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Now small nonprofits can invest like the rest of us

eCIO, a new Madison startup, offers comprehensive, affordable investment services tailored to small nonprofits.

eCIO

For a small nonprofit, having tailored investment services might seem like a luxury that’s out of reach. However, eCIO, a new Madison startup, exists specifically so those smaller nonprofits can get the investment advice they need to stretch their funds further and put the donations they receive to work for them.

eCIO officially launched on Nov. 1 and began onboarding its first clients by the end of the month. The concept and the technology build-out of the platform began in January 2019, based on a need co-founders Rob Roquitte, CEO, and Phillip Waara, COO, saw in the marketplace.

Beginning in 2014, Roquitte and Waara had built an investment practice at a Madison asset manager that provided comprehensive investment services to nonprofit organizations. As the practice continued to grow, it became obvious that it could not scale down to smaller nonprofits. Frustrated with having to turn away smaller organizations, they began to envision a technology-driven solution that could be offered at a lower cost than traditional investment services.

“As we began our market research, we quickly came to realize that small nonprofits were being ignored by traditional investment management companies,” says Roquitte. “They simply had limited investment options that were provided primarily by personal wealth advisors. That needed to change.”

Rob Roquitte, CEO
Phillip Waara, COO

eCIO was built specifically for nonprofit organizations. It was founded on the belief that every nonprofit, regardless of size, should have access to low-cost, professional investment services, resources, and tools.

Many investment management companies fall short of eCIO’s offerings, notes Tim Ivey, vice president of marketing. Not only do nonprofits benefit from low-cost investment management services, but eCIO also helps nonprofits evaluate their investment policy statements, spending policies, committee charters, fundraising strategies, and more.

Most nonprofits have a board or committee that is responsible for oversight of the investment program, explains Ivey. eCIO has built tools to specifically serve those oversight groups. eCIO takes a holistic approach to risk assessment and investment management. The process begins by administering a confidential needs assessment survey designed to ensure each member’s preferences are taken into account.

eCIO then works with the oversight committee to determine appropriate asset allocation utilizing risk, correlation, and return expectations.

Personalized, video-based portfolio reviews are uploaded quarterly to each of the nonprofit’s myecio.com portals where they can be shared between members of the organization. Should the members have any questions or need additional advice, they can utilize one-click access to reach their investment advisor.

Additionally, users have access to a comprehensive set of board management tools including user, document, and event management.

According to Ivey, eCIO created the myecio.com dashboard specifically for boards and investment committees to improve communication and better enable board members to meet their fiduciary duties. Through this portal, clients can customize their experience including authorizing members, uploading organizational documents, preparing and distributing meeting agendas, and scheduling meetings. The portal also serves as an interface, letting users view monthly custodial statements and quarterly, video-based portfolio updates from eCIO that can be viewed on-demand individually or at group meetings.

“Our purpose is simple,” says Roquitte. “Help nonprofits do more by maximizing their financial resources and thereby creating a positive impact on the world.”

To keep its services affordable for a client base of small nonprofits, eCIO’s strategy eliminates in-person quarterly portfolio updates in favor of the video-based portfolio reviews, which provides cost savings that can be passed down to eCIO’s clients.

eCIO’s approach to investment management is to promote transparency and simplicity, says Ivey. The advisory fee for the services offered by eCIO is 0.50 percent. Underlying money management fees range from 0.04 percent to 0.30 percent resulting in total fees of 0.54 percent to 0.80 percent for a typical balanced portfolio. By comparison, according to an investment management fee survey by the Commonfund Institute, the average advisory and investment fee cost for endowment and foundation portfolios less than $25 million is 1.34 percent.

eCIO looks to grow in 2020 alongside the portfolios of its clients.

Since Nov. 1, eCIO has onboarded four clients and has another for which it’s received approval from their oversight committees. The company currently has four employees and two consultants and plans to expand to 20 employees within the next two years.

While initial startup capital was provided by the founders and outside investors, eCIO will be doing its own fundraising in early 2020 with a Series A round of financing.

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