Toronto-based FinTech giant Wealthsimple has purchased Montréal investment research platform Fey.
The financial terms of the transaction were not disclosed. Wealthsimple told BetaKit the acquisition of Fey’s three-person team and technology positions the financial services provider to “bridge the gap between basic trading apps and complex brokerage platforms.”
Wealthsimple plans to integrate Fey’s design, earnings analysis, natural language stock screening capabilities, and personalized news feed into its investment platform. The company said its users can expect to see the first Fey-powered features roll out later this year.
Wealthsimple vice-president of design Polly D’Arcy told BetaKit that Fey will help Wealthsimple bring more professional-grade investment research features to its clients “much faster.”
“Wealthsimple shares our belief that finance can be both accessible and sophisticated.”
“We want Wealthsimple to be the platform where Canadians build wealth, whether that’s through investing, trading, saving, or borrowing,” D’Arcy added. “Enhancing trading capabilities is an important step in making sure we serve every type of client, from long-term investors to active traders, all under one roof.”
Fey was founded in 2021 by principal designer Thiago Costa, engineers Dennis Brotzky and Thomas Russell, and former head of operations Mack Mansouri. Costa and Brotzky met during their time working together at Lightspeed Commerce, and they teamed up with Russell and Mansouri to launch Montréal design studio Narative, which counted Hopper among its first clients. Narative later evolved into Fey, which raised a small, undisclosed amount of venture funding from Maple VC, Inovia Capital, Yuri Sagalov of Wayfinder, and Abhinav Tiwari at Blank Ventures.
“Fey was always something we built for ourselves first,” Costa told BetaKit. “Narative’s runway gave us the space to build methodically, without rushing to market. We started invite-only, which let us form close relationships with early customers and refine the product. Once it felt ready, we opened access more broadly, kept marketing light, and still achieved good growth.”
Costa said it was after Fey opened up access that Wealthsimple reached out. The company will wind down its operations by Sept. 30 and refund customers for the remaining balance of their subscriptions following that date. While Mansouri departed Fey in 2023, the startup’s remaining employees, Costa, Brotzky, and Russell, will all join Wealthsimple’s self-directed investing team. D’Arcy described the trio as “exceptional designers and engineers who had already proven they could ship tools traders loved.”
Fey marks Wealthsimple’s second known acquisition this year, following its acquihire of San Francisco-based wealth management platform Plenty back in April. D’Arcy said Wealthsimple plans to continue exploring acquisitions that help it bring simple, intuitive financial tools to Canadians.
Since its launch as a robo-advisor in 2014, Wealthsimple has broadened its investment capabilities and moved into other areas of money management. Today, Wealthsimple offers investing, crypto, tax filing, spending, and saving products, and is one of Canada’s most valuable private tech companies.
Wealthsimple is majority owned by Power Corp. affiliates and relies on partnerships with banks to offer banking services and hold and guarantee its deposits. The FinTech firm has amassed more than three million clients after achieving profitability in 2023.
Wealthsimple hosted its inaugural product showcase in June, revealing new banking products with fewer fees and without the branch visits required by its incumbent competitors. These included the company’s first credit card, an instant line of credit, an expanded chequing account, and home bank draft, cheque, and cash deliveries.
In an interview with BetaKit following the event, Wealthsimple co-founder and chief product officer Brett Huneycutt outlined the company’s vision for the future of banking and investing in more detail, promising that “there will be a lot more to come” as it executes on its plans to become “the one-stop shop for financial services for Canadians.”
“There will be more to say about how we’re killing our robo-advisor and reinventing it into something much better,” Huneycutt said at the time, indicating that Wealthsimple is also working to ensure that its brokerage offering is both more “compelling and complete.”
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Wealthsimple also indicated that its second edition, slated for this fall, will feature some investment product news, including more sophisticated and personalized trading capabilities, access to new private markets, and crypto-related products, among other things.
Wealthsimple could face more competition on this front soon from one of its larger American peers: US trading platform Robinhood Markets recently struck a deal to buy Toronto crypto company WonderFi and shared plans to develop its offering in Canada.
Wealthsimple has seen significant growth over the past year, closing out the second quarter with $84 billion CAD in total assets under administration (AUA), a nearly 94 percent increase compared to the same period last year, which puts the company well on the way to reaching its target of $100 million in AUA by 2028.
Power Corp. recently marked up the value of its stake in Wealthsimple once again to $2.7 billion, up from $2.2 billion at the end of 2024. The financial services conglomerate cited an increase in public market peer valuations, Wealthsimple’s performance and revised revenue expectations, and recent third-party secondary transactions. According to Power Corp.’s latest earnings report, Wealthsimple had 2.8 million clients, excluding tax filers, at the end of Q2.
Wealthsimple’s 2024 secondary financing officially valued the company at $5 billion. While other investors may value the firm differently, as Wealthsimple’s largest and controlling shareholder, Power’s latest markup offers a framework to evaluate where Wealthsimple’s valuation may sit now. Power now valuing its fully diluted 42.2 percent equity stake at $2.7 billion indicates that Wealthsimple could be worth as much as $6.4 billion today.
Disclosure: Wealthsimple vice-president of payments strategy and chief compliance officer, Hanna Zaidi, sits on BetaKit’s board of directors.
Feature image courtesy Fey.