ETF Edge - AI and redefining “active”? 8/10/26

Episode Date: August 10, 2026

Corgi, an insurance startup, is also trying to shake up the ETF industry. But does it all depend on what you, the investor, put a “premium” on?    Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The EETF Edge podcast is sponsored by InvescoQQQ. Let's rethink possibility. Investco Distributors, Inc. Welcome to ETF Edge, the podcast. If you're looking to learn the latest insights on all things, exchange-traded funds, you're in the right place. Every week we're bringing you compelling interviews, thoughtful market analysis, and breaking down what it all means for investors.

I'm your host, Dominic Q. The thematic AI trade is evolving, but not necessarily in the ways that you may think. Here is my conversation with Nico Lakwa, the CEO of Corgi, along with John Dobby, the founder, CEO, and CIO of Historia Investment Management. Thank you, gentlemen, both for being here with us right now. I love the fact that thematics are very much in focus because what it means is that the ETF business has evolved to the point where we can be a little bit more specific, a little bit more tailored about the way that we present investment products. So maybe I'll start with you first, Nico, in this conversation. Corgi made a lot of headlines over the course of this last few months with regard to the speed at which you've been able to bring

ETF product to market across a number of different themes or different types of investing. How exactly does a company in this day and age use technology, use the evolution of the business, to bring product like that to market? It used to take years to go through and get the investment approval done, the regulatory approval done, and now you can bring them to the market so quickly. How does that happen? Well, AI is really the big factor and the big technological shift

that's enabled us to do what we're doing. And I guess for context, by the end of the year, we expect to have more ETS issued than any other issuer. I think number two will be BlackRock at that point. And really our focus is on driving down costs, having the lowest fees, typically,

in whatever category we're in. We normally target about a third to half the expense ratio of most of, the other choices and offering investors, whether thus, institutional investors or retail investors, more choices at a lower price point. And the reason why we're able to do that is we're able to be much more compliant, we're able to file things much more quickly, we're able to operate significantly faster, we're able to come up with ideas faster, because AI really can plug into every single part of the operational business. I mean, filing ETFs and launching product is really

a words-based industry, and large language models are very good at using words. That's interesting because, I mean, John, you run ETF's product as well. How has your experience been with regard to kind of the work that you've had to do? You've been a little bit more traditional in the way that you've brought these things to market without the use, at least for right now, of many of those AI tools that Nico refers to. The lead time for you to bring your product to market, what does it kind of compare with what you're seeing happen right now in this business?

Well, I would say it's gotten quicker. I mean, obviously, Corgi has their own approach. They're trying to issue large amounts of ETFs. On our side, even though the time is short and considerably, we want to bring life products that we feel like we can use ourselves. So as an asset manager that serves as an OCIO, like if we can build a better mouse tribe, and we can because we're an active manager, we've got good quants at Astoria.

You know, we want to launch when we can can solve a need for ourselves. So we want to sort of bring assets to the table upon launch. And I do think that in talking to Corgi, like they do have some version of that, which I found interesting. So yeah, we want to launch products where we think there's a need, there's a vacancy, and we can build a better mousetrap. Nico, one of the other kind of dynamics at play here is the active versus passive. And that's been the same kind of dual bucket system that we've talked about the ETF business in for decades.

this point now. There hadn't been that many actives in the kind of beginning stages. It was much more index-based and passive. Now much of the growth in terms of number of funds coming to market is being driven by the active management component. How do you treat your funds at Corgi?

Are they kind of benchmark-based upon some of the indices that you develop? Or do you have, say, portfolio managers that are kind of making active management decisions about the types of stocks, the types of investments that go in and out your portfolios and funds. Yeah, so when we think about our portfolio, I guess, of ETFs,

even the actively managed ones that we have tend to rebalance around once a quarter along, you know, kind of guidelines that might look a lot like a traditional index fund. So I wouldn't call even our actively managed ETFs that active relatively. The way that I think about it is, and the reason why I think we're seeing a huge growth in the number of actively managed ETFs as opposed to index-based ones, is because from a time-to-market perspective, it's much faster to launch an active ETF

that maintains many of the qualities that a traditional passive one might launch. So in my judgment, kind of the distinction, in many ways, is blurring. Because if you look at some of the active ETFs, that even other issuers that aren't Korgi have launched, you know, recently, a very good number of them could just as well be done, be an index, by tracking an index.

