StartupTalky

Tag: mutual funds

  • Dropping Out to Cashing In: Remarkable Rise of Nikhil Kamath to India’s Youngest Billionaire

    Is it just me, or is skipping school or the college exit door like a secret handshake to the world of success and stardom? There are so many dropouts-turned-superstars out there that it’s starting to seem like an underground club, where the membership fee is ditching the classroom.

    On a lighter note, we usually encounter successful people who don’t hold a proper or suitable college degree. But such people have created a history that stands as a testimony to their intellect for all the future.

    In this article, we explore the journey of one such person, who dropped out of school to later found India’s largest stockbroker – Zerodha. We will explore the success story of Nikhil Kamath, early life, his education, personal life, career, investments, and much more.

    Nikhil Kamath Biography

    Name Nikhil Kamath
    Birthplace Shimoga, Karnataka
    Date of Birth September 5, 1986
    Nationality Indian
    Education School dropout
    Position Co-founder and CFO
    Net worth $3 billion (January 2025)

    Nikhil Kamath – Early Life & Education
    Nikhil Kamath – Career
    Nikhil Kamath – Entering the Trading World
    Nikhil Kamath – Personal life
    Nikhil Kamath – Podcast
    Nikhil Kamath – Zerodha
    Nikhil Kamath – WTFund
    Nikhil Kamath – Personal Investments
    Nikhil Kamath – Partner Investments
    Nikhil Kamath – Philanthropy
    Nikhil Kamath – Controversies
    Nikhil Kamath – Awards & Recognitions

    Nikhil Kamath – Early Life & Education

    Nikhil Kamath was born in Karnataka, India, in 1986. Since his dad was a bank employee, he often got transfers. Nikhil was 9 years old when they finally settled in Bangalore.

    Though Nikhil displayed a strong aptitude for mathematics and problem-solving from a young age, he hated the traditional way of taking formal school education. In Bangalore, he attended a local school. Since the school didn’t let him appear for the 10th board exams citing his disinterest in studies as a reason, he decided to drop out of school. Thus, Nikhil didn’t have a formal mode of education after that.

    Nikhil Kamath – Career

    After dropping out of school in 10th grade, which was a huge decision, Nikhil Kamath’s journey to success was a remarkable tale of determination and resourcefulness.

    After leaving school without a clear plan, he found himself working at a call center at the age of 17. To make ends meet, he even faked his birth certificate to land the job, which paid him a meager salary of INR 8,000.

    Zerodha Success Story – The Largest Stock Broker in India
    Zerodha is an Indian financial services company founded by Nithin and Nikhil Kamath in 2010. Check out Zerodha’s business model, revenue, profit, and more.
    StartupTalkyAnik Banerjee

    Nikhil Kamath – Entering the Trading World

    During those challenging times, he labored at the call center from 4 PM to 1 AM, and in the mornings, he delved into the world of trading. Nikhil learned the ropes of life outside his family’s protective cocoon, and he discovered that it was in the outside world where the real lessons were learned.

    Around the age of 18, Nikhil decided to venture into stock trading more seriously. His father entrusted him with some of his savings. This leap of faith from his father marked the beginning of Nikhil’s journey as a trader. He not only managed his father’s money successfully but also convinced his manager at the call center to invest in stocks.

    It turned out to be a fruitful endeavor, and soon, others followed suit, allowing Nikhil to manage their funds. In his final year at the call center, he cleverly managed the entire team’s money, which meant he didn’t have to go to work physically, yet he received incentives.

    Zerodha’s Inception

    Nikhil’s ambition eventually led him to leave his job and team up with his older brother Nithin Kamath, to launch Kamath Associates in 2010, which later evolved into the highly successful brokerage firm, Zerodha. His journey from a call center employee to a prominent figure in the financial world is a testament to his resourcefulness and dedication.

    Nikhil Kamath – Personal life

    Nikhil Kamath resides in the city of Bangalore, India. His parents are U.R. Kamath, an employee of Canara Bank, and Revathi Kamath. He was married to Amanda Puravankara who was the director of Provident Housing Ltd., Bangalore. The couple reportedly separated within a year of their marriage. Kamath is an avid reader and a chess player.

    Nithin Kamath Biography: Education | Family | Zerodha | Net Worth
    Nithin Kamath is a Co-founder of the brokerage company Zerodha and Rainmatter. Know about Nithin Kamath’s education, family, children, success story, net worth, etc. Learn more about him on Nithin Kamath Wikipedia.
    StartupTalkyMegha Rani

    Nikhil Kamath – Podcast

    Nikhil Kamath also hosts a podcast series “WTF is”, in which he interviews industry leaders and close friends in light-hearted but thought-provoking conversations. The program discusses various subjects including technology, social media, alternative energy, and more.

    Prime Minister Narendra Modi made his podcast debut with Nikhil Kamath on 10 January 2025. The two-hour episode, titled “People with The Prime Minister Shri Narendra Modi x Nikhil Kamath,” is part of Kamath’s “WTF is” podcast series.

    The conversation explored various topics, including PM Modi’s childhood, similarities between politics and entrepreneurship, essential skills for entering politics, governance, and global affairs.

    People with The Prime Minister Shri Narendra Modi x Nikhil Kamath

    Nikhil Kamath – Zerodha

    Zerodha Website
    Zerodha Website

    Zerodha, a game-changing player in India’s trading and investment scene, commenced its operations on August 15, 2010, with a clear-cut mission: to remove the hurdles that traders and investors often faced, especially in terms of cost, support, and technology. The company’s name, “Zerodha,” cleverly combines “Zero” with “Rodha,” a Sanskrit word meaning barrier, to reflect their commitment to this vision.

    Today, Zerodha proudly stands as one of India’s largest stockbrokers, thanks to its innovative pricing models and cutting-edge technology developed in-house.

    They boast a massive client base of over 1 crore, managing millions of orders daily through their user-friendly investment platforms. Their influence is felt in the trading world, accounting for a significant 15% of all retail trading volumes in India.

    Another creation of Kamath, True Beacon is a fee-free investment management company that targets investors with extremely high net worths.

    Also, Rainmatter is their venture capital fund and incubator that invests in fintech companies and ventures that promote financial inclusion.

    Nikhil Kamath – WTFund

    Nikhil Kamath introduced the ‘Innovators Under 25‘ at the most recent WTFund Summit in Mumbai. An inaugural event was held in September 2024, to celebrate the establishment of WTFund, the first non-equity grant fund in India, to support innovation among entrepreneurs under the age of 25. It was a pivotal event for India’s startup ecosystem, showcasing the next generation of innovators ready to shape the country’s future.

    The role of young entrepreneurs in creating India’s future was highlighted by Kamath. Anyone, from 25 to 80 years old, may be an entrepreneur and create the next great product. “But, come on, the enthusiasm, determination, and boldness usually come more naturally when you’re younger,” Kamath said.

    To support nine startups now and nine thousand young businesses tomorrow, Kamath said, “We’re dedicated to building an India that isn’t afraid to take risks and step outside our comfort zones.” He went on to say that he hopes to aid thousands of startups in the future. Whoever decides to build their own aspirations instead of helping someone else realize theirs will lead India in the coming decade. The diversity of India’s innovation landscape is on full display among the fifteen grantees.

