Kenneth Mischel is the founder of WakeUp Pension, a startup that is disrupting the workplace retirement savings market with an algorithm that provides customized portfolio optimization.
“I don’t think the problem is financial education. I don’t think people lack the ability to do math in their heads,” said Mischel. “What happens is that people don’t have access to anything. And we think there are three basic issues in the workplace retirement space that have caused this problem. First is a lack of technology. Second is a trust gap, and that is because intermediaries in the market unfortunately have business models that cause misalignment of interests. Pension companies work for the pension companies and not for their clients, and that creates a misalignment of interests and a trust gap. Third is a paradox of choice. Give people too many choices and they choose nothing.
”WakeUp Pension seeks to distill the complexity and provide the technical and data-driven tools to enable people to make educated decisions about their investments". After establishing an account and answering some questions, the company’s algorithms automatically optimize a person’s portfolio and then paint users an interactive report where they can see their profile in a very personalized way. Mischel’s goal with WakeUp Pension is to provide advice to the masses in the most cost effective way possible. Right now, the company charges NIS 115 for workplace retirement advice and implementation, compared to traditional advisors that can cost hundreds or thousands of shekels.WakeUp Pension soft launched in October 2020 and has since advised about NIS 150 million in assets under management, according to Mischel.“I think we're going to make a lot of noise,” he said. “Now we wish to help Israelis, and then we plan to move on to many quarters of the world. There are 3.2 billion workplace-retiring investors with $50 trillion in assets under management and they are by far the most underserved group of investors in the world.”