Back in 2018, when StockGro founder Ajay Lakhotia, quit as Partner of Fosun RZ Capital – prominent SE Asian Investment Conglomerate, fintech startups had taken the centerstage in the startup ecosystem with VCs primarily focussed on investing in payments and lending sector.
At that time, Lakhotia started scouting for a differentiated thesis, with an interest in building an equity book instead of loan book and was engrossed with learning the user behaviour in the stock market.
“The largest asset-backed market, our own stock exchange, stood at $2 Tn market cap and had more than $20 Bn of delivery trade every day. But this was being overlooked by many VCs and startups and that’s what intrigued me and I started studying the stock markets much more deeply,” Ajay Lakhotia told Inc42.
While he busied himself with the understanding and the intricacies of the stock market, Lakhotia realised that there was one angle that nobody was really considering — the power and impact of one’s social circle.
While there are many social media apps that are scaling their businesses leveraging the same, namely, Instagram, Facebook and more, Lakhotia decided to implement the very model of social media to attract and promote users to make stock market investments through StockGro.
“Investing in stocks is perhaps the largest consensus-based social commerce activity with no tech platform addressing this latent need. Stockgro is bridging this gap with a unique technology platform allowing users to replicate this offline behaviour online,” said Lakhotia.
After months of experimenting, surveying and building the platform, Lakhotia founded the company in Jan 2020.
Today, the startup with its focus on millennials boasts of growing almost 2x week on week expecting to cross over 100K users this month, leveraging the platform for stock market investments. “The millennials are a digital, social generation and a social investment platform is the best way to engage them,” he said.
StockGro’s platform today has all the premium B-Schools to hone the trading and investment skills of students and put their theoretical skills to practical implementation.
“The platform includes analysts, experienced investors, algo traders, fund managers sharing their investment strategies and for the first time Democratising Investments,” added Lakhotia.
Stockgro basically enables the decision-making process. It mirrors and leverages the pattern and investment behaviour of the users’ social group, thus expanding the overall market participation.
Through the platform, StockGro is looking to raze two key barriers for a user looking to invest in stocks — lack of understanding of finance and numbers and apprehension of losing money. It does so by simplifying the journey of investments while also inculcating knowledge on the same through gamification.
StockGro enables stock market enthusiasts to build multiple portfolios and compete against their peers to prove their proficiency and win real-money rewards for creating winning strategies.
How The Pandemic Boosted Digital Investments
The pandemic definitely cornered the country’s economy and several jobs with it. With growing job losses and pay cuts, individuals have been tapping into savings and past investments.
Indian millennials, who were earlier apprehensive of investments, are driving the country’s investment landscape today thanks to the access to digital investment platforms and apps. Much of this can be credited to startups such as Zerodha, Groww, ETMONEY, StockGro and others, who are aiming to make investments easier for young age groups.
According to CDSL (Central Depository Services India Ltd) — a subsidiary of BSE (Bombay Stock Exchange) operating as a securities depository in India — the first six months of the country enforcing lockdowns witnessed almost 20% rise in new accounts, which exceeded 25 Mn overall in September. Furthermore, the Securities and Exchange Board of India revealed that of these new accounts, the majority belonged to those aged between 24 and 39.
Though it is building on the interest and awareness in the youngsters, StockGro’s primary target market includes individuals from the age group of 20-40 in both Tier 1 and Tier 2 cities. However, it believes that users in Tier 2 cities are more inclined to explore and learn avenues of making extra money through micro-investments than those in the Tier 1 cities.
The startup builds the interest of the users by allowing them to compete with their peer group through participating in tournaments, where they build their portfolios and slowly start making investments in stock markets by studying the behaviour and the trends that their social group is following. It allows them to study the benefits of investing in certain portfolios before they start making their own investments.
“Stockgro has brought two compelling elements together in one platform, social and trading, and both are super addictive and need all the information to be exchanged in real time,” added Lakhotia.
Though there are many platforms today working on similar lines, Lakhotia believes that the fact that StockGro ‘allows users to build their trust circle for investing in stocks is what helps them stand apart. Without disclosing much details on the partnerships, Lakhotia told Inc42 that Groww, Zerodha and others are collaborators for StockGro and the company is currently exploring venues to work with such financial services startups to expand the participation in Stock Market.
StockGro’s Aim For The Journey Ahead
StockGro started out with a focus on B-school graduates, as they were more likely to be thought ambassadors and proactive traders and investors in the existing market. Now it has expanded this focus to the ‘total expandable market’ of over 400 Mn millennials who need some hand-holding to participate in stock investments.
Leveraging the growing momentum for investment awareness in different asset classes such as real estate, mutual funds and more, Stockgro is aiming to reach $10 Mn revenue by the end of this financial year.
According to an Inc42 Plus analysis, fintech is the investor favourite in India’s startup hub, Bengaluru, bagging 19.1% of the total funding deals poured in the city. A further research revealed that, in H1 2020, out of the total funding in fintech, investment tech’s share stood at 12.9%. However, the interest in the sector is witnessing a rise, which is evident with startups such as Goww, raising $30 Mn from Y Combinator’s Continuity fund and Zerodha claiming the unicorn status.
Tapping this rising interest, StockGro aims to raise more funds to increase its reach and penetration. It also claims to be attracting interest from some marquee venture capitalists and global investors to participate in the next round.
Commenting on what makes him sure of the progress of his startup in the country, Lakhiotia said, “Stockgro is committed to democratise investments. The content is generated by the people to share with the growing community of millennial investors. The unique gamified trading and investment platform is for the people exploring stocks and other asset classes for the first time. And helping them are the products and investment ideas of the people from different walks of life.”