Aspiration’s CEO Andrei Cherny holds up to grilling from Bloomberg anchors Erik Schatzker and Stephanie Ruhle in this video. Mr. Cherny’s recently launched firm (see: Unique Alts Fund From Aspiration Lets Investors Choose Their Fee) markets liquid alternative investments to middle-class investors, and boasts the innovative “pay what you like” investment-advisory fee structure.
Bloomberg’s Ms. Ruhle asks Cherny if it’s true that “you get what you pay for” in relation to his “free” advisory service. Mr. Cherny responds that his service isn’t “free,” and that he trusts investors to pay what they feel the service is worth, and to be honest. Traditional investment relationships require investors to trust their advisors – why not reverse the risk?
Mr. Schatzker seizes on Aspiration’s $100,000 maximum account size, pointing out that this means the firm will need to have a considerable number of customers to “keep the lights on.” Cherny refuses to give the number of clients Aspiration needs to break even, even after repeated prodding from Ms. Ruhle. Instead, he says that Aspiration’s aspiration is to build its business to serve the growing number of middle-class investors who can benefit from liquid alts exposure, and who will appreciate the “pay what you like” fee structure.