Traditional banking has – eventually – adopted innovations such as digital-only accounts and smartphone payments. However, some elements of the financial infrastructure are still firmly stuck in the past, as anyone who has tried to gift money to a child in forms other than cash or vouchers will have discovered.
Having run across this problem himself, Niall Dennehy began mulling over a possible solution. He applied his background in banking, telecoms and digital payments, and in June this year launched NestiFi, an AI-powered investment platform allowing parents, grandparents, relatives and friends to invest in a child’s future as a group.
To start the process, a designated adult downloads the free app and sets up an account for the child. This provides access to a personalised link they can share with family and friends who want to contribute to the child’s nest egg.
The person overseeing the account then chooses from a range of low-fee index funds and invests the money. Performance expectations are based on a 7.2 per cent average annual return, which Dennehy says is the approximate historical average (adjusted for inflation) of the S&P 500 over the past 30 years.
NestiFi does not need a banking licence as it does not hold any client money. Investments are made through licensed/regulated intermediaries such as brokers, credit unions and brokerage-as-a-service providers.
“NestiFi rethinks investing through the lens of family and collaboration,” he says, adding that it is designed to support families in several different ways, whether that’s to save for college fees, give gifts of digital assets or introduce children to the concept of financial literacy.
“The platform supports traditional investments such as stocks and ETFs as well as blockchain-powered assets like stablecoins and tokenised real-world assets,” Dennehy says. “Our AI adviser ‘Sebastian’ provides personalised financial guidance for each user, and children can earn rewards by completing interactive lessons. For example, if they spend X number of hours learning on the app, they’ll get a voucher for the same amount of time for Disney Plus.”
NestiFi is not Dennehy’s first innovation rodeo. A graduate of the University of Galway, where he studied IT, Dennehy has been involved with multiple start-ups as founder/co-founder, including digital payments infrastructure company, Aid:Tech, which was the overall winner of The Irish Times Innovation Awards in 2018. NestiFi is his latest venture, and the company currently employs four people.
“I’ve spent the last decade building technology at the intersection of trust, transparency and financial inclusion, and it struck me that families have no modern tools with which to build wealth together because most investment apps are built for individuals, not families,” Dennehy says.
“I felt the time had come to replace siloed banking apps and old-school custodial accounts with a next-gen platform that would bring together traditional investing, blockchain assets and family-based financial literacy in one seamless experience,” he adds.
Dennehy says the company’s initial target market will be the US, where an $84 trillion (€75.5 trillion) intergenerational wealth transfer is already under way. Europe will follow, including Ireland, where Dennehy says a substantial wealth transfer will also take place over the next 20 years.
Families are a key market for NestiFi, but so are credit unions, financial advisers, financial institutions and fintechs interested in offering NestiFi as a value-added service to their clients. Investment in the business to date is running at about €250,000, and the company is currently raising a seed round of €1.5 million.
A private beta launch is slated for the third quarter, with a full roll-out in the US to follow later this year.
NestiFi’s revenue will come from transaction fees and signing up channel partners.
NestiFi is taking part in the AI Ecosystem Accelerator Programme run jointly by NovaUCD and CeADAR – Ireland’s centre for AI – while completing regulatory compliance in the US and guiding a pilot group of families through a test run of the app.
“The Tam (total addressable market) is huge, and while we face competition, I think we can differentiate ourselves through the ease of our user interface and the fact that this side of the market is underserved by technology,” Dennehy says.
The biggest challenge Dennehy has faced in setting up NestiFi has been navigating regulatory complexity while trying to move fast. “We’re building something that touches custody, tokenised assets and AI, all in a space where compliance really matters, especially when kids and families are involved. Trying to innovate responsibly without getting stuck in red tape has been the real balancing act,” he says.
As a serial entrepreneur, Dennehy knows his way around the start-up ecosystem. However, he says that clearer guidance and faster turnaround times within the grants system would make a massive difference to how fast a company can develop.
“Often, the paperwork is intense, and the decision timelines are too slow. If there were more founder-first grant supports with less admin and more mentorship built in, I think we’d see even more global-scale companies emerge from Ireland,” he says.
“Too often, start-ups are forced to chase funding instead of focusing on customers and product. There is a lot of goodwill and some excellent people in the ecosystem, but I think there’s still a gap between ambition and execution.
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“What I’d truly love to see would be a founder-led innovation hub, something agile with fast access to capital, technical expertise, and hands-on support for international expansion. We need to move away from treating grants as red-tape-heavy lifelines and instead use them as strategic fuel to help early-stage teams build, test and scale faster,” Dennehy says.
Are you aware of a recent innovation or innovator we should feature in this column? Email us at innovation@irishtimes.com
