This wealth-tech startup helps Indians invest in Google, Amazon, Facebook, and other US stocks
had a start like no other.
Incorporated in London in August 2019, the cross- border investment platform went live in India in March 2020, two days after the nationwide lockdown. “It was as good a time as any,” Founder and CEO Swastik Nigam tells YourStory.
Winvesta founders Prateek Jain (left) and Swastik Nigam
“We had many clients on our waitlist for the product, and the team had worked laboriously for six months. There was no reason to delay. We’re possibly the first-ever regulated brokerage to launch with a 100 percent remote team,” he says.
Winvesta allows Indians to invest in overseas stocks and buy fractional shares of highly-valued firms like Facebook, Google, Amazon, Apple, Netflix, Tesla, and others on the S&P 500 index.
Founders Swastik Nigam and Prateek Jain — both IIM-A grads, ex-Deutsche Bank employees, and veteran traders with over a decade’s experience in global investment banks — started Winvesta to rid Indian investors of the misconception that foreign stocks are a playground of the uber-rich.
The duo also wanted to build a platform that would let Indians own shares of global brands that they know, love, and regularly consume.
“India is now consuming tech products in a big way. It is open to FDI, travel has gone up by 100X, and people are exposed to the world like never before. But they can’t really invest in the companies they know and love. We saw a huge opportunity there for a global financial services platform that could penetrate the West in the Indian mind.”
Winvesta requires no physical documentation. The entire registration and KYC process is paperless, and can be completed on the app.
The startup is authorised and regulated by the UK’s Financial Conduct Authority (FCA). Its local office is situated in Mumbai, but Winvesta runs a team spread across four countries.
What Winvesta offers Indian users
Through a mobile-first approach to investing, Winvesta wants to be the quickest and most economical way for Indians to access international stocks.
Users can create a US stock brokerage account or an international multi-currency bank account within 15 minutes. Winvesta has no significant upfront costs, annual tie-ins, or minimum thresholds. It also promises zero-commission trading.
Prateek, Co-founder and Head of Winvesta’s America business, says,
“We’ve had unmitigated access to investing in assets across the world, and data shows that very little retail Indian wealth [only 0.1 percent] is invested beyond its shores. We want to help Indian investors own more of the world, and empower them by removing the high transaction fees that they previously needed to pay.”
In fact, Indian retail investors are so unexposed to overseas stocks that “even those who are in banking and wealth management don't invest in US equities,” the founders reveal.
Winvesta not only allows fractional trading, but also lets Indians buy international real estate, and pay for foreign education through borderless bank accounts. These accounts can facilitate transactions in leading global currencies, including USD, GBP, and EUR, at global merchant platforms.
The CEO elaborates, “Say you have $1,000 left after travel, you can re-invest that in a stock or store that in the international bank account. This ensures that the currency doesn't depreciate. [In the last one year, INR has depreciated 10 percent vis-a-vis USD.] You can continue topping up the multi-currency account at any time.”
Essentially, Winvesta looks to offer an array of wealth management services that makes building a globally diversified portfolio smooth and seamless.
In May, the startup also entered into a partnership with DriveWealth, a cloud-based brokerage infrastructure provider, to let Indian investors buy fractional shares of US companies at real-time market prices.
At the time, DriveWealth CEO Robert Cortright said in a statement,
"Investors across the world have become more aware than ever of the importance of balancing their portfolios among different assets, and we're pleased to play a role in helping to facilitate global diversification for investors outside the US through partnerships like this one.”
Business model and COVID-19 impact
Winvesta lists more than 120 foreign equities on its platform; some of the funds listed have over $100 billion in assets under management. Without divulging specifics, it claims that its assets are growing 200 percent per month, and transaction sizes are rising by 50 percent.
The startup operates on a freemium model, where it charges retail investors a flat fee of $1 per transaction after three free investments. If users want to access more equities and unlock more transactions, they are charged $3-4 per month.
Swastik says, “We’re having conversations in the B2B space for distribution with Indian partners. We expect the universe of securities to increase 10X in two months. And in two quarters, we will also launch the banking product.”
Winvesta believes that COVID-19 is “a watershed event” for investing in India.
This is because the US markets have gone back to higher rallies after tanking initially. But, Indian markets continue to be largely muted. In the decade till 2019, US stocks outperformed Indian stocks by 200 percent. “Those who invested in the US have their portfolios in better shape because the rupee has depreciated,” Swastik says.
He further explains,
“If you want to access companies like Zoom and Amazon that are rallying now, you can’t do that on BSE or NSE. That is why [Reliance] Jio is looking to list on NYSE because it gives them way more returns. They know that the consumer story is in India, but the liquidity and market story is overseas.”
Funding and the wealth-tech landscape
Winvesta has raised undisclosed angel investment from “a large set of NRIs” in the US and Southeast Asia, leading business people of Indian and British origin, investment bankers, and entrepreneurs.
It is also backed by “people who have held influential positions in policy and governments historically in the UK”, and members of some of the world’s leading law firms.
The founders say they also “have a lot of unsolicited interest from investors” and might look to raise an institutional funding round by 2021.
Winvesta directly competes with Silicon Valley-headquartered Vested, which enables Indians to invest in overseas stocks through an app, and several Indian brokerages like HDFC Securities, ICICI Securities, Axis Securities, etc., which have tie-ups with foreign brokers to facilitate overseas investments.
Even homegrown stockbroking unicorn Zerodha is in talks with US brokerages to let Indians invest abroad, its Founder Nithin Kamath had said at TechSparks 2019.
All these players operate in a rapidly growing wealth-tech sector that is projected to cross Rs 400 trillion by 2025, according to Capgemini’s World Wealth Report.
However, Winvesta is creating differentiation by blending commission-free stock-trading with multi-currency banking on a clean and user-friendly interface. Under the liberalised remittance scheme, Indians can invest upto $250,000 per year overseas.
Swastik sums up with, “We want to educate people more and more on overseas investing and enable high-quality investments. Through international bank accounts, we will also help them go beyond just financial security.”