John, one of the kind of points that Nico brings up that's interesting to me is the idea that you can have this kind of active, with passive component, this offering, if you will, but there's always going to be this kind of view that for an actively managed ETF, that there's a team of people or a group of people, portfolio managers, analysts who are kind of making these decisions to rebalance, whether they be quarterly, semi-annually, yearly, or even more frequently than that. But it also does kind of provide a different type of exposure than an index-based exposure. From your standpoint, these thematic type ETFs, are they better off as actively managed ones or developed by an underlying index or

a set of indices that are designed to then track those indices? How do you think that kind of dynamic plays out. Well, so like specifically right now, I'd say a lot of people trying to copy like DRAM and the success that that has brought. So it kind of reminds me of like HEDJ, DXJ in the 2010 period where WISNTree launched these currency edge ETS because like central banks were trying to weaken that currency. And so like there was hundreds of products that were launched after that. Some were active, some more passive. But really like DXJ and HDJ so sort of stole the show. So now what I find is like all these AI thematic ETFs that are being filed. It's from like I would say a lot of issuers that effectively at the end of the day to me they're like sales marketing companies. They're not

real active managers. And I just think if you're going to go specific in one area of like the market, you really need to be like a skilled active manager. So that'd be my advantage point. Like I do personally think there should be like an AI adopters ETF, right? An active manager that's going to say, okay, where within this labyrinth of AI is going to be the most beneficial. To us, that would be, like, the adopters, like, banks, insurance companies. It would be, like, parts of your merger market. It would be select industrials. So what I find is that, like, there's a lot of, like, thematic AI products being filed,

but, like, they're not going to give me really the exposure. I think benefits. So, bottom line for me, Dom, is that you've got to be an active manager that kind of, you know, can skillfully navigate the marketplace, not use an index. How, NICO, would you have a product offering like yours, kind of split between active funds and passive funds? Does that then mean that you have groups of employees dedicated towards the so-called active management, the research that goes into things, the quarterly or so rebalancing that these things go towards? And how exactly does that kind of differ from the teams that you have running and administering the passive products

when they're all under one roof, one house for these Korgia ETFs? Yeah, it's a great question. I mean, I think from our perspective, we're about offering investors' choice. Normally, even the names of our ETFs describe what the strategy is. And we tend to not, as a company, structurally endorse particular companies as opposed to others, you know, with regards to whether we think that they have a better approach or a worse approach. So even, like, if you look at most of our active ETFs, they tell you, you tend to be more or less market cap weighted. And that's because what we found in most back test reveal

is that a more passive-ish strategy tends to overperform. And that's kind of just our position. Like we do have teams of people that do trading, particularly on fixed income in other areas. And that team is growing quite a bit at Corgi. But as a company, I don't think that our job is to be a hedge fund or something like that, where we're you know, saying that company A's strategy is better than company B's.

You know, we tend to let the market do that by market cap waiting, by offering the lowest fees for all of our thematics. Really, that's our approach, to launch comparable products to very popular thematic ETFs, but a third to half the expense ratio. Okay, so the cost is a huge driver because it is something that does attract investors, by the way, because in this day and age, people look towards not just the tax efficiency as some of these ETF wrappers as a structure, but also, you know, most ETF investors will go right away and see, hey, what are the average annual returns for certain sets of periods,

and then they'll look at what the fee or the expense ratio is. So that's a big driver of it. When it comes to justification of some of those fees, John, it's also about having a manager who can identify where opportunities are that can justify the fees that they're doing, especially if it's a non-passive strategy, if one where you're paying somebody to out-performing, form a certain benchmark. Where exactly do you see some of those opportunities developing from your standpoint about the types of thematics that you would use to capitalize on things that you think are going to be the next hot topic in the markets? Well, I would say that parts, so we run a strategy called hedge growth, which basically, the basic premise is like, okay, if the S&P is up 20% a year,

we're going to, you know, sort of target, it's not guaranteed because it's not like an insurance product or buffer, but we want to sort of target like an 8 to 10% total return. If the S&P is down 20%, you know, we would hope and strive that this thing is going to be down, you know, 6, 7%. So within our model, we'll use like, you know, buffered ETFs. We'll use actively managed fixed income ETFs. Those are like, to me, like some areas that, you know, you need skillful managers, people that are going to sort of navigate fixed income.

