"Anchor the benefits of super in the present": Q&A with Zuper CEO Jessica Ellerm August 2017
With boutique super fund, Zuper, set to launch later this year, we talk to co-founder and CEO Jessica Ellerm about what she has up her sleeve. Jessica tells Industry Moves why she feels “the ability to scale is no longer a function of size", talks us through the investment themes driven by her test group, and intrigues us with a ‘watch this space’ for a launch that aims to get millennials looking at their 70 year old selves.
- How do you plan to navigate the market and stand out from bigger, more established funds?
What many established businesses have been slow to realise - super included - is that the fundamentals of what makes a business competitive have changed. Thanks to technology, the ability to scale is no longer a function of size. This new competitive landscape has been coined the 'social era'. And it's not just about social media. It's about brands and businesses connecting and meeting consumers where they are - on digital platforms - and working with them to co-create a product and vision.
Our investment themes were driven by what our test group of customers wanted. Our future investment options will be crowd sourced. Against this you have a backdrop of social purpose being core to the Zuper brand and philosophy. So this idea that you can align your personal values with how your money is invested is something that really resonates with our target market.
- …and how do you plan to stand out from other ‘new’ super funds that we’re seeing introduced to the market that also have a specific member focus? What makes Zuper different?
No incumbent or startup has successfully combined product differentiation with cost leadership. Our intention is to land squarely here. Positioned against the social purpose piece, then its clear we are in a unique space that no one else owns.
We are also thinking about the bigger wealth picture. So while we have a laser like focus on super now, we know this is the start of a much bigger wealth journey that we want to guide our members down. When millennials (and the millennially minded!) think wealth creation in a year or two from now, we want Zuper to be the brand they associate with helping them do exactly that. Today no one talks to this market with any real authority or with advice that's any different to what was handed down to their parents.
- What research have you conducted around what millennials want when it comes to their superannuation and what were the key findings of this research?
The biggest finding from research we conducted early on in the discovery period was that emotional drivers are fundamental to breaking the cycle of apathy when it comes to superannuation. When you can connect the dots with someone that this is their money, and they can make a difference with it, a good portion of people will finally sit up and take some notice.
The other (unsurprising) finding was that while over 70 percent of the potential customers we researched felt like they were doing the most with their lives from a career and experiences perspective, over 80 percent felt like they weren't doing the most with their money. So the next layer in the Zuper journey is to help people uncover the behavioural barriers that create anxiety about wealth creation and break them down through smart product and education.
- Can you tell us a little more about the investments underlying your portfolio options Zuper Green, Zuper Health and Zuper Tech?
Our investment philosophy is entirely passive, meaning we use index funds and local and international ETFs inside our portfolios. This allows us to remove active management fees, which can be significant in some other funds, including some of our immediate startup peers. Fees eat away at performance. Simple as that.
- Interestingly, you’ve said that we care about our 70-year-old self in the same way that we do a stranger walking past us on the street. How do you make young people care about their older self?
It's super hard - excuse the pun! I think as much as possible, you need to anchor the benefits of super in the present. The big question is, how can you reward someone for taking action now for something that returns so far in the future? We are exploring a number of ways we can do this, and much of the thinking around this will be our secret sauce for launch. So watch this space!
- Who have you chosen to partner with for your regulatory and trustee obligations?
Diversa and OneVue are our partners on this side of the house. They've been fantastic and we are leveraging their knowledge and super know-how as much as we can.
- What’s your long term vision for Zuper?
Very early on we developed a manifesto for the business that shows the world what we believe in. One of my favourite lines in here is that we believe true freedom comes when you have the confidence to make good decisions about your life, future, and money. If we can help with the money part, we're on to a good thing.
- What prompted you to co-found Zuper?
I've worked in the fintech space for just over 6 years now, and one of the key things I realised was that to build a really disruptive business, that could compete against the financial status quo, not only did you need to have a bigger purpose, but you needed a brand that was unlike any other. When I met my co-founders, I realised they had the deep creative expertise to do this - in a sector that was wide open for disruption and that hadn't really served members interests as well as it could have. My firm belief is that without strong messaging and creative, while you can have the best technology, you won't crack the mass market.
- What has been the best piece of advice that you have received?
Focus, focus, then focus. And ideas are cheap but execution is all that matters.
- Who has had the biggest influence on your life of career so far?
This is such a hard one to answer! But probably the ex-CEO of Tyro, Jost Stollmann, who I worked alongside during my last year at Tyro. This gave me incredible insight into what it takes to run a business and steer a ship forward. He also provided me with a lot of autonomy, which accelerated my own development much faster than perhaps it would have under a different leadership style.
- What’s something that most people don’t know about you?
I gravitate towards eclectic hobbies! I've dabbled in fencing and I play the violin, viola and piano. Just last weekend I helped out a music camp for primary school kids. It was lots of fun and certainly different from running a superannuation company!
- If you weren’t in finance, what do you think you’d be doing?
I love learn about new things, write and communicate, so I could see myself in journalism or politics. On my bucket list is to write a book, and I'm lucky to have a few people in my inner circle who have already done exactly that, so I know it's possible! But the opportunities in finance and wealth are so immense, I can't see myself doing anything different for quite some time!