    Zerodha Co-founder Nikhil Kamath Launches ‘Innovators Under 25’
    Zerodha co-founder Nikhil Kamath introduced the ‘Innovators Under 25’ at the most recent WTFund Summit in Mumbai.
    StartupTalkyNitin Konde

    Nikhil Kamath – Personal Investments

    Kamath has recently revealed in his podcast about his investment of INR 400 crore in Radico Khaitan for a 1.6-1.7% stake. Additionally, Nikhil has made some significant personal investments:

    Announced Date Organization Name Lead Investor Funding Round Money Raised
    September 11, 2023 Pee Safe – Series B ₹250 million
    June 26, 2023 Mainstreet – Seed Round ₹2 million
    January 31, 2023 Nourish You – Seed Round ₹163.7 million
    July 26, 2022 Nas Company – Venture Round ₹12 million
    March 15, 2022 Licious – Series F ₹11.5 billion
    February 8, 2022 Kofluence Yes Seed Round ₹4 million
    January 27, 2022 Growth School – Seed Round ₹375 million
    April 1, 2021 Third Wave Coffee Yes Seed Round –
    March 17, 2021 Vokal – Secondary Market –

    Nikhil Kamath – Partner Investments

    In addition to his personal investments, Nikhil has also made investments as a partner:

    Announced Date Organization Name Investor Name Lead Investor Funding Round Money Raised
    October 13, 2023 Emoha Elder Care Gruhas Proptech Yes Series B $11 million
    April 5, 2023 Ossus Biorenewables Gruhas Proptech Yes Seed Round ₹197 million
    March 15, 2023 Spirit Media Gruhas Proptech Yes Venture Round –
    February 25, 2022 Licious Gruhas Proptech Yes Series F ₹91.4 million
    February 17, 2022 Omnipresent Robot Technologies Gruhas Proptech Yes Venture Round –

    Nikhil Kamath – Philanthropy

    Nikhil is also known for his philanthropy:

    • Nikhil Kamath recently joined the list of wealthy people around the world who have signed the Giving Pledge & pledged to donate 50% of their money to philanthropic causes. Notably, Kamath is the youngest Indian philanthropist to join the Giving Pledge.
    • Kamath also launched the Young India Philanthropic Pledge (YIPP), which mandates the signatories who are below 45 years of age to donate 25% of their fortune with a minimum spend of ₹1 crore per year.
    • According to the EdelGive-Hurun India Philanthropy List 2022, Kamath donated ₹100 crore of his wealth in 2022, along with his brother and co-founder of Zerodha, Nithin Kamath.

    Nikhil Kamath – Controversies

    Nikhil Kamath competed in a charity chess match against Viswanathan Anand, a five-time world chess champion. He won the match, much to the amazement of everyone. However, the multibillionaire eventually apologized for beating the chess champion unfairly and acknowledged doing so.

    He tweeted, “I had help from the people analyzing the game, computers, and the graciousness of Anand sir himself to treat the game as a learning experience. This was for fun and charity. In hindsight, it was quite silly as I didn’t realize all the confusion that can get caused due to this. Apologies.”

    Nikhil Kamath – Awards & Recognitions

    Here are some prominent awards and recognitions for Nikhil Kamath:

    • He was among the Forbes India ‘30 under 30’ young entrepreneurs, in 2016
    • He was listed as the richest self-made Indian under 40 by ‘IIFL Wealth Hurun India 40 & Under Self-Made Rich List 2022’
    • He made it into Forbes’ list of the world’s billionaires in 2023
    • The Hurun India Report 2024 ranks Nithin and Nikhil Kamath 8th among self-made entrepreneurs for Zerodha, valued at Rs 64,800 crore.

    FAQs

    Who is Nikhil Kamath?

    Nikhil Kamath is the founder and CFO of Zerodha, which is an online trading service provider company.

    Where is Nikhil Kamath birthplace?

    Nikhil Kamath was born on September 5, 1986, in Shimoga, Karnataka.

    Who are Nikhil Kamath parents?

    Nithin was born in Shivamogga, Karnataka, India, to a Konkani family. His father, Late U.R. Kamath, was employed as one of the executives of Canara Bank. His mother, Revathi Kamath, taught him to play the musical instrument, the veena.

    When was Nikhil Kamath born?

    Nikhil Kamath was born on September 5, 1986. His age is 39 years.

    Who are the founders of Zerodha?

    Nikhil Kamath and Nithin Kamath co-founded Zerodha.

    Where did Nikhil Kamath study?

    Nikhil Kamath did not follow a traditional education path. He dropped out of school after completing the 10th grade to pursue his interests in chess, stock trading, and entrepreneurship.

    What is Nikhil Kamath net worth?

    The net worth of Nikhil Kamath is $3 billion (January 2025).

    What is Nikhil Kamath education?

    Since the school in Bangalore, didn’t let him appear for the 10th board exams citing his disinterest in studies as a reason, he decided to drop out of school.

    How Nikhil Kamath became billionaire?

    Nikhil Kamath became a billionaire by co-founding Zerodha, India’s largest discount brokerage, which revolutionized stock trading with its low-cost, user-friendly platform. His success was driven by his expertise in stock trading, strategic thinking, and focus on simplifying investments for retail investors.

  • BlackRock and Jio Finance Jointly Invest INR 117 Cr in Mutual Funds

    Following the revelation that the company and its joint venture partner, US-based BlackRock, have invested INR 117 crore in their mutual fund business, Jio Financial Services (JFSL) will continue to be the focus of attention on January 22. BlackRock and JFSL have each purchased 5.85 crore equity shares in Jio BlackRock Asset Management Private Limited, a 50:50 joint venture between the two companies, at a price of INR 10. According to a regulatory filing, this transaction is worth INR 117 crore in total.

    In order to obtain approval, Jio BlackRock Asset Management Private Ltd applied to SEBI. An initial investment of INR 82.5 crore each was made in this company by JFSL and BlackRock. ‘Jio BlackRock Broking Private Limited’ is a wholly owned subsidiary of Jio BlackRock Investment Advisers Private Ltd, a joint venture company of the company, which was established on January 20, 2025, to conduct broking activities subject to regulatory approvals.

    Performance of Jio Financial Services in Q3

    For the quarter ending December 31, 2024, Jio Financial Services reported a consolidated net profit of INR 295 crore, which was unchanged from the INR 294 crore reported during the same period last year. In the third quarter of FY25, the Mukesh Ambani-backed company reported total sales of INR 438 crore, a 6% increase over the INR 414 crore reported in the same quarter of the previous fiscal year. As of December 31, 2024, the assets under management (AUM) were INR 4,199 crore, up from INR 1,206 crore in the second quarter of FY25.

    Developments at Jio BlackRock Asset Management Company

    The developments occur at a time when JFS has intensified its fintech strategy. George Heber Joseph was named the first chief investment officer of Jio BlackRock Asset Management Company in December of last year. Additionally, rumours circulated earlier this year that BlackRock and JFS were negotiating the creation of a private lending partnership. By utilising technology, Reliance Jio’s extensive client base, and BlackRock’s experience in the financial services industry, JFS intends to upend the nation’s fintech industry by providing services like digital lending, banking, and insurance, among others.