To us, like the equity side of the picture is clean. generally speaking, like rotate away from Mag 7, Tilt International, buy value. But fixed income, you need an active manager that can pick and choose credits and, you know, make bets on like duration. So those areas, I would say, you know, buffered ETFs, actively managed fixed income, you know, or let's say like parts of emerged markets, you know, parts of, you know, select parts of like fixed income. You need active managers and you'd be willing to pay, we'd be willing to pay a management fee

if they perform well. But I sort of disagree with Nico said, like, to me, you should not buy passive ETFs because of low fees. Like, to me, that's why, you know, the MAG 7 is so big in S&P. It's like a self-fulfilling virtuous cycle because, like, S&P's issued at, like, three basis points. You know, people just keep buying it, and then it buys the same stocks. And it's like this, you know, definition of insanity, let's say. So there, I would rather, on the equity side, not go passive, pay a higher fee also. and have a manager that's going to tilt away.

Interesting because, so, Nico, the number of funds that you've brought to market, they are all very low fee on a relative basis to some of their peer funds and peer issuer companies out there. But when you take a look at the reason why people move into some of these funds, it is because they are trying to capitalize on, I guess, an iron-as-hot situation. They're trying to strike some point there. John had mentioned the DRAM, the Round Hill kind of memory ETF, it kind of was there at just this right moment when everybody was keying on a certain specific part of the market. When you bring product to market, how much of it is driven by your own internal research or your own internal kind of acts to grind about the types of funds you want to bring to market as opposed to what the investor demand is or where you think investors are willing to kind of put their money into certain types of funds.

or certain types of themes. I mean, honestly, most of it's our own internal conviction. You know, if we think something's cool, we'll launch it, whether it's very popular with investors or not. Because if we're launching the lowest fee version of something, we're very patient people. You know, we have infinite time to wait. And if we launch the lowest fee version of something,

sure, people can pay three times the fees to allocate their capital elsewhere. But over some long-time duration, I certainly believe that people will choose the low-fee versions. our buffers, for example. You know, like, I think market right now for everyone else is 79 to 85 basis points. We launched our buffers at like 30 basis points. You know, so sure, you could buy a buffered product at like, you know, multiples of the expense ratio, but I think you'd be a little silly to do that because a buffer is a buffer. It's the same product. And,

you know, that's kind of our position in general, that we view high fees as unjustified. You know, corgis are short dogs. We like short fees. But I think, dumb, like, what your vantage point is, two things. One is your insurance company, right? So your firm takes them premiums, right? You've got a long pathway for your ETF business to survive. And second is that they can allocate your own internal capital to your own ETS, right?

I mean, that's what's unique compared to, like, a new startup issuer that doesn't have, like, you know, reoccurring premiums that they're collecting that they can allocate. They're trying to find new people, right? And that's why I think Corgi is probably the biggest success story of the year and the most unique, right? So in response to that, how do you navigate at Astoria a kind of market where there are different types of players with different runways and different types of vantage points or horizons? And does it change at all, the competitive dynamic from your mind about how you have to approach investors? is it just about still returns and fees, or do you find some other value proposition

that kind of makes certain firms stand out over others in terms of not just garnering assets, but then keeping them over the longer term? Well, so I'll give an example. One is, so again, we were worried about the MAG 7, like two years ago. We thought that it was crowded, expensive, vulnerable valuations, high, and we wanted to sort of tilt away. So we weren't ready to buy value.

We didn't necessarily want to go to, like, you know, international markets, let's say. So we looked at like the S&P equal weight ETF or the Russell 1000 and those are like effectively like value small cap plays and they're 15% tech. So we launch ROE which is our own equal weight ETF that we are sector neutral versus S&P. So if you look historically like Rowe versus let's say like RSP the equal weight or you know EQAL which is the Russell one equal weight you know

there's like dramatic outperformance right there's like 30 percent of performance. So we would say as a skilled active manager, strong performance, you know, comparable fees, we would hope that investors would, you know, sort of like be aligned with us. And, you know, they are starting to. Our fund is, you know, crossed, you know, 250 million. It's got four stars by a morning star. But, you know, we're not corgi, right? We're not going to launch a thousand ETFs. Like, we're going to launch ETFs that we have an internal use for on our side. And, you know, we want to sort of partner with the right advisors that sort of see our vision and would, you know, participate with us.

