Wealth management app CashRich, owned by Thane-based CR Fintech Pvt. Ltd, has raised angel funding worth $1 million (Rs 7 crore) from three undisclosed UK-based individuals.
Previously, the firm had raised angel funding worth Rs 3 crore from undisclosed individuals.
The company plans to spend the fresh funds on further automation of its flagship tech feature Dynamic SIP, CashRich said in a statement.
The CashRich app was launched in mid-2017 by Sougata Basu, who previously worked with Tata Steel. According to the company, Dynamic SIP is an improved version of the Systematic Investment Plan (SIP) of a mutual fund and it follows billionaire investor Warren Buffett’s advice, "Be fearful when others are greedy and greedy when others are fearful”. Basu said, “Though this advice is logical, it is rarely implemented. Retail investors often panic during market crisis, and fail to capitalise on investment opportunities due to psychological reasons. Dynamic SIP uses automation to implement this advice.”
Dynamic SIP aims to guide retail investors in a systematic way to allocate their money in both fixed income and equity. The model considers a user’s risk profile (behavioural finance aspects) and not just relative market valuations.
Dynamic SIP also offers an option of using an index fund.
Basu said, “CashRichDynamic SIP with Index Funds uses a liquid fund and a low-cost broad market index fund for lower-risk automated investments.”
The startup claims to have around 90,000 users for its Android and iOS apps.
Deals in the space
Several other startups, offering a range of wealth management services, have raised venture capital funding in recent times.
Most recently, Groww, an online platform that sells direct plans of mutual funds, raised $1.6 million in a pre-Series A round led by Insignia Ventures Partners, Lightbridge Partners, and Kairos. CureFit founders Mukesh Bansal and Ankit Nagori, its existing investors, also participated in the round, along with others.
In June, mass-market mutual fund investment platform Nivesh.com raised seed funding worth Rs 3 crore from online deal-making firm LetsVenture and a clutch of angel investors including Google India managing director Rajan Anandan and former Infosys global sales head Basab Pradhan.
In May, wealth management startup OroWealth received $1.6 million (Rs 11 crore) in a Series A round led by US-based venture capital firm Powerhouse Ventures.
In March, Bengaluru-based online financial planning and investment platform Kuvera raised $250,000 (Rs 1.6 crore) in its second round of angel investment.
In February, Mumbai-based Fincash.com raised Rs 1 crore ($150,000) from a group of angel investors. The startup offers its users an online platform that helps investors transact as well as monitor their investments in mutual funds, wealth management products and other investments.
Other startups that have ventured into the online sale of financial products include Scripbox, Upwardly and RupeeVest.
Rival Paytm Money also builds investment and wealth management products for its users, all of which are delivered through a mobile application. Paytm Money claims to have already partnered 30 asset management companies that cover over 94% of the industry’s assets under management. It supports investing from over 190 banks through auto-pay mandates and net banking.
Users can opt to invest as little as Rs 100 through SIPs or put in higher amounts through mutual fund schemes.
Paytm Money claims to offer only direct plans of mutual funds that come with lower expense ratio due to zero distribution fees or commissions. The investment service is completely free for users.