    India’s Fintech Ecosystem Leading the Global Race

    In spite of this downturn, the Indian fintech ecosystem is one of the top three globally financed fintech ecosystems in H1 2024, after the US and the UK. According to Tracxn’s Geo Semi Annual Fintech India Report for H1 2024, the ongoing funding winter and a number of other geopolitical challenges are to blame for the funding fall. Compared to one in H2 2023, two funding rounds totalling more than $100 million were observed during that time. These include the $120 million Series C funding round raised by lending platform Avanse and the $144 million Series D funding round raised by non-banking lender Credit Saison.

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  • Nivesh, a Wealth Tech Platform, Buys Wealthzi

    Wealthzi, a wealth platform run by Lime Internet Private Limited, has been acquired by wealth tech platform Nivesh. This is a significant step for the business in achieving its objective of becoming a 360 degree platform that handles all of its clients’ investment and insurance-related demands.

    Anurag Garg and Sridhar Srinivasan created Nivesh in 2016, which uses AI-driven technologies and support to improve client results. It has 60,000 customers in 6,000 Indian cities and is supported by LetsVenture, IAN Fund, and prominent figures in the sector like Rahul Gupta, Dipak Gupta, and Basab Pradhan.

    What is Wealthzi?

    In 2020, Pradeep Pillai, a seasoned wealth management expert who has worked with companies like Reliance Wealth, Karvy Private Wealth, Ameriprise, and Deutsche Bank, and PV Sahad, the former founder of VCCircle, created Wealthzi. The Wealthzi team has managed substantial assets for family offices, UHNIs, and HNIs for more than 20 years.

    Mutual funds, PMS, AIF, bonds, and other assets totalling more than INR 500 crore are currently under its management. In order to expand its operations and offer advisory services, it just received an RIA license from SEBI. The team will be able to use the Nivesh technology’s platform to improve user experience and expand its business thanks to the integration. Additionally, the purchase will allow the two companies to gain from product, research, and operational synergies. In the next three years, the combined company’s assets are expected to exceed INR 10,000 crore, with an AUM of INR 2,500 crore.

    Benefits of This Acquisition

    Speaking about the advantages of this transaction, PV Sahad stated that the Wealthzi team is thrilled to work with Nivesh, a leader in B2B2C financial offerings. By combining Nivesh’s distribution network with Wealthzi’s direct-to-consumer wealth service, a strong financial partnership will be formed to serve India’s rapidly expanding investor base.

    Speaking about the purchase, Nivesh founder and CEO Anurag Garg stated that the company is extremely pleased to have acquired Wealthzi, which would allow it to broaden its product line and target the Affluent and HNI categories, which present enormous opportunities for wealth management. The company anticipates growing quickly and becoming a major force in the sector.

    As the growth of stock markets and wealth creation creates new prospects for wealthtech businesses, this acquisition coincides with increased investment in India’s wealth management industry.

    Citing statistics from the market intelligence platform Tracxn, a prominent media outlet reported on August 19 that during the last two years, investors have invested over $228 million in Indian wealthtech businesses. Consolidation is also occurring in the industry, as seen by an increase in mergers and acquisitions (M&A).

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  • INR 5,085 Crore is Raised by Swiggy from Anchor Investors

    More than 75 anchor investors have contributed about INR 5,085 crore (about $600 million) to Swiggy, one of the top food and grocery delivery services in India. The Bengaluru-based business, which rivals Zomato, which is run by Deepinder Goyal, revealed the investment in a stock exchange filing on 5 November 2024.

    Specifications of the IPO: Scale and Composition

    The INR 11,327.43 crore Swiggy IPO consists of a primary issuance as well as a secondary offering by current shareholders. The secondary offering, also known as the Offer for Sale (OFS), is worth INR 6,828 crore, while the primary issue, or fresh money raise, is worth INR 4,499 crore.

    Second only to Zomato’s public debut in 2021, this IPO is anticipated to be among the biggest in India this year and among the largest in the food technology sector. Swiggy wants to be valued at INR 87,300 crore ($11.3 billion), which is at the upper end of the pricing range of INR 371-390.

    Important Investors and Allocation Information

    Swiggy’s anchor segment has been supported by a wide range of domestic and foreign investors, with a sizable percentage of the shares going to Indian institutions. SBI Mutual Fund, Kotak Mutual Fund, HDFC Life, and Axis Mutual Fund are examples of domestic investors.

    By indicating strong institutional backing, the anchor allocations are intended to stabilise the IPO and perhaps draw in more retail and non-institutional investors.

    Evaluation and Financial Performance

    Swiggy has prioritised expansion, as seen by its most recent financial reports, which show notable advancements. Swiggy reported revenue of INR 11,247 crore for FY24, up 36% from INR 8,265 crore for FY23.

    In comparison to the prior fiscal year, losses also significantly decreased, falling 44% to Rs 2,350 crore. The business’s future growth, especially in its network of dark stores, as well as investments in marketing, technology, and possible acquisitions, will be financed by the IPO proceeds from the main issue.

    In an attempt to fortify its position against its main rival, Zomato, which has a market worth of INR 2.1 trillion, or INR 2.18 lakh crore (as of November 6, 2024), Swiggy has entered the public market.

    Current Anchor Book Investors

    Notable international investors that have made anchor book investments in the company include New World Fund, Fidelity, Omnis Portfolio Investments, Nomura, Government Pension Fund Global, PGGM World Equity, Blackrock, Carmignac, Eastspring Investments, Citigroup, TOCU Europe, Integrated Core Strategies, CLSA, Matthews Asia Funds, and Societe Generale.

    ICICI Prudential Mutual Fund, Kotak Mahindra AMC, SBI Mutual Fund, Axis Mutual Fund, Aditya Birla Sun Life Trustee, 360 ONE, Mirae Asset, Nippon Life India, Bandhan Mutual Fund, Invesco India, Motilal Oswal Mutual Fund, Sundaram MF, Tata MF, UTI Mutual Fund, DSP India Fund, Ashoka Whiteoak, Baroda PNB Paribas, Helios MF, and Avendus were among the domestic institutional investors that took part in the anchor book.

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  • Soon, ONDC Will Offer Insurance and Mutual Funds

    Next two months, the open-source aggregator platform known as the Open Network for Digital Commerce (ONDC) will be launching insurance and mutual fund products. They will also be partnering with MasterCard for credit card processing.

    Customers with and without salaries will be able to get unsecured credit through ONDC’s six-minute digital loans.

    According to T Koshy, CEO of ONDC, “We have deployed a Marine app, one insurer and two more are coming.” “Even with health insurance, we’re in the game, but our partner isn’t licensed. The vehicle insurance is expected to be finalised within the following month. Plus, MF is scheduled to launch next month. We aim to complete 100-200 transactions before anything else,” he added further.

    Although a debut date has not been announced, the aggregator platform is also planning to add credit card functionality to its existing range of services.

    Loan in 6 Minutes

    Accessible in as little as six minutes, ONDC’s new digital and paperless loans were launched on Thursday. Three lenders and nine buyer apps (often called LSPs) are part of the new offering.

