How this wealth management startup plans to make you rich

In late 2016, months after entrepreneur Satyen Kothari sold his digital payments business Citrus Payments to its bigger rival, Naspers-owned PayU, for US$130 million – suddenly catapulting him into the exclusive club of ultra rich individuals – he started getting calls from wealth managers suggesting ways to invest his money.

Most of the investment pitches he received were limited to mutual funds, gold, and insurance-related portfolios, with the exception of a few wealth managers who wanted him to invest in lucrative stocks.

Kothari says it was these wealth managers and their limited investment suggestions that made him realize there was a market for an automated tech platform capable of providing better and diverse investment opportunities to professionals looking to increase their net worth.

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In 2017, when he was still on the board of Citrus Payments, Kothari decided to set up his new venture, named Cube Wealth, a tech-driven wealth management firm that would partner with multiple investment funds to create a bouquet of money-making portfolios.

“We Indians, in general, have very little awareness about how and where to invest. This is why we leave our money either in banks as fixed deposits, recurring deposits, or at the most, we buy gold and real estate,” Kothari, founder and CEO of Cube Wealth, told KrAsia.

Mid-income professionals who seek new investment options often receive bad advice from mutual fund platforms or bank representatives, or are even cheated, Kothari said.

“Let’s say you have a big wedding in the family or you want to pursue an MBA course in the next two years. Putting your money in mutual funds is not right for you, as these are long-term investments and you will lose money,” Kothari explained.

For such requirements, he insisted that Cube Wealth has better products than what any other bank will offer. The company, Kothari said, consciously goes beyond the current flavor of putting all of one’s money in mutual funds.

“We are saying that mutual funds should be just one aspect of your investment. There are multiple elements of assets where you can invest depending on the time frame, risk involvement, among other factors.”

A three-pronged approach

Kothari remembers that when he started Cube Wealth, he decided to hinge the company on three basic features: simplicity, variety, and personal guidance.

“Most people get scared when they go to the Money Control [financial portal] website and look at those daunting numbers and charts. We have tried to make our product like any travel ticket booking website or app. You tell us two to three things about your desired investment, and we give you relevant products,” he said.

Once a user commits to an investment, the company sends a weekly portfolio summary, which, Kothari said, is simple to read. “It mentions the total value of the investment and the profit/loss percentage amount. This is all you should care about.”

The company currently curates 17 investment options for its users, who can start investing with as little as 15,000 rupees (US$200) to as high as a few crores (one crore is 10 million rupees or about US$150,000).

Revenue model