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Indonesia’s growing number of retail investors is due to the expansion of domestic investment platforms such as Bbitt, Barexsa and Ajaib.
Amazing, for example, within a year of its launch, it has become the third most popular investment platform in Indonesia, says App Annie. It all started in In 2018, Anderson Sumarly, At the time, he was a member of the Boston Consulting Group (BCG) and a part-time investment consultant. Struggled to maintain the volatility of the stock and bond markets.
“I was so busy that I did not have time to keep up with the changes. [in the investment market]But I wanted to invest. Obviously, the problem was not just me. Many of my peers have had the same problem, ”said Sumerley, the founder and CEO of Ajaib. CASIA.
Sumerli founded Ajaib during a MBA program at Stanford Postgraduate Business with Thai classmate Yada Piajomkuwan. Both had financial consulting experience, and Piajomkuwan also worked as a consultant for McKinsey.
Summerly is a US-based trading platform inspired by other online brokers around the world, including Robinwood and Brazil XP Investment. The goal was to create a platform for young people to start investing with the convenience of their smartphones.
“I started Ajaib to create a first-of-its-kind mobile-based trading experience for millennial investors in Indonesia. Amazing combines an easy-to-understand interface with in-app learning for thousands of years. ”
The two brought their business projects to the US-based launch incubator program Y Combinator and were accepted as part of the Winter 2018 Bach. A.D. In 2019, Ajaib — which means brilliant in English — began his career in Indonesia.
Lowering the entry barrier for new investors
Investment has traditionally been seen as an activity for the rich and powerful. The belief is that investors should have a large amount of disposable income and enough time to control the volatile market. There is an option to hire a stock broker or financial advisor, but that will cost more.
For the first time, most millennial investors are stumbled upon by such obstacles and beliefs, Summerly said. “The intervention of retail investors in the country was low because stock trading is typically only for individuals who can buy high commissions when working with offline brokers for high net worth individuals.”
It allows start-up investors to buy investment products with minimal purchase requirements such as stocks, mutual funds, cash markets and fixed income securities. Users will be provided with important information about the shares in the app such as historical data, damage rate and other important details.
“We do not use consulting algorithms in our product. Instead, we believe in providing consumers with as much information as possible to make informed decisions.” Sumari says.
Amazing a Broker fee Between 0.13% and 0.15% when buying shares, and between 0.23% and 0.25% for sales activities. The company does not charge commissions for joint fund transactions. “The bigger your transaction, the lower the fee,” Sumari said.
The platform has over 1 million users, 80% of whom are under the age of 30. Currently, Ajaib only works in Indonesia, but Expansion to other Southeast Asian countries is not out of the question, says Sumerley Piajomkuwa’s home country has great potential.
Developing financial knowledge
In January, Ajaib closed the $ 25 million A-round series with Alpha JWC Venture and Horizon Venture. A large amount of new capital will be allocated for the company’s educational campaign #MentorInvestasi, which is translated as “Investment Advisors”.
“To support the government’s efforts to educate on investment and financial planning for thousands of years.” Sumary said.
The campaign is primarily aimed at young Indonesian retail investors between the ages of 18 and 30 who live in urban areas. According to the Financial Services Authority (OJK), the number of such investors will reach 4 million by 2020, which is 56 percent more than in 2019, thanks to the expansion of domestic investment applications.
However, OJK found that Most new investors do not have a basic knowledge of the stock market, while others get financial information from reliable or impartial sources.
The country has experienced borrowers from online lending platforms to buy shares. Or mutual funds, putting you in serious financial trouble. Others have listened and bought shares sponsored by prominent religious or political figures, which has not been financially successful.
OJK advises new retail investors to avoid these practices, as they will cause more harm than good in the long run. Ajaib has been supporting OJK’s advice on social media channels and in-app educational articles. The company has worked with South Korean actor Kim Sion-Ho as its ambassador. He is well known in Indonesia as an investor and consultant in the Netflix series Start Up.
Ajaib works with Indonesian Stock Exchange (IDX) on financial literacy initiatives Millennials living in districts with low financial and investment knowledge.
The program has two options: Sekola Passar Modal (Capital Market School) gives participants the opportunity to learn basic knowledge of the stock market, such as how to open an account on IDX, basic market and technical analysis and more. Tips. The online and offline one-day program has two beginner and intermediate levels, and participants can join for a fee of IDR 100,000 ($ 7).
The second alternative is called the Investment Gallery or Investment Gallery, which is similar to the Capital Market School, but classes are offered directly in partnership. Universities such as Multimedia Nusantara University and Mohammed Malang University.
“I believe in the power of the millennium in Indonesia. I believe that the millennium of Indonesia’s capital markets will grow in the near future. Education is very important to make Indonesian youth aware of the importance of investment from an early age, ”Sumarly said.
“The end of our goal is to contribute to increasing financial inclusion in Indonesia,” he said.
This article is part of KrASIA’s “Beginning Stories” series, where KrASIA writers talk to the founders of technology companies in South and Southeast Asia.
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