    Zyapaar, Indipe, Paynearby, Easypay, Paisabazaar, Tata Digital, Invoicepe, Cliniq360, and Indipe are among the buyer applications. Karnataka Bank, Aditya Birla Finance, and DMI Finance are among the lenders.

    Economic Survey 2024

    Since its launch in 2022, the number of transactions on the ONDC has soared above 68 million, according to the Economic Survey 2024. The number of transactions increased by 12% month-on-month to 9.95 million as of June 2024. According to Koshy, 12 million transactions were processed by ONDC in July.

    To further emphasise that the ONDC network democratises access for all merchants and “prevents market concentration,” Koshy chimed in. He went on to say that the network ensures that every customer can receive the lowest price on any product or service.

    According to Koshy, small businesses eventually go out of business because platforms favour big suppliers and customers. This phenomenon is known as the network effect.

    About ONDC

    Open Network for Digital Commerce (ONDC), a Section 8 company, was established on the 31st of December 2021. It is an initiative of the Department for Promotion of Industry and Internal Trade (DPIIT), which is part of the Ministry of Commerce and Industry of the Government of India. The objective of this initiative is to develop a facilitative model that revolutionises digital commerce and increase the penetration of retail eCommerce in India.

    A step towards the democratisation of digital commerce, ONDC symbolises a shift away from a platform-centric model, in which a small number of eCommerce companies control the industry, and towards an open, interoperable platform in which buyers and sellers can connect regardless of the platforms they are using. It is intended to move eCommerce away from walled gardens, which are ecosystems that are closed, compartmentalised, and highly stratified, and towards an environment that is more accessible and encourages competition, inclusivity, and innovation for businesses.

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  • Why SIPs are Winning Over Indian Investors

    Reshma Radhakrishnan, a tech professional thriving in Bangalore, embraces life’s joys while keeping a keen eye on the future. Her secret weapon? Strategic SIP investments. “Discipline builds dreams,” she says, echoing the sentiments of countless young Indians across the middle and upper-middle-income groups who’ve turned to SIPs for secure wealth creation.

    SIPs, or Systematic Investment Plans, are revolutionizing investing by making mutual funds accessible and affordable. With small, regular contributions, individuals can build substantial wealth over time, capitalizing on the magic of compounding and rupee-cost averaging.

    Think of it like planting a seed – each SIP contribution adds to the soil, steadily nurturing your financial tree. Over the years, compounded returns blossom, multiplying your initial investment. Picture two scenarios: Person A starts investing at 40, contributing Rs. 1000 monthly; Person B starts at 20. After 20 years, A has Rs. 5.28 lakhs, while B has a staggering Rs. 26.56 lakhs – the power of early and consistent investing!

    SIPs offer a treasure trove of benefits:

    • Discipline Without Sacrifice: Regular contributions build financial habits, allowing you to save without compromising your lifestyle
    • Flexibility: Adjust your investment amount anytime to suit your changing needs
    • Convenience: Automate your SIPs for hands-free wealth-building
    • Reduced Risk: Spread your investments over time, minimizing the impact of market volatility

    And the proof is in the pudding! As of 2024, SIP contributions have crossed a remarkable Rs. 1 lakh crore, showcasing Indian investors’ growing confidence. October 2023 alone saw a record high of 7.3 crore SIP accounts and 34 lakh new SIPs. Even with market fluctuations, equity mutual funds through SIPs remain resilient, highlighting their long-term value.

    Industry experts like AMFI CEO NS Venkatesh and Motilal Oswal’s Akhil Chaturvedi see SIPs as the future of investing. They point to the untapped potential in small and mid-cap funds, where continued inflows are expected.

    New Sip Registrations in India From Financial Year 2019 to 2023, by Age Group
    New Sip Registrations in India From Financial Year 2019 to 2023, by Age Group

    Mutual Funds vs. Stocks: Finding Your SIP Sweet Spot
    Building Wealth Brick by Brick: The Rise of SIPs in India
    The Key Takeaway

    Mutual Funds vs. Stocks: Finding Your SIP Sweet Spot

    While both mutual funds and stocks offer SIP options, each caters to different risk appetites.

    Mutual funds, managed by professionals, spread your investment across diverse assets, offering a safer, smoother ride. Stocks, on the other hand, can deliver higher returns but come with higher risk, demanding deeper market knowledge.

    Ultimately, the choice between mutual funds and stocks depends on your individual goals and risk tolerance. New investors or those seeking a secure approach may find mutual funds ideal, while experienced investors comfortable with higher risk might consider stock SIPs.

    Building Wealth Brick by Brick: The Rise of SIPs in India

    Gone are the days of intimidating lump-sum investments and market timing woes. The magic of SIPs lies in their consistency and affordability. Starting with just Rs. 500 a month, anyone can join the investment party, regardless of income bracket. This democratization of finance empowers individuals to take control of their future, irrespective of their financial background.

    But SIPs offer more than just accessibility. They are a masterclass in discipline. The automated nature of these investments ensures regular contributions, even amidst market fluctuations. This eliminates emotional decision-making and instills a habit of saving for the long haul.

    Furthermore, SIPs leverage the power of rupee-cost averaging. By investing at different market levels, they help you buy more units when prices are low and fewer when they’re high, averaging out your overall cost and mitigating risk.

    But the real game-changer is compounding. Reinvesting your returns generates an exponential snowball effect, multiplying your wealth over time. Imagine starting at 20 and consistently investing Rs. 1,000 a month; by retirement, you could have a sizeable corpus, thanks to the magic of compounding.

    This growth mindset resonates with a culturally ingrained inclination towards savings and investments in India. Financial planning is no longer a chore but a gateway to a secure future. Experts like Mayank Bhatnagar, COO at FinEdge, emphasize the importance of seeking professional guidance to navigate the financial landscape and avoid emotional pitfalls.

    Finally, SIPs have the inherent flexibility to seamlessly evolve into Systematic Withdrawal Plans (SWP) during the retirement phase. This strategic transition empowers investors to enjoy a consistent and reliable stream of income derived from their accumulated SIP corpus. This financial maneuver ensures a steady cash flow post-retirement, providing individuals with the financial stability they need during this crucial life stage.

    The Key Takeaway

    SIPs are not just an investment tool; they’re a mindset shift. They are a testament to the power of discipline, consistency, and compounding in building a secure financial future. Indian investors are increasingly finding their financial haven in SIPs. By prioritizing discipline and long-term planning, SIPs empower individuals to navigate market fluctuations and secure their financial future. Whether you’re a seasoned professional like Reshma or just starting your journey, SIPs offer a powerful path to building a brighter tomorrow.

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  • Takeoff Success Story – Online Mutual Fund Distribution Platform for Non-Individual Investors

    Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by Takeoff.

    Investment is all about making your future a better place. It is for the financial security of their capital that one can enjoy in the future. When a person makes an investment, it is to ensure that they get to earn higher returns. Investing in mutual funds goal is not any different.

    Mutual funds are a form of investment if people are able to understand it clearly. Now, individuals are able to invest on their own in mutual funds. For non-individuals like businesses, trusts, and others, Takeoff has taken responsibility since 2020. It is India’s first online mutual fund distribution platform for non-individuals.

    StartupTalky brings all about Takeoff, the platform, its Startup Story, Founders and Team, Name, Tagline and Logo, Funding and Investors, Business Model and Revenue Model, Challenges, Competitors, Awards and Achievements, and more in the article ahead!

