How Tiger Global doubles down on Indian savings and investments app Jar
Tiger Global has led a fresh round of investment for Jar, an Indian fintech firm that is assisting millions of Indians in saving little amounts to invest in digital gold as it prepares to provide a number of brand-new services like lending, insurance, and mutual funds.
Jar said on Thursday that its Series B investment round had brought in $22.6 million. The funding, which included participation from Folius Ventures, Panthera Capital, Prophetic Ventures, Yes VC, WealthFront founder Adam Nash, Founders Fund principal Zachary Hargreaves, as well as early backers Arkam Ventures, Rocketship.vc, and WEH, valued the one-year-old startup at over $300 million, it said.
The first discussions of the round were previously covered by TechCrunch. Two individuals with knowledge of the situation told TechCrunch that the Bengaluru-based business, which has received over $58 million to far, is in talks with a few investors and may add a few million dollars to the round.
Despite the fact that Indian banks have created a billion accounts for customers in the South Asian market, a significant portion of people don’t have any savings. Many people are compelled to turn to friends, family, or shark lenders for financial assistance in the case of an unanticipated bill or emergency.
Confusion, according to co-founder and chief executive of Jar Nishchay AG, is a part of the reason why so many Indians never save or invest. Should they invest in stocks, cryptocurrencies, mutual funds, or other bank-sponsored schemes? As the environment around them is covered with advertisements, there are many options available, he added.
Jar is relieving the burden by providing a kind of investment that Indians can understand: gold.
(To say that Indians are fascinated with gold would be an understatement; they have a private stockpile of the precious metal valued at $1.5 trillion. Indians from all socioeconomic backgrounds have long chosen to save their savings, or at least a portion of them, in the form of gold. India is really one of the world’s top importers of this precious metal due to the high demand for the metal there (Indians own more gold than citizens of any other country).
A well-known asset class is a component of the answer. The ease with which Jar has made it possible for its customers to save and invest is its additional value proposition. According to Misbah Ashraf, co-founder of Jar, the startup offers users a variety of saving options on its self-titled app, including roundups, where the nearest round number following a transaction is automatically saved, as well as setting recurring savings amounts and carrying out one-time execution.
Since introducing the product a year ago, Jar has quickly garnered attention. According to the company, their app has over 9 million registered users and processes over 220,000 transactions daily. The business, which reported average monthly growth of 20%, claimed it spends less than $1.5 per person on user acquisition.
“Jar’s savings app has swiftly earned confidence and popularity with young earners interested in creating a saving and investing plan,” said Alex Cook, partner at Tiger Global, in a statement. “By beginning with digital gold, a well-understood and well-loved asset class in India. We are pleased by the company’s quick development and are eager to increase our investment as they enter additional asset classes.
The firm, which has roughly 90 employees, is now preparing to expand its product line. According to Nishchay, “We are constructing the most pervasive and contextual platform to assist consumers in navigating the financial possibilities without feeling overwhelmed.”
According to him, Jar is creating and testing secured and unsecured lending, mutual funds, fixed deposits, peer-to-peer loans, and insurance. It is also seeking to employ another 50 individuals. According to him, the business intends to provide these additional goods during the next quarters.
Misbah, whose family’s financial struggles served as inspiration for Jar, thinks that Jar has been successful in encouraging individuals to develop the habit of saving money. These consumers, the majority of whom, according to him, reside in rural small towns and cities, “are now ready to investigate and evaluate alternative instrument possibilities,” he added.
According to Jar, the additional financing adds three years to his runway.
In the last ten years, a large number of banks, startups, and other organisations have flocked to India in an effort to capture what many consider to be the last major growth market.
Local heritage banks and mutual funds have been attempting to market to the people of India for years. However, they have reduced the number of their customers to barely 30 million as a result of their impersonal offers and excessive dependence on the records of local credit bureaus.
Making a product is one thing, but having the ability to market it is quite another. These organisations are all skilled in manufacturing. You must be in tune with the person’s identity, quirks, anxieties, cognitive load, and cultural relevance if you want to market to them. Nishchay said in a previous interview that it is both an art and a science in and of itself.
Without mentioning the guard rails that have been put in place in advance to turn growth into a manageable output rather than an illogical vector, Jar’s growth tale would be lacking. The business balances careful execution with a high level of openness, ensuring that all stakeholders, including partners, investors, workers, and employees, are fully informed of major objectives and goals. In a statement, Rahul Chandra, managing director of Arkam Ventures, stated, “We are confident that this method is assisting in the creation of a sustainable firm with a predictable development trajectory.