Bullspree, founded in 2020, gamifies the stock market experience and allows users to engage in contests with minimal risk
Recently, the early-stage startup raised $400K in a seed round from multiple angel investors
Bullspree has onboarded over 2,50,000 users so far, with a monthly active user base of 85,000
According to India’s Economic Survey for 2021-22, retail investors held a 44.7% share of the equity cash segment turnover on the National Stock Exchange (NSE) between April and October 2021.
In May 2022, Union Finance Minister Nirmala Sitharaman told the Parliament that over 2.6 Mn new demat accounts were opened every month in 2021-22, growing 6.5X from the 0.4 Mn new accounts per month in 2019-20.
The buoyancy in the equity markets last year and a funding-high-induced IPO rush among Indian startups saw more and more retail investors jump on the equity bandwagon. However, only a small percentage of retail investors make a profit in the stock market, with a vast majority of them making losses on their investments.
Most of this is due to a lack of financial knowledge and resources for proper research before investing. Ultimately, the stock market is a high-risk investment because real money is involved, and the losses once made are for a retail investor to bear forever.
To change this situation, Ahmedabad-based startup Bullspree is working to provide real-world stock market investment experience without the risk of losing real money. Founded in 2020 by Dharmil Bavishi, Harsh Dhanawat and Divyansh Mathur, Bullspree educates users by gamifying the stock market experience.
The startup has already onboarded over 2,50,000 users and has a monthly active user base of 85,000.
The Investment Games
According to Dhanawat, a person looking to gain experience in retail investing needs to first create an account on the platform, and after a quick KYC, which includes verification of the person’s PAN card, the registration is complete.
Thereafter, the person can put some money into the in-app wallet and start ‘investing’ in the ‘stocks’ by participating in contests.
However, there is a catch here. A user can’t directly use real money to invest in stocks. Instead, the deposited money is used as a joining fee for multiple live contests within the app.
Once a participant joins a cohort-based contest using real money, he/she gets some Bullspree virtual coins. Typically, the number varies from anywhere between 4,000 coins and 10,000 coins, depending on the type of contest and the prize money in question.
There is no limit to the number of contests a user can participate in; so long as they can pay the joining fees, they can join the contest.
‘Investors’ are invited to create a portfolio using these virtual coins. “So, let’s say a person has 10,000 Bullspree virtual coins and he invested 5,000 coins in Reliance, 2,000 in TCS and the remaining 3,000 in Unilever. As soon as he deploys the coins, he has to pay a joining fee,” Dhanawat explained.
To keep it as close to a real-world experience as possible, Bullspree has a direct flow of information from the stock markets to reflect accurate stock prices. ‘Investors’ can keep track of their ‘portfolio’ via a live leaderboard and the winner is the portfolio with the highest value at the end of the contest.
The cofounder added that while the contest is going on – typically a contest lasts for around six hours – the ‘investor’ gets access to a range of content about the stocks that were picked.
“Meanwhile, he has access to understand the companies by understanding their patterns, historical trends and how many people have chosen this particular stock. What are the market fundamentals of the stock? What is a market cap? What is the PE ratio?” said Dhanawat, adding that the users also get access to 30-second video clips explaining key market concepts if a person lacks an understanding of the same.
Bullspree’s business model is based on these contests. The ‘investors’ have to pay a joining fee to participate and that is the primary source of income.
According to Dhanawat, of the total pool collected, Bullspree takes a commission of 20%, while the rest is distributed among the top 65% of the participants in a given contest. Therefore, if an ‘investor’ finishes in the 65th percentile of the competition, he/she is still eligible for some sort of reward.
The users can withdraw their winnings after they cross the INR 100-mark in terms of winnings by linking their bank accounts with the app. Apart from winnings, ‘investors’ also receive several insights into why their ‘portfolio’ performed the way it did at the end of each contest.
Bullspree had a Day 30 retention rate of 57% in July, with an average revenue per paying user of INR 250 per month.
Recently, the early-stage startup raised $400K in a seed round from the cofounders of Swiggy’s Dineout, Lighthouse Canton MD-Wealth Management India Manas Chadha, senior partners from law firm Luthra & Luthra, Infibeam Avenues MD and CEO Vishal Mehta, Cisco Director-Finance Amit Khetan, among others.
Bullspree has already deployed the funds it raised to upgrade tech capabilities and hire talent across the board.
The Importance of Educating GenZ Retail Investors
Talking about the inspiration for starting Bullspree, Bavishi said that the founding team realised that there was a gap in terms of education for retail investors for investing in the stock market.
“Whenever the Gen Z retail investors, in the age group of 18 to 25, start their retail investment journey, they start on do-it-yourself platforms. These people end up losing tens of thousands to lakhs of rupees just to get two different things: an adrenalin rush and an expectation of higher rewards,” Bavishi explained.
He said that Bullspree is looking to democratise the system of investing through gamification. According to the cofounder, this allows the ‘investors’ to gain confidence and receive an experiential learning journey.
“We want to empower the investors predominantly in the 18-25 age group,” he added.
Explaining the startup’s philosophy, Bavishi said that for the country’s GDP to grow, its retail investment segment has to grow on an exponential basis. For that, there is a need to inculcate the culture of investing as soon as a person becomes eligible to invest.
“We want that people should not get scared away by booking heavy losses in their initial journey and become dormant…we believe they need an environment in which they can practice their skill sets and at the same time get access to skilled information…At least if we can bring a change in mitigating the losses of the retail investors, we have created an impact on our GDP,” he added.
The startup is looking to introduce in-app purchases in the next three months. One of the more important options that will be made available for an in-app purchase will be the option to mid-swap, giving the users the intra-day trading experience.
Apart from mid-swap, which will be a pure-play revenue stream, Bullspree is also looking to introduce a subscription plan.
“Right now, we give premium macroeconomic trends. We give insights on what went wrong, and how exactly it works on our Telegram groups. We want to monetise this by introducing a subscription plan,” Mathur said.
Currently, the startup provides bite-sized videos for free. However, Bavishi said that the same will be moved behind the paywall once subscription plans are introduced.
“We are in the process to onboard 16 straight-forward topics of the stock market into 30-second bite-sized videos, which we’ll be incorporating in the next 45 to 60 days,” Mathur added.
Bullspree is looking to create a risk-free environment for aspiring young retail investors who are looking to get that proverbial ‘first bite’ of the stock market. A gamified approach and a lot of hand-holding allow ‘investors’ to learn as they play, picking up necessary skills to play in the big leagues in the future.