    Takeoff – Company Highlights

    Company Name Takeoff Fintech Pvt. Ltd.
    Headquarter Hyderabad, Andhra Pradesh, India
    Industry Financial Services
    Founded May 2020
    Founder Prasad R. Lendwe
    Employees 11-50
    Areas Served India
    Website www.takeoff.in/

    About Takeoff and How it Works?
    Takeoff – Industry
    Takeoff – Founders and Team
    Takeoff – Startup Story
    Takeoff – Mission and Vision
    Takeoff – Name, Tagline, and Logo
    Takeoff – Business and Revenue Model
    Takeoff – Challenges Faced
    Takeoff – Growth
    Takeoff – Advertisements and Social Media Campaigns
    Takeoff – Future Plans
    Takeoff – FAQ

    About Takeoff and How it Works?

    The service that Takeoff mainly provides is mutual fund distribution. The main USP is that the entire process is online and condensed from 30 days to 1 day. Companies can now have the luxury to choose from all the schemes from all the AMCs through an easy-to-access platform. They have 24×7 access and the support team is always just a call away.

    Takeoff also provides KYC services for non-individual clients like businesses, trusts, government bodies etc. Gone are the days when one has to send mountains of documents to the AMCs and has to suffer the two months of hassle while their KYC was being processed. The Takeoff team takes only minimal documents and gets the KYC processed within just 7-10 working days.

    Takeoff – Industry

    Takeoff operates in the financial services and mutual fund industry.

    Growth in mutual fund industry AUM:

    The mutual fund industry has witnessed a growth of 30.82% from 2020 to 2021 with Rs. 26.07 trillion AUM (Assets under Management) in 2020 to  Rs. 34.10 trillion AUM in 2021.

    Split of investor accounts:

    The total number of investor accounts of Takeoff as of March 21 was 9,78,65,529, from which  7,91,859 (0.81%) is Institutional investor accounts and  9,70,73,670 (99.19%) are Retail and HNI investor accounts.

    Split of industry assets:

    The Total industry assets of Takeoff as of June 21 is Rs. 34,10,403 crore, from which Retail investor assets is Rs. 18,33,568 crore and Institutional investor accounts are Rs. 15,76,835 crores.

    Takeoff – Founders and Team

    Prasad R. Lendwe - Founder of Takeoff
    Prasad R. Lendwe – Founder of Takeoff

    Takeoff is founded by Prasad R. Lendwe, an Electrical Engineer. He is an MBA droupout from Kalina University, Mumbai. Apart from being the founder of Takeoff, he runs a Finance based YouTube channel, Convey by Finnovationz as well and has more than 1.8 M Subscribers.

    The current size of the Takeoff team is 15-18 members. The work culture in Takeoff is very relaxed and informal. They believe in working hard and playing harder. It basically means, during office hours, one can find them hunched over their laptops. During lunch, however, the team can be found engaging in spirited table tennis tournaments and other games.

    Takeoff – Startup Story

    Before starting Takeoff, the company was focused on their Youtube channel Convey by FinnovationZ. Through this channel, they were able to spread financial awareness for the past 6 years.

    In Jan 2020, they decided to take some of their own advice and tried to invest on behalf of their company. There are some surplus in the current account and the fact that they are earning 0% interest on it bothered them a lot. After using platforms like Zerodha and Groww in the past, it was wrongly assumed that the process would be just as easy.

    It was only after the actual process started, they realised how difficult it is in reality. As there was no dedicated platform working towards the mutual fund investment needs of non-individualism, the idea of the formation of Takeoff first came into their mind.

    Takeoff – Mission and Vision

    Takeoff’s short-term vision is to spread awareness and encourage more non-individuals to begin their mutual fund investment journey. They intend on doing this by providing top-quality service and exploiting their first-mover advantage.

    Their long-term vision is to emerge as a complete investment solution for non-individuals and to become a one-stop destination for any kind of investment that companies and other non-individuals want to indulge in.

    The core belief is centred on the fact that non-individuals, whether its companies, trusts, proprietors, or any of the others, deserve the same facilities and the same ease that individuals do. In the past few years, thousands of platforms have cropped up for retail investors, but companies have, sadly, been left out. It is Takeoff intention to right this wrong and fixes the imbalance.

    Takeoff logo

    Takeoff Fintech Pvt. Ltd. is the officially registered name of the company.

    The company doesn’t have an active tagline yet.

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    Takeoff – Business and Revenue Model

    Takeoff is working on a distribution model. The platform is currently free to use for all of their clients and it will always be free to use. Any non-individual can register and open accounts in Takeoff. No amount is charged from the clients. The revenue comes from the AMC (Asset management company). A fixed brokerage amount is paid for each AMC.

    Takeoff – Challenges Faced

    The lack of awareness among the non-individuals in India that they too can invest in mutual funds on behalf of their organization is the most challenging part of Takeoff. The conversion is not easy from a lead to an active investor, as the company has to explain the whole product and the industry at the same time over a very short span of time to their clients.

    Takeoff – Growth

    The journey from 0 to 100 Clients

    The journey was of severe ups and downs, like a roller coaster. Takeoff got their first client in December 2020 on their beta version and after some infertile months, the platform started gaining recognition, through several marketing campaigns. Currently, they have over 550 registered users and the company is experiencing slow but steady growth, they believe in value over volume.

    Customer Retention

    Takeoff believes that the best customer retention can be achieved only through superior customer service. Investments are a fairly complicated process, even if one makes it seems as easy as possible, clients will still have doubts. It is very important to make the clients feel as though the company is with them at each step along the way, in case they encounter any kinds of difficulties. This process has helped Takeoff in retaining its clients.

    Takeoff – Advertisements and Social Media Campaigns

    Takeoff has tried various platforms and a plethora of campaigns to generate leads and convert them to active investors. LinkedIn ads and their own Convey YouTube channel have been proved a constant success for the company. The company is looking forward to more events and other activities so that they can reach out to the target audience and make the platform enriched with the soul vision of the company.

    Takeoff – Future Plans

    The company is doing quite well. It has started to make a name for itself and is experiencing a steady inflow of clients in future. Both their client base and the AUM have started to increase.

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    Takeoff – FAQ

    What is Takeoff?

    Takeoff is India’s first online mutual fund distribution platform for non-individuals. They help non-individuals like companies, government bodies etc to invest in mutual funds.

    Who is the founder of Takeoff?

    Takeoff is founded by Prasad R. Lendwe.

  • ETrade Business Model | How does ETrade make money?

    ETrade has established itself as one of the finest online brokers for trading options as a pioneer in the online brokerage sector. It was one of the first online brokers in the United States and it became the first online broker to provide commission-free trading on ETFs, stocks, and options trades in October 2019. This makes you wonder, how does ETrade make its money? And what is its business model?

    A business model is a crucial component of every startup’s long-term success since it is what unlocks value. In some ways, creating a business model is more than just figuring out how to make money. With that in mind, let’s look at the ETrade e-trading platform’s business model.

