resource center Pave Finance has developed, better known as Pave Academy. They offer educational classes ranging from a college-level 101 course to offerings as granular as explanations on derivatives. Pave prioritizes their intent to give support to people on their investment journey through all possible means. 

What’s in the Cards

Although past performance doesn’t necessarily elicit a guarantee of future results, Ainsworth reiterates that he and his colleagues are pleasantly surprised with how well the software can construct and build portfolios. The creation of this technology has been an accomplishment in and of itself.  

As Pave Finance is entirely self-funded, what they’re hoping to achieve is further implementation: getting adoption, executing regulatory oversight, and raising capital to aid in sharing their program with the masses. 

Interested in Self-Directed Investing?

There’s no time like the present to start preparing for your retirement. Madison Trust’s Self-Directed IRA Specialists are readily available to answer your questions. Schedule a free discovery call today to learn more! 

This content is for educational purposes only and is not an endorsement.  

Madison Trust provides custody services to certain Pave Finance principals but is not paid by or has any financial interest in Pave Finance.