Motif Investing

Motif Investing operated as a next-generation online broker, pioneering thematic investing for a client base that included individual and institutional investors. The firm was founded in 2010 by Hardeep Walia and Tariq Hilaly and officially launched in 2012. Walia, who served as CEO, brought experience from a six-year tenure as an executive at Microsoft and a background in economics and engineering from Yale and an MBA from Wharton. The idea originated from his frustration with the inability to easily invest in a broad concept, like the mobile internet, without buying numerous individual stocks. This led to the creation of the company's core product: 'motifs'.

A 'motif' was a curated, intelligently weighted basket of up to 30 stocks or ETFs built around a specific theme or idea, such as "Biotech Breakthroughs" or "Recession Resistant". This model allowed investors to buy a diversified portfolio aligned with a particular trend for a single transaction fee, initially $9.95, a significant cost saving compared to purchasing each security individually. The platform served as a hybrid between a do-it-yourself online brokerage and a robo-advisor, offering over 150 professionally built motifs while also allowing users to create and customize their own. Beyond retail investors, the company's subsidiary, Motif Capital, also developed thematic models for institutional clients like Goldman Sachs and US Bank's high-net-worth division.

The firm attracted significant attention and backing, raising over $126 million from prominent investors including Goldman Sachs, JPMorgan Chase, and Norwest Venture Partners. However, the business faced challenges as the industry evolved. Competitors began offering similar features like fractional shares and direct indexing, while the rise of zero-commission trading platforms like Robinhood increased pricing pressure. In April 2020, Motif Investing announced it was ceasing operations. The company was subsequently split, with its technology, intellectual property, and a majority of its engineering team, including founder Hardeep Walia, acquired by Charles Schwab to accelerate their development of thematic and direct indexing solutions. Its client accounts were transferred to Folio Financial, which was later acquired by Goldman Sachs, and then those retail accounts were sold to Interactive Brokers.

Keywords: thematic investing, online brokerage, direct indexing, portfolio management, fintech, fractional shares, investment platforms, financial services, asset management, stock baskets