    About ETrade
    Products and services offered by ETrade
    What makes ETrade unique?
    ETrade Business Model
    How does ETrade make money?
    FAQs

    Options trading with ETrade

    About ETrade

    ETrade logo
    ETrade logo

    ETrade, a financial services business located in New York, was formed in 1982 by William A. Porter and Bernard A. Newcomb. Over the years, the firm has grown to over 30 outlets across the United States, making it one of the industry’s pioneers.

    ETrade/E*Trade is an electronic trading platform that allows novice and experienced traders to purchase and sell financial assets such as common stock, preferred stock, futures contracts, mutual funds, options, fixed-income investments, and exchange-traded funds.

    Products and services offered by ETrade

    Etrade earns money through various products and services, including a day trading platform for retail customers. Let’s take a brief look at the services that the firm provides.

    • Brokerage: E-zero-commission Trade’s US stock trading platform for ordinary clients is known as a brokerage account. They enable you to buy and sell equities, ETFs, mutual funds, potion, and bonds, among other things. At a low fee, you may also trade futures and options contracts, as well as bonds. Until their kid reaches the age of majority, a parent or guardian can handle a minor brokerage account.
    • Services for Portfolio Management: The portfolio management service is given to both individual and institutional clients. Portfolios can be handled both automatically and manually. Depending on your circumstances, you may also obtain a personally customised portfolio from a financial counsellor.
    • Bank account: Individuals, families, and companies may open a bank account with ETrade, which provides higher-interest savings and checking accounts. Free initial checks, online bill pay, and an ATM/debit card are all available. You may also use the free Transfer Money service, pay with your credit card online, and borrow against your investments.
    • Retirement services: ETrade offers retirement (IRA) accounts for tax savings, minor’s savings that an adult may handle for the benefit of a child until they reach the age of majority, and persons commencing their savings at the age of 59.5 years old.

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    What makes ETrade unique?

    ETrade has a long history as an online broker, and its platforms are well-known for being straightforward to use. And even though it offers many services, including news, research, and screeners, ETrade is still simple to use.

    ETrend features a user-friendly interface that allows you to personalise the platforms according to how you want to connect with them.

    ETrade offers three web-based/downloadable platforms and two mobile apps, making it an excellent alternative for passive investors and casual traders. To help optimise the value of deposits earned in its brokerage operation, it also offers banking products through the ETrade Bank, an FDIC-registered federal savings bank.

    It joins a growing number of online brokers that have switched to commission-free stock, ETF, and options trading in October 2019.

    ETrade Business Model

    ETrade employs a strategy that generates revenue from payment for order flow as well as interest income earned on the free float. To generate income on customer funds, ETrade invests them in money market accounts. Margin rates levied on purchasing or shorting stocks on the business’s platform also generate revenue for the company.

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    How does ETrade make money?

    ETrade charges no commissions, which begs the question: how does ETrade make money?

    Margin

    Clients at ETrade pay interest on money borrowed to buy stocks and on money borrowed to short stocks. For many broker-dealers, margin interest is a crucial source of revenue, and ETrade is no different. It has rates that are higher than the national average. Depending on the total amount borrowed overnight, they start at 8.95 per cent and go down.

    Flow of Orders

    ETrade makes the majority of its money through monetising its order flow. Customers’ buy and sell orders are sent to market makers for execution by ETrade. The company is compensated for the order flow in exchange.

    When E-margin Trade’s customers borrow money to short or purchase stocks, ETrade receives interest. A transaction-fee mutual fund costs $19.99 to buy or sell at the business.

    This is a standard business procedure; therefore, ETrade isn’t doing anything out of the ordinary here. ETrade sends orders to the groups to adjust for the order flow. This is also a frequent industry practice.

    ETrade receives less than a cent per share on average for routing orders. That may not seem like a lot, but when you consider that there are about 300,000 trades each day, with several shares per order, it adds up.

    Earnings from interest

    ETrade advertises heavily on the need of filling your brokerage, bank, retirement, or PMS accounts with them since the more money you invest with them, the more interest you get. The business of ETrade is based on the interest produced by the float, which is invested by millions of customers. Offering free trading to retail investors is a fantastic way to improve their float because they are the least likely to trade actively.

    Service charges

    Portfolio management, retirement accounts, and other essential portfolio services are also profitable for ETrade. Fees and service charges are how they make money from these services.

    The fees for portfolio management vary from $500 to $250,000, with a 0.30 per cent to 0.75 per cent cost.

    ETrade charges $25 for premature withdrawals, excess contribution withdrawals, and re-characterisations in retirement accounts (changing from Roth IRA to Traditional IRA).

    And, depending on the debit balance available at the time of the trade, margin trading costs range from 5.45 per cent to 8.95 per cent.

    In the year 2019, ETrade generated $588 million in fees and service charges.

    Commissions on mutual funds

    ETrade charges $19.99 to buy or sell a transaction-fee mutual fund. It costs $49.99 to sell a no-load, no-transaction-fee fund fewer than 90 days after acquisition.

    ETrade also profits from mutual fund trades through 12b-1 fees, sub-accounting fees, shareholder service costs, and marketing support payments.

    Trading Commissions

    Only ten to twenty per cent of the millions of traders are active. Active traders, on the other hand, trade often and in large amounts. And many of them trade futures and options, the most lucrative part of the stock market.

    This 20% of active traders generate twenty times the money that they lose by providing free trading.

    Fees for Futures, Options, and Bonds on ETrade

    The larger the number of active traders operating in any of these categories, the higher the commissions because ETrade works with huge volumes rather than premium pricing.

    This information makes you wonder if ETrade is losing money on these products. ETrade loses money on its free service. However, because over 80% of traders aren’t active in the markets, they don’t lose much money. ETrade lost $23 million in securities trading fees in 2019. The $23 million loss is well worth it for their business model, given the $421 million in trading commissions they receive from active traders.

    FAQs

    When was ETrade Financial Corporation founded?

    ETrade Financial Corporation was founded in 1982.

    Does ETrade charge commission?

    ETrade does not charges commission for online US-listed stock, ETF, and options trades.

    Which is the parent company of ETrade?

    Morgan Stanley is the parent company of ETrade.

    Who are the competitors of ETrade?

    Some of the top competitors of ETrade are:

    • HyperStock
    • Firstrade
    • SAG Investor
    • Scottrade
    • MProfit
    • RetailGraph
    • eSignal

  • Mutual Fund Industry in India – Market Size, Major Players, Current Condition

    Nowadays, people are working for future prosperity, where something you have earned in the present will reflect as a beget in the future; that too something huge in return.

    Have you heard of Mutual funds, where a pool of money is collected from many investors to be funded in securities, bonds and other money market instruments? A Mutual fund plays as an investment as well as a company. Mutual funds works, where you as an investor buy a unit of share of a part of the mutual fund say as, portfolio’s value. Therefore, technically, the investor buys partial ownership of the company and its assets.

    If the funded amount showed positive returns which highly depends on the securities the investors decided to buy, then the investors receive profit, while in the case of deprivation in the return; vice-versa. The investor of mutual funds earns their returns in three different ways such as- dividends, Capital gain and a hike on the mutual fund’s scheme.

