Startup Covestor Combines Social Networking With Investing [Video]
Facebook, for example, was recently valued at $50 billion, while social network for professionals LinkedIn recently garnered a $3 billion price tag on private secondary exchanges.
But other startups are trying to let investors tap into the power of social networks even more directly. Covestor, for example, lets its users easily mirror the portfolios of other successful investors.
More Transparency, Lower Costs
On the other hand, investors who want to showcase the stock-picking work they've done and build up their portfolios can use the technology to earn a following and get compensated in the process.
Covestor aims to bring transparency and reduce costs, founder and Chief Operating Officer Simon Veingard tells DailyFinance in a video interview. Those attributes have been sorely lacking in the financial industry.
Individual investors have long complained about hidden fees and mediocre performance. But the financial crisis led to an even greater clamor for accountability, says Veingard, and has further helped boost the company's prospects. For more on Covestor's strategy, see the video above.