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Fintech Asia got in touch with Srikanth at FundsIndia to learn more about the company and his thoughts on the fintech sector in India. This is the first of a series ‘Fintech India‘ which will gather introductions of financial technology organisations based in India.
FundsIndia is a premier fintech platform in India, offering investment services to customers across the country. The platform is promoted by Wealth India Financial Services Pvt. Ltd, a firm based out of Chennai, India. The company was founded by C R Chandrasekar and Srikanth Meenakshi in 2008, and the platform was launched in 2009. Services offered include advice and transactional support for mutual funds, equities, and deposits. Advisory support is provided across various channels – Robo advisory, research-backed fund selections, on-call assigned advisors, and more. Today, the platform serves close to 1,20,000 customers and manages assets close to Rs 4000 crores (INR 40 billion).
How did you come about setting your focus on this particular fintech category? Please tell us a little more about the company’s beginnings as well.
Chandra and I know each other for close to 30 years since our college days. We both went to US for doing our masters degrees in computer science, and ended up in the east coast of US working in financial services companies. We moved back to India for different reasons in the middle of 2000’s and decided to start a venture together. Our background was in investment services – I had worked in a brokerage company and Chandra had worked in a retirement portfolio company – and in India, there was a lack of a platform that specialised in investment services. So, we decided to build and launch such a platform in India.
The CEO of one of my past company used to say that any chance to do something fresh is a chance to do it better. So, when we started to create a new platform, we wanted to create a better platform. We decided to incorporate not just the latest technologies, but also features that were unique and friendly to the Indian market in a customised way. That’s how features like family account aggregation, flexible SIPs, portfolio segregation etc – features that are central USP of our platform came into being.
What transformations have you undergone as a company since starting up?
Since we started the company and launched the platform, the most important learnings we have had were to understand the centrality of advice and the importance of internal research to back up the advice. We understood that in this market, people are interested in investing but not very aware of how and where to invest. And platforms are seen merely as enabling mechanism, but not as educational or advisory mediums. How to get that done, and how to incorporate advice into our offering was the significant learning we have had and has had a transformative effect on the company.
Other companies such as us have actually come at it from the advisory point of view and tried to incorporate technology into it. We have come from the opposite direction – start with technology and platform and bring advisory into the platform. I think our approach has paid good dividends for us.
Thoughts on the present Indian fintech landscape? How does it compare to the rest of the fintech majors in the world like Hong Kong, Singapore, United Kingdom, Sweden, etc. according to you?
The present Indian fintech landscape is booming. Although finance is one of the easiest to adopt to technology (since there is no inventory and all goods are virtual), adoption has been not too fast due to trust and tech barriers. Thankfully, with the advent of smartphones and maturing of the market, both these factors are being overcome. Today, many, if not all, facets of retail financial services are able to operate using digital channels – be it banking, lending, insurance, or investment services. The market is still quite small and in nascent stages, and has great scope for improvement and expansion – a role that the fintech enterprises are eager to take on and fulfil.
Other, larger markets have an evolved audience where acceptance of financial and market-linked products are at a higher level of acceptance. In any market, acceptance of an underlying product must precede the acceptance of a new channel of consuming that product. In India, both are happening simultaneously (as in people new to capital markets are moving straight to fintech channels rather than take an offline to online route), and that is typical of the adoption curves in India.
Which are the sectors in Indian fintech where you think there are untapped opportunities? How does it fit in with your product and growth plans for the immediate future?
I’ll keep my focus on retail opportunities, although there are still significant opportunities in the B2B lending space, especially for SMEs. In the retail space, the payments area is the most actively worked on area at this point. Apart from that, there is a need for an aggregated platform that caters to all the retail financial requirements in terms of loans, deposits, investments, and insurance. There are also opportunities in education – both from a financial literacy point of view as well as, and probably more importantly, behavioural coaching perspective. There is an important need to help people manage their investments from a behaviour perspective, and this is an area that FundsIndia will be very interested in working on in near future.
Please tell us a little about your funding journey – the requirements & objectives in mind when you decided to raise a round/s; the fit you found or were looking for with your investors; what would you be looking for in the future as the business grows?
We have had three rounds of funding for our company. The company was funded with seed money from the founders. Inventus gave us a Series A round in 2010. Foundation Capital stepped in with Series B in 2012, and Faering Capital with Series C in 2015. At this point in time, we are not looking to raise money in the market. When it comes to investors, we always look for a philosophical fit in terms of doing business the right way and we want patient investors. Investment services is like investing in mutual funds – volatility notwithstanding, long term investments get best returns.
What advice would you give to other fintech entrepreneurs?
Patience is not a virtue, it is a must-have for fintech entrepreneurs. More importantly, understanding customers’ diverse financial habits and crafting solutions that will suit them. So, market study and constantly listening to feedback is of salient importance.
Anything else you’d like to add…
We feel like we are doing an important function in an interesting market. This combination is what keeps us going – the relevance of our work and the dynamism of the market place. I don’t think either would change for a long time to come.
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