    Classification of Mutual Funds Industry in India
    Market Size of Mutual Fund Industry in India
    Recent changes by SEBI in the Mutual Fund Industry in India
    Major Players in the Mutual Fund Industry in India
    Current Condition of the Mutual Fund Industry in India
    FAQ

    Classification of Mutual Funds Industry in India

    Equity Funds:

    Most prevalent mutual fund schemes in India where investors participate in stock markets in the long run because the return in those markets is comparable high to others.

    Sector-specific fund

    These mutual funds have high risk in terms of high potential return, where the investors fund their money in specific sector segments such as mining, banking, infrastructure etc.

    Index funds

    Index mutual funds are a medium risk factor, to those who don’t want any fund manager to manage their returns.

    Tax saving funds

    These funds are a tax deduction, where these investments have a 3 year lock-in period that plays as tax benefits to the investors.

    Debt Funds

    These ilk of mutual funds are credit risk, which has a low-risk appetite as well as low outcome. Debt funds are suitable for those investors who are coveting steady income from the fixed investment such as Government bonds or debentures.

    Money Market Funds

    Investors who are seeking reasonable returns in the investment over a short period of time can enroll into money market funds. Moreover, it has a low-risk factor where the return comes in liquid form so it will be a reasonable return on investments.

    Hybrid Funds

    It is similar to Balanced funds, despite the proportion of equity assets being juxtaposed to balanced funds. This kind of mutual fund is highly recommended to retired or geriatric who expect low risks.

    Balanced Funds

    Balanced mutual funds divide the investment between equity and debt mutual funds, where moderate returns with comparatively low risk vary according to the market risks.

    Open-ended funds:

    Here, the investor can enter, redeem or exit at any point in time because an open-ended mutual fund doesn’t have any fixed maturity period

    Close-ended funds

    Close-ended funds have a fixed maturity date, so the investors can only enter into the market during the initial period of any mutual funds scheme known as the new fund offer; Furthermore, their investment can be redeemed only when the maturity period expires.

    Gilt funds

    These mutual funds invest only in Government securities, which has no credit risk associated with their investment but has a high interest risk rate.

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    Market Size of Mutual Fund Industry in India

    Mutual fund value as a part of individual wealth in financial assets
    Mutual fund value as a part of individual wealth in financial assets

    The mutual fund industry in India was established back in the year 1963 at the launch of Unit Trust of India by the Government of India. The first very step to the millennials happened in 1964, where UTI introduced the first mutual fund scheme in India and public sector enterprises likewise SBI, Punjab National Bank, Indian Bank, and Bank of Baroda entered the scheme, which was worth 6,700 Crores at the end of 1988.

    After a great heyday in India regarding mutual funds, the industry colluded to open a portal for the private sector and by 1993 onwards India has burgeoned in the Mutual fund Industry.

    According to the statistics, it is reported that the Indian mutual fund industry had assets under management of 31.43 trillion as of March 2021 which resulted in a jump of 41% in fiscal 2021.

    Recent changes by SEBI in the Mutual Fund Industry in India

    In June 2021, some amendments were made to SEBI regulation 1996, where they should comply with those new rules of the mutual funds’ stated by 1st September 2021. The mutual fund is required to share details of risk, performance, outcomes, portfolio to investors only for the scheme they have invested in.

    Major Players in the Mutual Fund Industry in India

    The money invested in the mutual funds is managed and the schemes are operated as per the regulations of mutual funds by entities registered under the companies act for this specific purpose and they are known as Asset Management Companies. The major AMC offering services in India 2021 are:

    • SBI Mutual Fund
    • HDFC Mutual Fund
    • ICICI Prudential Mutual Fund
    • Reliance Mutual Fund
    • Aditya Birla Sun Life Mutual Fund

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    Current Condition of the Mutual Fund Industry in India

    The Mutual Fund Industry’s Assets Under Management (AUM) saw a rise of 41 per cent in FY 2021. As of 30th June 2021, the AUM was valued at INR 33.67 trillion. In fiscal 2021, the biggest attraction was the corporate bond funds with net inflows of INR 3,299 crore. The highest net outflows of INR 28.923 crore were seen in credit risk funds.

    Conclusion

    Indian People are big fans of Cricket and the players too. And these cricketers are big fans of Mutual Funds or it seems as they say “mutual funds SAHI HAI!”. The mutual fund industry is rapidly growing and the SAHI HAI campaign that was launched in 2017 has contributed a lot to this growth as people are aware of mutual funds and results in investor education.

    The first quarter of FY 21-22 added 12 lakh investors to the fast-growing mutual fund industry in India. As more people learn about the benefits and security provided by mutual funds, the industry is expected to see favorable growth in the coming years.

    FAQ

    What is the mutual fund industry?

    Mutual Fund Industry are the companies that pool money from various investors and invests the money in securities like stocks, bonds and short term debt. A portfolio is the combined holdings of the mutual fund of the company.

    What is the total revenue of the Mutual Fund Industry in India?

    As of 30 June 2021, the AUM (Assets Under Management) of the Indian mutual fund industry is around INR 33.67 trillion. The AUM of the Indian Mutual fund Industry as of 30 June 2016 was INR 13.81 trillion. The industry has seen a two-fold increase in the span of 5 years.

    Who is governing and regulating the mutual fund industry in India?

    Mutual funds are primarily regulated by the Securities and Exchange Board of India (SEBI). The approval of the Reserve Bank of India (RBI) on a mutual fund is required to provide a guaranteed returns scheme. The Ministry of Finance of India acts as the supervisor of the RBI and SEBI. The mutual funds are regulated by SEBI, RBI, the Companies Act, Indian Trust Act, Stock exchange and the ministry of finance.  

  • Niyo Money (Goalwise) vs Scripbox: The Top Online Mutual Fund Startups

    In the past few years, many online mutual fund investment portals like Niyo Money (Goalwise) and Scripbox have come about which have simplified the process of investing for individuals. This has been mainly beneficial for investors and now gone are the days where people don’t have to go bank branches in order to be able to invest in Online Mutual Funds.

    However, before you begin investing, you need to do research on which online mutual fund you want to invest in and think about the purpose of the investment and when you need the money back. Based on that, you need to know how much to invest in equity, how much in debt, and how all of this ties in with your financial goals in life. This article will help you choose a mutual fund platform according to your needs.

    Golawise vs Scripbox

    Benefits of Investing in Mutual Funds
    Brief on Niyo Money (Goalwise)
    Brief on Scripbox
    Direct Mutual Fund Investment
    Focused Mutual Fund Selection
    Goal Based Investing
    Glide Path Strategy
    Ease to us
    Transfer Plans
    FAQ

    Benefits of Investing in Mutual Funds

    One of the key advantages of investing in a mutual fund is that each investor (even with a small investment) gets access to professional money management and expertise. Also, it would be very difficult for an investor to create a diversified portfolio of investments on his own with a small amount of money. With mutual funds, each investor participates proportionally in the return the scheme generates.

    Each unit gets a proportional share of gain (or bears loss) from the fund. There is a portfolio report generated for each investor, which tracks all investments and the returns generated by the mutual fund. Investors can draw their money any time they want, also they can invest small amount.

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    Brief on Niyo Money (Goalwise)

    Goalwise is an online wealth management platform that allows users to buy and invest in direct mutual funds. Goalwise headquarters is in Bengaluru, Karnataka. Goalwise has been a Subsidiary of Finnew Solutions Private Limited since July 2020. Goalwise has received a total of $1Million in funding. Goalwise main competition is Kuvera, Groww, and ETmoney.