Speaking of internal use, Corgi has an internal use for some of these ETF products. It is one of the big reasons why you are in this ETF business or one of the catalyst behind you devoting capital towards developing ETF business. Can you take us through what exactly Corgi as the parent kind of insurance type company is and why ETFs are a, I guess, attractive business for you to even be involved in? Yeah, so at Corgi, our mission is to make insurance faster, make it better, make it cheaper, to waste less of people's time and to protect people when something goes wrong, to basically make insurance infrastructure by using AI better.

And we're pretty diversified across a variety of market segments, but we're best known for insurance for technology companies' business. And there were very fast-growing, I mean, relatively about 99% of our business. revenue right now comes from our insurance business so it's doing very well as an insurance company float is very important and is very important to put that in fixed income ets on the surplus side typically people will invest some amount into equities thematics are very common buffers are very common this downside protection is important and when we were looking at the amount of capital that that we were going to have to allocate to reserves

about a little under a year ago, and we forward projected it. It was in the hundreds of millions of dollars, and we looked at the fees that we would have been paying ourselves if we were just buying what was on the market. For example, if we were buying buffers, if we were buying some of the fixed-income products

that are applicable for insurance. And we thought that those expense ratios were very, very high, and that we weren't getting serviced by buying what was on the open market that would have matched what we would expect for the amount of money that we'd be paying. So originally we put one guy and one intern on figuring out how to file

ETFs. We launched two starting in late December, early January, I think. And since then, it's become a real and rigorous operation where much like our insurance business, our mission is to make insurance faster, better, cheaper. We want to do the exact same thing on asset management. And maybe we're not going to be necessarily competing with active managers that are providing more premium service or advising you on where to allocate your capital. Our mission is rather to just lower fees across the board, essentially re-rate the fee structure for the entire ETF industry, which actually could benefit active managers, because many managers might choose to allocate capital to our ETFs as part of their strategy for their clients.

And in general, we'd really like to repeat the same thing that we've done in insurance to the ETF space in general and to broader financial infrastructure products. and we feel pretty confident that we're going to be able to do that on it and we're very patient. You know, on insurance, you know, now I guess we're relatively well known, but for the first two years of our company, we didn't have a website. We had to raise over $100 million pre-revenue in order to get our insurance products off the ground.

And, you know, on the ETF side of things, we haven't even officially launched that yet. We've been out under a year, but already by the end of the year, I feel pretty confident that we're going to have more ETFs than the next largest issuer, more than anyone else. And I think that, you know, if you look at our rate of growth, right now we're just shy of a billion in an AUM, but every couple of months, that's tended to double. And I think that we'll keep that up just by offering good products, by giving investors a lot of choices at the low, typically the lowest fees in whatever category that we care about.

All right. So we're going to delve more into that later on in that story for the podcast. But, John, I'm going to give you the last word to you here. You mentioned a number of different opportunities that you're looking at right now. As you look at the way that the ETF business is evolving and has evolved over the course of the past, say, like three or five years, since kind of like the depths of the pandemic, that we kind of normalize things. Where exactly do you think kind of that this fund management business is going to gravitate a little bit more towards? Is it a pendulum that has gone from passive to active and maybe swings a little bit back towards the passive side of things eventually? or do you feel as though this real thematic and active push

is something that it really is going to be the primary driver of the ETF business, not just an AUN, but also issues over the course of the next, say, three to five years? So I'll give you a couple different answers. One is that I do think that the filing process has gotten quicker, so Nico talked about that. Two, I think, I mean, we're living through historic periods of how crowded and concentrated the S&P is, so seven stocks make up 40%. If you go back 100 years, we're at 100 years.

We're at 100 year-wide, right? So it is a time for active managers. It makes sense to tilt away. So the market really started rotating, like, last summer. And so since last summer, you are seeing, you know, value-centric strategies outperforming, and active managers are doing better. They just don't do well in, like, the S&P 500. So everyone obsesses over, like, the Speaver report.

But that is, you know, large-cap U.S. equities, which is a highly efficient market. If you start going to other areas, mid-cap, small-cap, active-fix-income, emerging markets overseas, you do see active managers outperforming. I can tell you that a story. Like we are having an exceptionally banner year in terms of like how we're doing versus our benchmark. And so there's a couple of reasons for that. One is that idiosyncratic risk is high. Dispersion is high. So when you have a lot more volatility, you can have more time for alpha, right? So we're seeing that on our quantitative active equity suite. And then just, you know, it is a very strong U.S. economy, right? So yields are rising, you know, manufacturing data strong.

