Groww, an Indian investing app, has witnessed 200 percent growth in first-time investors in 2020. This massive increase in user base is attributed to the opportunity created by lockdowns and the digital revolution spurred by the COVID-19 pandemic. Groww aims to simplify complex financial products in India especially for first-time and young investors. The Groww app allows users to invest in fixed deposits, stocks, gold, mutual funds, and develop a savings portfolio. The company says that the young audience is keen on investing and Groww has witnessed a 226.12 percent increase in the number of first-time investors from the age group 18-20 years, whereas in 2021 there has been an increase of 101.65 percent till now.

Pune, Mumbai, Bengaluru and New Delhi are the top cities that have witnessed consistent growth over the last two years in terms of the number of young investors who have started investing in financial products, Groww says. In addition, Pune tops the list across all the investment portfolios except IPO, for which Ahmedabad takes the lead. Groww is working on new products, features and updates that are focused on consumer’s needs and will announce more in the future.

Expert opinion: TechArc chief Faisal Kawoosa says, “These platforms add a great value than only going with brokerage firms. These platforms know a lot about user behaviour as they rest on their smartphones and hence can leverage that understanding to decide the best investment portfolio.  Also, they leverage data using AI and other such enablers to bring in a lot of value for them. Brokerage firms don’t have that granular level of insights about the users.”

Gadgets 360 spoke to Neeraj Singh, co-founder and CTO, Groww to know a bit more about the company’s journey so far and its future plans.  

1. What were you doing before you began Groww?        

I was with Flipkart where I joined as a level two software engineer and soon moved to a managerial level. I worked on supply chain products such as Warehouse Management, Order Management, etc.  In my tenure with Flipkart I also built a few teams like Seller Platform in Market Platform, Returns & Refunds where we streamlined the product exchanges process. In 2014, we started with Motorola E, where people would buy a new phone in exchange for an old phone.  By this time, I had the experience of setting up new teams from scratch and delivering whatever was needed. The last project I was associated with was called Flipkart Quick or F-Quick. We were a team of 30 engineers. It was a hyperlocal delivery model where one can ship groceries or any product within a locality. We built the product and tested it in the Koramangala, HSR, Electronic city area. The product is still being used by Flipkart.

2. What motivated you to begin Groww? How did you and the other founders meet?    

My journey in Flipkart was entrepreneurial in nature. I had set up the engineering teams from scratch and built scalable products. It was something I was comfortable with and hence I did not carry such hesitations and did not have any financial reservations either. It was at Flipkart that I connected with Lalit Keshre, Harsh Jain, and Ishan Bansal. We would use our personal time, whether during breaks or over the weekends, to brainstorm ideas for our startup. We knew what we did not want to do but were hunting for that eureka moment to finalise our startup idea.

3. Explain in brief what Groww is about and how it helps users?  

Through my eyes, Groww is all about helping users manage, save, invest and transact money. Any financial institution runs on the back of users’ trust. We are working to build a trusted platform, ensuring the safety of users’ money. By nature, Indians are risk-averse so from day one, we have been working towards giving a safe and seamless platform to our users.

4. What was it like in the first year of being in business? What are your key learnings from the early days?     

The first year was about understanding the users and building the product. One of the insights that we learnt was that 40 percent of the users use the internet, including from metro and tier 2/ 3 cities. According to a report, 220 million people will have access to the internet by 2025. Those people who have access to the internet can make investments but they still do not. Users wanted full control of investments so we wanted to enable a DIY investment economy for them. Our focus was to build a platform that was simple to use and gave easy access to investments. Additionally, goal-based investments are a myth and not followed by many.  We observed that people did not link their investment choices or period with their life milestones.

5. How was it like sailing through the unprecedented COVID-19 crisis?   

Every crisis is an opportunity. Like many others, it has done well for our business. A lot of people utilised their time to learn about investments. Some key insights are:

• There has been a consistent spike in the number of new investors entering the space since 2020. We have seen 206.08 percent growth in first-time investors in 2020 and a 94.53 percent growth just within the two quarters of 2021, which is expected to increase manifold in this year, indicating that newer investors are entering the ecosystem
• There has been a visible increase in the percentage of first-time investors from the age group of 18-30. The year 2020 witnessed a 226.12 percent increase in the number of first-time investors from the age group 18-20 years, whereas in 2021 there has been an increase of 101.65 percent already till date and growing. This has been the highest among all the other age groups, indicating that millennials and younger investors are taking interest in wealth creation at a younger age
• Women investors entering the space has witnessed an uptick since 2020 and has shown a similar trend in 2021 as well indicating rising interest among women investors across all financial portfolios

6. In which year did Groww make considerable progress? Could you offer more details on what happened through that year?    

In my opinion, we have been making progress every day and every day is a celebration. As and when there was an increase in the number of customers using the Groww platform, it was a cause to celebrate for us. We are honoured to see this increase on a regular basis. This is a validation to our vision and efforts of becoming and remaining a customer-centric business. If we are able to make our customers happy throughout the year, I believe that year to be a fruitful one.

7. What was the thought process while building the Groww UI? Would a first-time investor understand the stock and MF jargon?  

Eliminate clutter for the customers to let them think. This saves time for customers and does not drive them away from making investment decisions. With time, attention span has reduced. We want to make sure that the decision-making process is shortened for the customers. Clutter-free, simple to use and minimum steps to get to the final stage were the key themes around which we developed the Groww UI. We provide all the relevant information that will help them understand how a particular investment product works. We have placed the information in such a way that users don’t lose their patience in finding their way to the information. Rather we have developed the look and feel to offer a clutter-free page. For a user who is proactively looking to understand investment products to make a decision, our clutter-free page will help them find their way.

