Want to ‘annihilate the racial wealth gap’? Make it easier for Black Americans to invest in stocks, says the founder of a new ETF – MarketWatch
The Value Gap is a MarketWatch Q&A series with business leaders, academics, authors, policymakers and activists on reducing racial and social inequalities.
Anthony Buchanan knows from experience how intimidating and frustrating it is to start investing without trusted sources or role models who share his culture.
That’s how he came to found Let Bob LLC, a Black-owned fintech startup, in 2017.
Buchanan’s mission is two-fold: to make investing more inclusive and accessible for Black Americans and other marginalized communities, and to get greater Black representation into the financial industry. The goal is to “annihilate the racial wealth gap in America,” he says.
A software developer by education, Buchanan teamed up with Black financial advisers and other wealthy Black investors, including Houston Texans player A.J. Cann, to create a financial-technology firm with an initial goal to get more Black Americans involved in stock-market investing.
Buchanan’s actively managed, artificial-intelligence-powered exchange traded fund, the AdvisorShares Let Bob AI Powered Momentum ETF
was launched in conjunction with AdvisorShares this year with $20 million in seed money. A robo-advisory platform is set to debut later this year.
The wealth gap between white and Black American families is massive. The typical white family has about eight times the wealth of the typical Black family — $188,200 versus $24,100, according to Federal Reserve data from 2019. That disparity has its roots in 400 years of institutional and systemic racism, academics say, and spans all facets of life.
Buchanan also is the founder and CEO of AppSolutions LLC, a software- and application-development consulting practice, in Birmingham, Ala. He lives in McCalla, Ala., with his wife and two children.
MarketWatch spoke with Buchanan via Zoom and email about his exchange traded fund, his experiences in the financial industry and his aim to increase Black ownership of businesses. This conversation has been condensed and edited for clarity:
MarketWatch: Let Bob — what’s behind the name?
Buchanan: Let Bob has a double meaning. First, B-O-B stands for “Black-owned business.” And the second meaning is a wink to the finance and technology industries, where Bob is a common name. I felt that it would be familiar, trustworthy and identifiable. Bob works on your behalf. I developed it to remove the worry often associated with investing — “Let Bob do it!”
MarketWatch: The Let Bob ETF is an actively managed, AI-powered fund. What makes the ETF different from the passively managed, large-cap ETFs such as SPDR S&P 500 ETF
which is …….