We're living through like an earnings bonanza, right? If you look at earnings growth. So if you can't outperform as an active manager now, you will never. So I just think they have a little bit of runway like this year and next year. And so let's see if they deliver it. But index and passive is crowded. You know, NECO's firms trying to, you know, compete. And that's a tough place to compete.

So we're trying to like compete in like the active space where we feel like, and we are competing and having strong results versus our peers. All right, we'll have to revisit this conversation, X months or quarters down the line to see whether or not that story is played out. Now it's time to round out the conversation with some thoughtful analysis and perspective to help you better understand ETS with our Markets 102 portion of the podcast. Nico Lackwa, CEO of Korgi, continues with us now. Nico, thank you so much for sticking around for the podcast.

the conversation, I mean, it triggered, I don't know, two, three dozen at least questions that I had follow-up-wise. And we obviously don't have the time to go through all of them. But I'd like to spend some time here with the podcast going through some of the kind of interesting points of Corgi's business. And why exactly an insurance company that's built on the premise of AI efficiencies wants to get into the ETF business. You had mentioned it during the show that it's a way for you to invest that kind of money that you get from your insurance business to kind of further things out in terms of your returns on a longer term basis. But can you take us through a little bit of the detail and nuance behind Corgi's start and why it's evolution towards wanting to be in the ETF business? Yeah, so when Corgi began, we didn't really have a strong thesis around what was broken in an investment. I think if you talk to anyone who's dealt with insurance for more than two seconds, they'll probably have plenty of negative things to say.

But it wasn't intuitive actually what was causing those sort of problems. And what we learned over time is that the more kind of regulated you get, we call it the regulatory bare metal. The closer to the regulatory bare metal you get, the worst experience tends to be. And that that kind of causes issues that result in poor product experience for the end customer. So it became our mission to become the most regulated kind of parts of insurance. We call that an insurance infrastructure company. And although we're best known for our product suite in which we sell insurance to technology startups, we're pretty diversified.

We're active in real estate. We're active in trucking. We're expanding into sports and entertainment. We also handle claims for around 50 other insurance companies. So we're increasingly diversified on the insurance front. But a consistent theme is that the more kind of regulated it is, the more interested we are in kind of inhabiting that niche. As an insurance infrastructure provider, the concept of reserves, of float, of surplus, those are very, very important. And particularly fixed income for flow or anything handling customer funds is really important.

But on the surplus side, areas like buffers, broad equity. ETS, thematics, those are all very relevant. And when we were looking at deploying our capital, much like pretty much every single insurance company or insurance infrastructure company does, what we found is that across the board, fees were very high for kind of passive-ish-fueling products. And the experience that the fund issuers were providing

didn't really justify the high fees. Like I'll use buffers, for example. You're looking at 80, 85 basis points as a normal fee ratio, and we launched our bus. offers with 30 basis points as our fee. And we realized pretty quickly that our skill set of using AI to do a lot of regulatory work, to do a lot of compliance work, to do a lot of filing work, would carry over really, really nicely to asset management.

Originally, we launched two ETFs that kind of represented something that we thought might be interesting to us. But we realized pretty quickly that because our time horizon is essentially infinite, and because we have, you know, really asymmetric upside when we launched these, these ETFs with cap downside, that is an area where we want to, you know, place our flag in the sand, and we just have longer time horizons than everyone else. So kind of our position is that if we go into any kind of market sector that we think is interesting, and if we launch products that typically have a third to half the expense ratio of everyone else, that that offers more choices to

investors and over a long time duration, you know, funds will flow in our direction. Because although you could buy something at like three times the price essentially, you know, I think eventually funds will flow in our way. So that kind of became our main thesis. And of course, we do some splashy things to kind of make a name for ourselves. Like we set the record for launching the most ETS in a day and then broke our own record. I think by the end of the year we'll probably have more ETFs than the next largest issuer. and that's because we can use technology and bring everything in-house in order to offer

lower expense ratios in order to be more compliant or to file more than everyone else. But beyond that, I view the asset management space in general as being very similar to insurance before we went into it in the sense that there's unjustified fees, there's friction on product development because people haven't really brought as much in-house as they could have. there aren't that many vertically integrated players.

