Behind the scenes of StashAway’s notable growth
When StashAway co-founder and CEO Michele Ferrario wanted to invest his money in the mid-2010s, he found himself staring at a problem: finding investment options that worked for him.
At the time, Ferrario was the group CEO of ecommerce platform Zalora and was seeking out ways to grow his wealth. However, he found that banks kept trying to sell him expensive investment instruments like unit trusts and investment-linked policies that didn’t meet his personal needs.
Michele Ferrario (center), CEO of StashAway, with his co-founders Freddy Lim (right), and Nino Ulsamer / Photo credit: StashAway
“Michele was looking at how to invest his money, but what he saw was that you needed a really high net worth to have a proper investment strategy,” shares Nandini Joshi, StashAway’s chief operating officer. Ferrario had learned that investing was largely inaccessible to the average individual and required either large amounts of time or money.
Frustrated, the CEO began looking at alternatives. In his search, he learned about US robo-advisor Betterment, which Zalora’s largest shareholder, Kinnevik, had invested in. Ferrario’s interest was piqued, but his attempts at finding a robo-advisor in Singapore fell flat - there were none in operation at the time.
Having identified this opportunity in the market, Ferrario made the decision to bring the service to Asia, eventually incorporating StashAway in Singapore together with co-founders Freddy Lim and Nino Ulsamer in 2016.
Build and grow
StashAway’s key product is its investment platform, which helps users invest in a diversified portfolio based on individual risk appetites and investment goals. It uses its proprietary economic regime-based asset allocation (ERAA) framework to reoptimize and rebalance each investment portfolio - all while charging users a small annual management fee of just 0.8% on their first S$25,000.
“The ERAA framework is fully algorithmic, built from the investment experience of the team,” Joshi explains. “What the algorithm allows us to do is to really provide that expertise to people at scale, whenever they need it and wherever they might be.”
Nandini Joshi, chief operating officer at StashAway / Photo credit: StashAway
As the first of its kind in Singapore at the time, StashAway was fighting a unique battle: When it was starting out, it couldn’t officially launch a product or onboard any clients until it received its capital markets licence from the Monetary Authority of Singapore. As a result, StashAway had to spend its early days iterating its products using mockups and inviting potential clients to its office to view the platform, as opposed to the typical startup approach of building a minimum viable product and getting public feedback.
In a LinkedIn post from January 2021, Ferrario described this initial process as “cumbersome and slow.” However, when StashAway was finally granted its licence in mid-2017, it was able to launch with a fully developed product thanks to its early work.
The firm has grown significantly since then, having raised US$61 million in disclosed funding. It is now present in four markets and has expanded beyond its initial investment product into other offerings.
Achievements unlocked
After four years in business, StashAway has had some notable achievements.
Earlier this year, the firm was recognized as an innovative leader in Singapore’s tech ecosystem, having bagged the Bronze award in the Most Promising Innovation category in the 2020 edition of the Techblazer Awards. Organized by the Infocomm Media Development Authority with Singapore's tech industry association SGTech, the Techblazer Awards is Singapore’s top accolade for tech innovation.
“We saw what the Techblazer Awards represented, and we felt like it was an opportunity to showcase what we have done as a part of the tech ecosystem,” shares Joshi.
Winning the Award, the COO says, helped reinforce StashAway’s credibility to partners and investors and emphasized to stakeholders that the firm is doing something right. It also opened doors when StashAway was raising funds early this year.
”With the Awards, we could share that we are a leader in the industry, and that helped start the conversation [with potential investors] at a different level,” she says. The firm raised US$25 million in series C funding in April, with Sequoia Capital India - a new investor in the firm - leading the round.
StashAway Singapore and Tech team on a trip / Photo credit: StashAway
Winning the accolade was also a tremendous morale booster for the StashAway team, especially in the face of the pandemic.
“It was a nice way to bring recognition to the team and show that their work was valued not just by our clients, but also by the industry,” adds Joshi.
Aside from its success at the Techblazer Awards, StashAway hit another milestone in January 2021, when it announced that it had over US$1 billion worth of assets under management. The firm is the first robo-advisor in Southeast Asia to achieve this figure, making it the largest player in the space. It’s also a notable achievement in a region where 46% of financial wealth is kept in bank deposits.
For Joshi, what’s important about this figure is not the actual amount per se, but the trust that people have in the company.
“[This achievement] came about because every day, thousands of people are trusting us,” she says. “It’s not just new people coming on board with us, but existing customers who consistently put in money and look to us as the primary place to build wealth in the long term.”
Getting its name out there
As one of the first robo-advisors in Singapore, the company had to work hard to convince both potential investors and customers that it was the real deal.
While raising seed funding had been straightforward, the co-founders spoke to hundreds of investors before finally securing backing from Asia Capital & Advisors (ACA) for its pre-series A round. Once ACA was on board, subsequent rounds went a little easier.
Customers, however, were a different story.
“In the early days, the co-founding team would speak one to one with a lot of people to explain how they saw the problem and what they were solving,” she adds. “We did roadshows, pop-ups - really just putting ourselves out there in front of the clients so that they understood who they’re trusting.”
The StashAway office in Singapore / Photo credit: StashAway
The company also made sure to double down on the customer experience front, working to resolve customer queries as quickly as possible.
“It’s things like ensuring that we’re picking up the phone in eight seconds, answering questions on WhatsApp or emails reasonably quickly, and ensuring that there is a face for people to talk to, so that people see that there is a real delivery of service,” explains Joshi.
Once StashAway had gotten people onboard with its platform and built trust with its initial base of customers, it was able to benefit from word of mouth.
“People identified with the problem and saw that the solution fit so well to address this problem that they had been facing, and that made a difference,” shares the COO.
Getting bigger and better
The journey has only just begun for StashAway. The company has bigger ambitions, with more expansion plans and new product lines in the works.
“We continue to be very focused on helping people build wealth for the long term, as we go into new countries and continue to innovate,” shares Joshi.
StashAway is currently gearing up to enter Thailand, which will be its fifth market, and has recently launched several new products, such as Workplace, its business-to-business service, to provide retirement and savings solutions to corporate employees.
Ultimately, StashAway’s goal is to be able to address all the investment needs of its customers, no matter where they are or what stage of life they’re at.
“The question is: How can we be more and more relevant and be of better help in the long-term journey of our clients?” concludes Joshi. “There’s still a lot to do.”
The Techblazer Awards is Singapore’s highest accolade for tech innovation. It recognizes Singapore-based organizations that have exemplified the spirit of innovation in their development of tech products and services or their use of tech to achieve excellence.
Winners also enjoy publicity and business networking opportunities, including participation in SGTech and IMDA programmes both locally and overseas.
If your company has developed or adopted an innovative tech product or solution, submit your nomination to this year’s Techblazer Awards by August 13, 2021.
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*This content was produced by Tech in Asia Studios, which connects brands with Asia's tech community. Learn more about partnering with Tech in Asia Studios.*
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