8. Can an existing trader get onboard Groww? If yes, how? 

For existing investors, only two things are important – how fast one can open an account, and whether they can move their existing investments to the platform. On Groww, the onboarding journey is less than a minute. This indicates seamlessness in the procedure. However, we continue working on making this experience even better and are aiming to introduce ways to make this process even simpler in the coming days.

9. Could you help give a sense of how far Groww has come in these few years? From when it began to where it is now.  

As I am a tech and product guy, let me share my version of growth.  Launching Groww in 2017, we initially started as a regular mutual fund distribution platform with only three mutual funds on the Groww website. It took us two months to build the first version.

As a team, we were confident enough to build the initial product and we worked with the same capacity for more than 6 months. In these 6 months, we were also heavy on the experimentation front. We built MVP for various features — customer profiling, Robo advisory, risk analysis along MF transactions. We did rigorous testing with users and kept on learning.

Our journey is based on continuous learning and improvement. Keeping user experience in mind, we kept adding or retaining the necessary features and removed the ones that were not helping our users.

We made a major change after 6 months where we dropped lots of features like Robo advisory, customer profiling, and moved from just 3 mutual funds schemes to having all mutual funds and all AMCs. We moved to direct mutual funds on Groww in early 2018.

We did this because our users loved what we built and they wanted more flexibility and more MF options to buy. All major upgrades we did so far were done based on what customers were looking for.

Following user demand, we added stocks on our platform in the early half of 2020 and the same year launched digital gold, ETFs, Intraday trading, IPOs in quick succession. We are also working on launching a lot more products, features and offerings in the months to come.

10. What does the recent IPO of Zomato mean for tech startups in India?  

In general, it is a good thing that tech startups are getting traded on the stock exchange for IPO. I don’t think people should be deriving any inferences. At the end of the day, an IPO is an IPO. One should look beyond IPO and identify the problem the company is trying to solve, across sectors. Foreign investments are coming in for these startups and good products are getting built for consumers. That’s what one should value in the companies. IPOs are unpredictable- If it doesn’t fare well, it does not mean the company is not doing good.

11. Buying financial products in the Indian market is thought to be a complex affair. What is Groww doing to simplify that and make investing a simple affair? 

Every step we take is towards simplifying this affair. Groww is building a full-stack platform supporting the entire journey of an investor. We offer a place for an investor to not only gain knowledge and invest but also, reach out to someone if they get stuck anywhere. For example, when Franklin closed 6 schemes, investors did not know who to reach out to. We are working towards automating solutions for every possible challenge, situation and requirement, that can become time-consuming or a hindrance for a customer, and further delay the process of making investment decisions.

12. Could you offer data on the kind of users on your platform? What is the average age of users that invest in stocks and mutual funds in India? 

First Time Investors:

• There has been a consistent spike in the number of new investors entering the space since 2020. We have seen 206.08 percent growth in first-time investors in 2020 and a 94.53 percent growth just within the two quarters of 2021, which is expected to increase manifold in this year, indicating that newer investors are entering the ecosystem
• There has been a visible increase in the percentage of first-time investors from the age group of 18-30. The year 2020 witnessed a 226.12 percent increase in the number of first-time investors from the age group 18-20 years, whereas in 2021 there has been an increase of 101.65 percent already till date and growing. This has been the highest among all the other age groups, indicating that millennials and younger investors are taking interest in wealth creation at a younger age
• Women investors entering the space has witnessed an uptick since 2020 and has shown a similar trend in 2021 as well indicating rising interest among women investors across all financial portfolios

​Young Investors:

• Top 5 cities from where the highest number of young investors have come on to the platform to invest
• Pune, Mumbai, Bengaluru and New Delhi are the top cities that have witnessed consistent growth over the last two years in terms of the number of young investors who have started investing
• Pune tops the list across all the investment portfolios except IPO, for which Ahmedabad takes the lead
• The majority of young investors are from Pune, New Delhi, Bengaluru and Mumbai across all the investment portfolios.  Ahmedabad makes it to the top when it comes to IPO investments, Lucknow leads for Stocks, Kolkata spearheads investment in Mutual Funds, Hyderabad is the highest for investment in Gold till date for this financial year.

Highest numbers of young women investors are from Mumbai while the largest number of young male investors are from Pune till date for the current year.

Investment in Stocks  – Mumbai has witnessed the highest number for young women investors while young male investors are leading the pack in Pune.

For Mutual funds – Lucknow saw the highest number of young women investors followed by Jaipur and Ahmedabad, whereas Bengaluru saw the highest number of young male investors followed by Jaipur and Lucknow.

Investment in Gold – Jaipur witnessed the highest number of young women investors followed by Kolkata and Hyderabad, additionally, Patna witnessed the highest number of young male investors followed by Jaipur and Bengaluru.

Investment in IPOs  – Jaipur saw the highest number of young women investors followed by Kolkata and Lucknow. Ahmedabad saw the highest number of young male investors followed by Patna and Lucknow.

13. What are the other plans in the future? Are there any new features in the pipeline?

As a technology-enabled company, we are constantly innovating. Recently, we introduced IPO, bonds, FD, ETFs. We are constantly working on and will continue to roll out exciting products, features and updates in the coming days that are focused on consumer’s needs.

14. What is the employee strength? Is Groww hiring currently?  

As the business grew, so did Groww’s family. We have doubled our strength in the last one year and continue to hire aggressively.