And we intend to repeat the exact same thing that we did in insurance to the ETF space. So this is the fascinating part to me. It sounds like, and please correct me if I'm wrong, because that's the point of this conversation. You got into the ETF business because you saw a need from your own insurance operations to invest your float, the premiums that are going to get taken and everything else, right, into products that you thought were charging too much in fees. So you said, I can do this on our own more efficiently with less fees and mimic the similar or same types of results.

So your ETF business entry was because you found a need on your insurance business to find an asset management type operation that could do better. And then you basically open that up to other people, retail or RIAs or otherwise, to invest alongside the insurance. business. And we realize that there's huge, like, you know, as an insurance company, we're not going to invest in single stock levered ETFs. But we realized, for example, that that's an area where the fees are just like astronomical for really no reason. So we launched, I don't know how many of those. And obviously, it's not a fit for our business, but that is a fit for a certain type of

investor that has an opinion on where the market is going. And it's our position that, you know, high fees are just something that frustrates us. We don't think that that's warranted. And we think that we're better at new product development, at regulatory filings, at compliance, than most of the legacy players are. And the reason why is because we can use technology and we can automate a lot and we can be very, very efficient. And that's precisely what we did in insurance. And I think that, you know, particularly within the world of finance, it's pretty easy for people to underestimate the impact of growth. So, you know, I'll talk about, you know, our ETF business, you know, we're just shy of a billion in AUM is still small, but every,

you know, two, three months, historically, you know, our AUM has doubled. That's because we offer good products. We don't do much, if any, marketing. We don't spend hardly anything on sales. Rather, we just launch good products that give investors choices. And, and, you know, sure, like right now it's about 1% of our revenue maybe, our ETF business. But, you know, something that's doubling every two, three months, as long as you keep up the level of innovation, that can grow very large, very quickly. And we saw that on insurance. You know, first, other insurers laughed at us.

And, you know, maybe some of them still do. But I think that number of people that are laughing at us is shrinking day in and day out because our growth there has been really enormous. And it's been enormous because everyone hates the current product offerings. We can do it better on both getting a policy. We don't waste your time. We have very transparent pricing. We have a better experience across all the industries we're in,

as well as on the claim side. We can process claims much faster, which is why legacy players have actually come to us in many cases and said, hey, can you handle my claims? And I think ETFs are kind of in a similar spot where someone who's rebalancing a couple of thematic market weight index of stocks, whether it's active or passive, doesn't really matter. that doesn't justify 80 basis points of fees.

It just doesn't. That's not what it costs on the back end if you actually bring things in-house. That's not value that's being delivered to the end customer. That's charging something very high prices and creating market inefficiencies because there's regulatory friction and a regulatory barrier to entry. And as a company, we exist to do AI financial infrastructure, which means that we want to eliminate and make more efficient those areas in which there's market and efficiencies by offering good products at fair prices, you know, to end customers.

And what we found is that when we offer the best price point, the best experience, the best regulatory footing and infrastructure by using technology to end customers, that's something that, you know, eventually over some long time duration wins. During the course of the online show prior to this podcast, you had mentioned, and I had a ask the question about, you know, how you bring product to market. What exactly is the kind of research or market kind of assessment that you do to bring like one or two or three of the 34 that you dropped in a day or the 36 that you dropped at a day? A lot of it is based upon the needs that you guys have or the desires from an insurance company standpoint for how you

invest the money. And you also mentioned the number of levered ETFs that you, you bring to market, not something you use for the insurance business, but something that you identified as being of desire to the end customer that you have as perhaps a retail investor or anybody else. How exactly does that process work on your end with regard to the, I guess, study that you do when it comes to, hey, what's the next product we're going to bring to market? I mean, obviously, AI helps with that, but you know the Eye of Sauron and Lord of the Rings? I do. Yeah, so like, you know, it looks. looks in kind of one direction.

