Over 200 million people living in India use digital banking. But under 30 million invest in mutual funds and stocks. Groww is the little-known company planning to change this, and it’s getting investors very excited.
What is Groww worth?
Groww was founded in 2017 and is headquartered in Bangalore, Karnataka, India. It’s designed to get users investing in stocks, Direct mutual funds, exchange-traded funds, initial public offerings, and gold. Above all, it appears to be doing a great job. The Groww platform now sports over 10 million users and counting.
And this growing user base has caught the eye of several heavyweight investors. By last month Groww had raised $140 million after an $83 million series D funding round. Landing it an impressive $1 billion valuation.
Who invested in Groww?
Tiger Global led this latest financing round, which also included Sequoia India, Ribbit Capital, YC Continuity, and Propel Venture Partners.
Tiger Global appears to be taking a keen interest in the retail investment sector as it previously invested in both Upstox and IndWealthtoo. This is its third investment in Groww.
Groww plans to use these funds to boost its hiring, expand its product suite and zone in on expanding its financial education and awareness. Over 60% of its user base come from the smaller cities and towns across rural India, which is perfectly primed for these resources. Groww has already organized several workshops in small cities to educate and inform individuals about the world of investments and opportunities within. 60% of this target market has no prior investing experience.
One of the most enticing aspects of the Groww platform, is zero account charges. It’s reminiscent of Robinhood as users don’t have to pay a single rupee for opening an account or for account maintenance.
Who founded Groww?
Its co-founders Lalit Keshre, Harsh Jain, Neeraj Singh and Ishan Bansal are former executives of ecommerce player Flipkart. Plus Groww was seeded by Y Combinator in 2018.
Interestingly, when it first started, it grew its user base via Facebook’s (NASDAQ: FB) WhatsApp chat groups. And it still uses WhatsApp as a core part of its business.
The Groww platform has very quickly escalated into a well-loved place to learn and invest. It’s so good that even professionals are recommending it.
Mohit Daga, Practicing CA, said:
“Being a practicing CA a lot of people ask me for Mutual Funds and Tax saving funds. I have recommended Groww to them and they were very happy. It’s very informative and user-friendly portal.”
The Groww platform lists over 40 mutual fund companies including Nippon India (NSE: NAM-INDIA), Franklin Templeton(NYSE: BEN) and Tata Mutual Funds.
There’s been a global boom in interest in online investing since the pandemic hit last year. Between April 2020 and January 2021, new demat* account additions in India rose to 10.7 million, up from 4.7 million the year before.
People with time on their hands, along with the rise of easy-to-use apps such as Robinhood in the US, Groww in India and Trading 212 in the UK, have assisted in this trend.
Additional notes for investors:
- Flipkart is planning an initial public offering (IPO) in Q4. It’s India’s leading e-commerce company and is 77% owned by Walmart (NYSE: WMT).
- Robinhood is expected to IPO in the US later this year. It’s also bringing the opportunity for retail investors to have early access to IPO shares via its platform in the very near future.
- * A demat account is an account to hold financial securities in electronic form.