Tavaga gets funding to help young people invest in stock markets

When Ravinath Dasika wanted to invest his personal savings in the stock market, he was caught between a rock and a hard place. He thought mutual funds overcharge for a one-size-fits-all product. On the other hand, professional portfolio managers would not handle his level of investment.

As a finance professional, Ravinath felt there should be more intelligent options for retail investors in the internet age. So he started building Tavaga, a platform to connect investors with portfolio managers, earlier this year. Today the Mumbai-based startup announced seed funding from angel investors through Tracxn Syndicate. The amount was not disclosed.

“There was a clear gap in the market which led to the conception of Tavaga,” says Ravinath, an Indian Institute of Technology (IIT) grad with an MBA from London Business School. Ravinath was a portfolio manager for Deutsche Bank.

Neha Singh, co-founder of Tracxn, adds: “On the consumer side, they bridge the gap between one-size-fits-all mutual fund options and fully hands-on stock-picking. For the managers, it provides a platform to offer flexible [financial] products and build a following.”

Everybody’s investment manager

Indians currently have over US$200 billion invested in mutual funds and five times that amount in fixed deposits. Tavaga aims to let them take advantage of the stock market by making it more consumer-friendly. The idea is that retail investors should have access to the same technology, processes, and advice available to professionally managed investment funds.

“The idea is to not to let a person’s limited financial knowledge come in the way of investing right and getting the returns he wants. That is the crux of the problem we are trying to solve,” says Niharika Rao, a co-founder of Tavaga along with Ravinath and two of his IIT Bombay batchmates, Arijit Sarkar and Sridhar Eaturu.

Niharika is a National Law School grad from Bangalore, who worked with a law firm on matters related to Reserve Bank of India policies. Arijit was a trader at Lehman Brothers and consultant at McKinsey. Sridhar built electronic trading systems for Deutsche Bank, where he was a colleague of Ravinath.

For the younger generation

“What we have noticed is that a lot of young people do not understand how the markets work, how mutual funds or different financial products work, and so they find it difficult to make use of them for their savings,” Ravinath tells Tech in Asia.

Keeping in mind its core target group of 25 to 35-year-olds, Tavaga wants to gamify the process of risk assessment and investment decision-making. “Their dashboard has goals and not mutual funds, fixed deposits, or things like that. Their progress will be charted on how far they have gone towards their goals, and not in terms of how many percentage points their portfolio has changed,” says Ravinath.

Tavaga is currently testing the first release of the product with customers who have invested a collective US$750,000. A December launch is planned.

Ravinath did not want to go into too much detail on the product, which has both mobile and web versions. “Broadly, we want to make sure that investment products are accessible to anyone irrespective of whether they can save INR 100 (US$1.5) a day or INR 1 billion (US$15 million) in one go. We are trying to design products that will satisfy such a range of needs.”

Do you think a platform such as Tavaga can help in getting better returns on investments? Drop us a comment below.