Bt30-billion investment aims to adjust Thailand’s wealth distribution
Beacon Venture Capital, the corporate venture capital arm of KasikornBank (KBank), has announced a Series A investment in wealth-tech start-up Robowealth, which envisages total investment of Bt30 billion this year.
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The companies say the investment aims to employ the business strengths of both KBank and Robowealth to encourage ordinary Thais to enter the capital market, by solving three primary issues that currently prevent them from investing: lack of time, lack of knowledge, and lack of capital.
Beacon Venture Capital’s Managing Director Thanapong Na Ranong said his company focuses on investing in high-potential start-ups whose innovations and services can deliver real value to KBank customers, through the creation of new financial products or services. However, this is the first time that Beacon VC is investing in a start-up that already has a working relationship with KBank.
KBank and Robowealth, together with Lu International, launched the mobile application FinVest in late 2020.
Robowealth provides complete solutions for robo-advisory and mutual fund investment. Beacon VC’s investment will reinforce strong on-going business collaboration that will offer new investment tools and alternative investment products to Thai people. The companies point out that this is something that the Thai investment market needs, especially when interest rates for traditional saving products are low.
Robowealth’s Group Chief Executive Chonladet Khemarattana said his company’s expertise in wealth-tech services will help Thais to meet their investment goals more easily. The group aims to liberalize the Thai financial industry by providing ordinary Thai people with efficient investment opportunities.
Currently, only 5% of Thailand’s 70-million people invest through mutual funds and the stock exchange.
Robowealth’s vision lies in a cooperative endeavor to build a stable financial ecosystem under the concept “Empower Future Financial Ecosystem”, involving Business to Consumer (B2C) and Business to Business (B2B) schemes. This ecosystem will ultimately help Thais to achieve sustainable financial freedom.
Robowealth’s first application, odini, was Thailand’s first robo-advisor. It debuted in 2018, targeting ordinary people who were looking for a simple way to invest through automated ready-made mutual funds portfolios. The robo-advisor adjusts its asset allocation in a timely manner to match market conditions and customers’ appetites for risk. Customers can either make lump-sum investments or pre-specify monthly dollar-cost-average contributions.
Two years after its launch, Robowealth enhanced odini with a more premium service under the odini BLACK sub-brand. It was integrated into the existing odini application to better serve the mass affluent segment.
Robowealth’s second application is FinVest, a collaborative venture involving Robowealth, KasikornBank, and Lu International, a world-class fin-tech company. FinVest debuted in late 2020 as Thailand’s first curated mutual funds investment application. Its investment committee, which consists of fund managers and investment analysts, has the primary responsibility for selecting a set of suitable mutual funds, both domestic and international, based on a thematic investment framework.
FinVest serves up these featured funds directly to customers, with precise and digestible content, so that customers can make their own final investment decisions.
Robowealth also provides other services through its subsidiaries. These include high-touch wealth-management solutions from Robowealth Investment Advisory Securities for high-net-worth customers, and professional fin-tech software development solutions from Codefin company, which is behind the success of various financial institutions.
Robowealth’s Chief Executive said the effect of the COVID-19 situation allows his company’s customers to benefit from investment diversification into global markets. Its robo-advisor can provide a decent return by allocating into Chinese and US equities, among which there are many tech stocks that have greatly benefited from the lockdowns.
Additionally, the pandemic has encouraged more people worldwide to adopt digital platforms, which provides a long-term benefit for wealth-tech businesses. Thai financial institutions have also become more aware of the inevitable digital transformation, providing an excellent opportunity for Robowealth to respond to their needs through Business to Business (B2B) cooperation.
Chonladet made the point that Thailand has one of the world’s worst distributions of wealth, and said Robowealth aims to reduce that economic inequality. At present, the high cost of living leaves typical Thai households without enough money to save or invest, resulting in an increasing wealth gap between the rich and the poor. Finding effective investment channels is a big challenge for those who have no more than a little cash surplus.
Therefore, Robowealth’s core principle is to co-create a financial ecosystem that enables Thais to start investing with minimal funds through convenient, user-friendly, reliable channels – regardless of the service ownership. The service provider could be Robowealth, Robowealth’s business partner, or any other company. Chonladet said it does not matter which company gains the market share, as long as Thai people can access efficient investment channels. There should be no competition in helping people to do so.
Robowealth is also a strong supporter of financial literacy among young people, giving them the right perceptions of investment and paving the way for them to become successful investors in the future.