    Niyo Solutions acquired Goalwise in July 2020. The company plans to launch international and domestic stocks, Robo-advisory, and auto-invest products in the next few months. Now they have started offering zero commission investment.

    It is a new age mutual fund investing platform which provides goal-based investing for investors looking to invest in direct mutual funds. With Goalwise one can easily set up SIPs or invest a large amount in the mutual funds chosen by its algorithms. If someone is a first-time investor looking to get started quickly as well as experienced investors looking for planning and automation.

    The Goalwise app has features like automation in fund selection and switching, automation in asset allocation based on the goal time horizon. The app is also highly customization to suit the needs of every individual investor.

    Company Name Goalwise
    Headquaters Bengaluru, Karnataka
    Founded On 2015
    CEO Swapnil Bhaskar
    Annual Revenue $1.2M
    Sector Consumer Finance & Credit Cards

    Brief on Scripbox

    Scripbox is an online platform that allows users to invest in mutual funds. Scripbox is headquarters in Bengaluru, Karnataka. The founder and CEO of Scripbox is Atul Shinghal, while the investors including Trusted Insight, Omidyar Network, and Accel Partners. Scripbox’s main competitors are FundsIndia, Fisdom, and Groww.

    As of August 2019, Scripbox has 413.9 thousand fans on Facebook and 2.4 thousand followers on Twitter. Scripbox is a user-friendly app-based investment platform that makes investment completely hassle-free. One can start a SIP or make a one-time investment with the help of Scripbox. It is a great app for beginners as it also automates most of the investment process through its scientific and unbiased fund recommendation. It is the only app which has algorithm that reduces Long Term Capital Gain Tax at the time of withdrawal. Scripbox also generates capital gain tax statement that will us male tax return or annual IT return. Also they do not charge for services.

    Company Name Scripbox
    Headquaters Bengaluru, Karnataka
    Founded On 2012
    CEO Atul Shinghal
    Annual Revenue $1.5M
    Sector Consumer Finance & Credit Cards

    Direct Mutual Fund Investment

    The mutual fund investment you do with the help of a broker or financial advisor includes an extra 1% which is paid to the broker or financial advisor. So some mutual fund plans are called regular plans. You should read about the expense ratio to learn how your broker, commission agent and distributor agent, and distributor make money when you invest in mutual funds.

    With Goalwise, you will be investing only in direct mutual fund plans and will be earning an extra 1% on your overall investment. Scripbox however has an algorithm that creates a basket of ten mutual funds. The firm claims to make mutual fund investment simple and jargon-free for investors with no financial background. It also allows the customer can keep a check on their portfolio from their mobile or computer.

    Types of investments provided by both Goalwise and scripbox

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    Focused Mutual Fund Selection

    One of the challenges of mutual fund investing is to find the right mutual funds to invest in a lot of them are dependent on friends, network, and information on the web to find the right mutual fund. However, the bigger challenge is to know when to get out of a particular fund. Goalwise has a wide fund selection criteria and also tries to solve this problem by using data to suggest mutual funds.

    When it comes to Scripbox it has more than 8000 choices in the market with seasoned investors which will give a tough time in deciding which to invest in. The Scripbox algorithms choose to perform mutual funds basis on their historical performance.

    Goal Based Investing

    Goal-based investing is one of the smartest ways to grow wealth and achieve all your life goals. A lot of the first time users are not aware of goal-based investing and they then focus on growing their money that is what Goalwise is known for as it is goal-based investing. When you tie up your investment with a goal, you are more likely to be happier.

    Scripbox on the other side provides growth with the principle of safety. In scripbox money is first invested in liquid funds. A fixed portion from this is then invested each month in index funds. The benefits of this are:

    • Security and stability similar to FDs
    • Better taxation than FDs thanks to indexation
    • Better returns than FDs
    • Full flexibility to stop or withdraw anytime

    Glide Path Strategy

    The glide path formula is a methodology by which asset allocation is achieved as your portfolio changes every time. Let’s understand this with a simple example from Goalwise and Scripbox :

    In Goalwise: One of your goals is to have 40 lakh for child education in the next 6 years. Based on your risk profile the initial investment will be 60% equity and 40% in debt instruments. All your SIP will be done to get exposure in the 60:40 ratio in the equity debt market.

    By the final year, your exposure on Equity: Debt ratio would be 0:100%. This is to ensure your investment is safe from market volatility and you receive your goal amount, despite the market going down. Goalwise automates this process and makes it easier for you to maintain asset allocation based on your goal time frame.

    Whereas at Scripbox they have a practical action plan in place to create your child’s college education fund. In Scripbox it starts out with the right Financial Goal where they will help you estimate the amount you will need for your goals taking inflation into consideration. After that, they will create a customized financial plan for your child’s college education.

    This plan will be based on the type of college, start date, your current savings, and the potential increase in your income. It will then make the right investments by deciding on the right mix of investments that are suited for the customer’s goals and their personal preferences.

    Ease to us

    The best part about Goalwise apart from being free is, it requires only a one-time setup. It is a complete set it and forget it kind of system. You can revisit anytime and make changes if required. However, the best thing to do is to set it up once and keep investing.

    With Scripbox it is one click investment where one can choose between SIP (systematic investment plan) and OTI (one-time investment) and invest in the recommended top mutual funds in India with a single click. You can stay on track with your investments and also inform you in case you need to change your selection.

    Transfer Plans

    In Scripbox if you want to invest a large amount in equity, If you want to invest a large amount in Equity, but also want to reduce the impact of volatility, this plan is ideal for you. Instead of keeping your large amount in your bank account, park it in liquid funds which grow 2-3% faster.

    And most importantly it is flexible. You can stop, and restart, your STP at any time. In Scripbox the amount is fully invested into Liquid funds. Then, every month, a certain amount is moved from these Liquid funds into Equity funds.

    The transfer plan in Goalwise allows you to switch from regular fund to direct fund. With Goalwise, you could track all your external investments and see which all regular funds you have invested in.  You can also move all mutual funds investment to Goalwise.

    So you decided to start using Goalwise and also move all your funds from other brokers/distributors to the Goalwise platform, you could do that with just a few clicks. If you ever feel you are stuck with your existing mutual fund advisor, a feature like this makes it easier for anyone to take control of their funds.

    FAQ

    Are the mutual funds picked by Goalwise and Scripbox always the most profitable ones?

    Every fund selection process goes through underperformance. As these services use AI, the pick would be the most accurate one. But the stock market is highly volatile, nothing is predictable. There will be ups and downs in the short term.

    What is mutual fund SIP?

    A SIP or a Systematic Investment Plan allows an investor to invest a fixed amount regularly in a mutual fund scheme, typically an equity mutual fund scheme.

    Which one is better Scripbox or Goalwise?

    Goalwise provides you a goal-based investing and it takes no commission. There are no hidden charges and no account opening and managing charges as well. This means it is completely free. Other services like Scripbox use hidden charges to get money. So, Neo Money(Goalwise) is better.

    How does wealth tech company make money?

    They apply hidden charges, account opening, and managing charges. Also the premium plans.