CashRich, an application which provides wealth management service, has raised $1 million angel funding from UK-based investors which remains unnamed. This is the second angel funding round as the company had earlier raised Rs. 3 crore funding from undisclosed investors.
The capital raised in this round will be used by the company on further automation of its flagship technology feature Dynamic SIP, CashRich said in a statement.
Dynamic SIP aims to guide retail investors in a systematic way to allocate their money in both fixed income and equity. The model considers a user’s risk profile (behavioral finance aspects) and not just relative market valuations. It also offers an option of using an index fund.
Sougata Basu, the founder of the CashRich app, said:
“Be fearful when others are greedy and greedy when others are fearful. – Warren Buffet” Though this advice is logical, it is rarely implemented. Retail investors often panic during market crisis, and fail to capitalise on investment opportunities due to psychological reasons. Dynamic SIP uses automation to implement this advice.
The CashRich app was launched in mid-2017 by Sougata Basu, who previously worked with Tata Steel. According to the company, Dynamic SIP is an improved version of the Systematic Investment Plan (SIP) of a mutual fund and it follows billionaire investor Warren Buffett’s advice.
The company’s founder said that CashRichDynamic SIP with Index Funds uses a liquid fund and a low-cost broad market index fund for lower-risk automated investments. The startup claims to have around 90,000 users for its Android and iOS apps.
In this space, CashRich competes with the likes of Groww, Wealthly, FinCash, Nivesh.com, OroWealth, among others. Other startups that have ventured into the online sale of financial products include Scripbox, Upwardly, and RupeeVest, among others.