Mumbai: The strategic fintech investment team of Eight Roads, the proprietary investment arm of Fidelity International, has made its first investment in India, putting in $4.5 million in Kuvera, a tech-based wealth management startup, according to a senior executive.
The company that makes venture capital investments across sectors, had set up a global team for strategic investments in the fintech space across India, China, the UK, Singapore, and Hong Kong to add strategic value to Fidelity’s global operations in investment management, Alokik Advani, who heads the fintech strategic investment team, said over the phone. Eight Roads will make these investments from its balance sheet. The team will look at making investments just after the seed or angel stages.
“The focus is on companies that help us understand certain domain spaces and helps us determine how we should reach customers in new markets, how we should deepen capabilities and create better automation of processes," said Advani. Kuvera is a zero-fee mutual fund investment platform that provides an option to set investment goals such as buying a house or a car or paying for education, aimed at motivating a culture of savings and investment.
The startup claims to have 100,000 users who manage about ₹3,000 crore in mutual fund assets.
“We estimate that our user base will grow five-fold by this time next year," said Kuvera founder and chief executive officer Gaurav Rastogi.
“We like the platform, theme and traction they have had and that they help with costs and customer experience," said Advani, who led the $4.5 million round in Kuvera.
The fintech team made its first investment in October when it led a £14 million round in Moneybox, a UK-based mobile savings and investment app. The Eight Roads fintech team plans to make more such investments globally in the wealth management space, though it has no specific allocation or targets as it is not structured as a fund. “We are happy to take our time, evaluate, and invest opportunistically in fintech startups across the world," Advani said.
The focus of Eight Roads underscores the growing importance of wealth management startups in India’s fintech space, which generally sees insurance, payments and lending startups attract big rounds of funding. Citrus Pay founder Satyen Kothari’s Cube Wealth, a wealth management app aimed at a niche market, and Groww, an online investment platform backed by Sequoia Capital, are some of the recent entrants.
“It is early days for wealth management in India and there is a long way to go, but it is a very promising market space," Advani said. “India is a really interesting market that helps us understand consumer needs. The theme of helping people with long-term financial management is really attractive for us," he said.
Eight Roads Ventures has invested in more than 200 startups across the US, Europe, China, India, Japan, and South-East Asia. Its Indian investments include online medicine delivery firm PharmEasy, non-banking lender Northern Arc Capital, logistics startup Shadowfax, and ed-tech startup Toppr.