Oh, sometimes. Sometimes it scans, right? Yeah, it scans, but it'll kind of eventually fixate. And, like, you know, maybe there's things wrong in other areas, but wherever Sauron's looking, that's where the real action is. You know, I think it's kind of like that. Like, if we find a sector that we think has, like, appalling fees or just not good products or where we think we could be innovative, we'll just pay a lot of attention to that sector. And I think launch, in my opinion, better products.

but it's up for people to choose. But we'll do that and we'll leave no stones unturned. We'll try to make a splash there. And then once the products are out, they're out. And if you notice, we haven't closed a single ETF. You know, I don't imagine we will and I don't know why we would. Because if we're offering essentially the same thing at a lower cost to end investors, I think, you know, my opinion, that's not only, you know,

some semblance of a social good, but it's certainly a business good. You know, you don't want to pay fees for no reason just for the sake of paying fees. So that's kind of our main approach. And obviously there's a lot of areas too where we might first to market in a particular category. Like we had the first photonics ETF on the market, which is where, you know, just probably, I don't know the exact number, maybe around half of our AUM comes from that. So there's certain areas where we might be first to, you know, kind of an area, and we might be innovating in that way.

But beyond that, I mean, where the vast majority of the number of funds we have are just areas where we think that the current fee structures are unjustified and where, you know, we're very convinced that we can launch analogous products at a fraction of the cost. Now, another point I think I want to get to before we kind of let you go here, you guys just, and when I say you guys, I mean, Corgi, has just gone through just in the last few months or so a series B funding round. B, that's not deep. That's kind of early stage, you know, for the most part, but you're still valued at the time at roughly just over $2.6 billion in terms of your total business. When you look at the way that this business is evolving for Corgi, the insurance side is obviously the massive driver and the massive kind of revenue center and the massive operation that it is that encompasses most of Corgi's operations.

But the ETF business is something that you found desirable to be. and because of the dynamics you just spoke of, when you look ahead, and for as much clarity as you have as the CEO of an insurance AI company, what exactly is your kind of vision for how that insurance company develops in context with or in relation to the ETF business, how much do you want to see that grow

in terms of maybe product mix between the two components, insurance and asset management, say in five years from now, or seven years from now or 10 years from now, hypothetically. I view them pretty separately at this point in the sense that, like, as a company, our focus is on areas of financial services, financial infrastructure, where we're convinced that large language models or AI or technology in general can make things faster, can make them better,

can lower prices, can deliver value. And, you know, frankly, we stumbled into ETS as an area where I'm very convinced that's the case. and, you know, that's that. And if it's there, I'm not really interested in being second place or third place or fifth place or tenth place in a category. We want to be, you know, I saw a video the other day of like a bear hunting, a deer where it kind of like bit into it and like tore it apart. That's what we want to be in any category where we enter. We want to be the most aggressive.

We want to be the most ambitious. And we want to deliver the best products at the lowest price point to end customers while still having a very viable business. and you know I think I'm quite confident that our ETF business you know will be that and you know broadly speaking our vision with Corgi is just anything that's very regulated and financial in nature where like technology can be a game changer and can result in us doing it better and we're convinced that we can do it better you know you best expect to find us there and that extends far beyond insurance that extends far beyond asset management you know if we stumble into something and we think that it shouldn't work the way it works right now now and it frustrates us, we're not just going to leave that stone unturned. We're going to compete in the market. We're going to do the hard regulatory work to actually become these kind of regulated financial entity types, which is something that most tech companies probably don't want to do, but the more regulated it is, the more attractive it is to us. And once we do decide to go into an area and plant our flag, we're not going to surrender because we're going to keep offering good

products at good prices with good features, you know, features for, customers. We'll save them time. We'll save them money. We'll maybe do both. We'll protect them if something goes wrong. All the things that the financial economy does well, we'll do it better and we'll do it better with AI. And so, you know, I view it as pretty separate at this point where sure it's the bet we're making, but I think once we've planted our flag in an area, we're not going to surrender. We're going to keep doing it until we win, and we will win. All right. That's a fascinating conversation. Please, again, come back and see us. again soon and give us the updates because we'd love to hear about what you guys got to

thank you very much nico lacoa yeah thanks for having me the CEO of corgi that does it for the et fedge podcast thanks for listening join us again next week or just head over to etfedge dot cnbcc dot com over the last few decades technology has transformed our world in amazing ways through it all investco qqqq etif has connected investors to the forefront of innovation access the future today with InVesco QQQ. Let's rethink possibility. There are risks when investing in ETFs, including possible loss of money. ETF risks are similar to those of stocks. Investments in the tech sector are subject to greater risk and more volatility than more diversified investments. The NASDAQ 100 index includes the 100 largest non-financial companies listed on the NASDAQ. An investment cannot be made directly

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