The investment world offers huge opportunities for disruption. Most existing disruptors have used technology to change the way transactions take place. The biggest success stories are in the transaction-enabling space. The real opportunity, however, lies in the knowledge-enabling space. Investors want to know more.
They want to learn investing, and this creates a market for meeting their do-it-yourself (DIY) aspirations. They need to be taught and advised. Equity research is one big opportunity. Financial planning is another. Both these spaces are nascent even after three decades after liberalization and technological advances. Investors want advice that is strictly professional, cost-effective and discretionary. While we have had a few startups in both spaces, I still see a need for better interest alignment, greater competency, stronger domain expertise, and better interfacing.
When made simple, complex subjects should retain their core and must not be oversimplified or clichéd. They should ensure that an individual who wants to invest by himself is getting everything he needs to make smart, sensible choices and stick to them long enough. The technological interface needs to be clutter free and easy to engage. A subscription model will be the way to go. With financialization still nascent, there’s huge opportunity for an entity to grow as an independent, investor-centric business.
The time is ripe to create a knowledge and information service for the DIY investor. It should retain and grow trust, fuel an investor’s learning and stay the course with him by constantly evolving to meet his growing needs. It need not be transactional, and keeping conflict of interest out must be the essence of the model. The customers want to learn what technology can’t teach—behaviour, knowledge and more.
Shyam Sekhar is chief executive officer of iThought and an angel investor.