The New Disruptor
India’s first algorithm-based fintech research platform is providing investors relevant tools to make informed investment choices in the stock market.
India’s first algorithm-based fintech research platform is providing investors with the relevant tools to make informed investment choices in the stock market
Some four months ago, Mohit Batra, Co-founder of MarketsMojo, offered his company’s algorithm-based research tool for stock market investing to Motilal Oswal Securities. Ajay Menon, MD & CEO- Retail Broking & Distribution at the financial services firm, didn’t need much persuasion to avail the services of MarketsMojo in an environment of increasing costs and shrinking revenues. With the product adding value to the clients of Motilal Oswal Securities and bolstering their portfolio, the Mumbai-based brokerage has decided to make the service live for its clients. “It (MarketsMojo) is helping us to offer more information on stocks and their fundamentals to our clients. Today clients have been demanding more information on companies and MarketsMojo, given our fundamental research focused on around 220 companies, will add further value to our services,” says Menon. MarketsMojo enables Motilal Oswal to offer information on more than 4,000 companies to its clients. The algorithm mainly runs on past data. It also provides an indicative view on the future performance of companies. “Clients will be able to view this information along with our research recommendations (of our covered companies) through our trading app and web-trading portal. They don’t have to visit multiple portals to fetch the information useful for their decision-making,” adds Menon. What makes MarketsMojo an interesting proposition for leading brokerages? MarketsMojo helps in making investment decisions by breaking down information on each stock under three basic parameters – quality, valuation and current financial trend. It analyses over 30 million
data points daily across market movements, fundamental research, expert recommendations, portfolio strategies and other factors that have an impact on an investor’s decision-making process. It started as a go-to investment platform for individuals only, but is today an integrated application programming interface (API) for financial intermediaries. “The USP of MarketsMojo stems from factors like unbiased research, in-depth and personalised portfolio analysis and constant enhancement of research and algorithms,” says Batra.
MarketsMojo was launched by Batra and Joyson Thomas, both investment professionals. The two, who have known each other for nearly two decades, believe that there is a dearth of financial innovation in the country, depriving people of an opportunity to make money. While working for the financial portal moneycontrol. they realised that incisive analysis of the stock market is available to only a privileged few. Retail investors generally get the short end of the stick and end up losing money. Thus, it was a planned decision by the two to come together and start MarketsMojo in an effort to present an unbiased perspective of the markets to the common Indian. Thomas was the CEO of moneycontrol. com, prior to starting MarketsMojo.
In December 2014, Batra and Thomas decided to start a venture with the objective of using their varied experience to provide a fresh view of looking at the market – analytical, data-driven and unemotional. “Our goal was to provide retail investors with relevant tools to make informed investment choices,” says Thomas. Within three months of finalising their plan, the duo roped in Haresh Chawla, ex- CEO of Network 18, to come on board as mentor and founding investor. A few of their colleagues from moneycontrol.com – Karan Batra (Chief Product Officer), Rohan Thale (Chief Technology Officer) and Rageesh M (Head of Technology) – also joined them to form the core team.
With an initial corpus of `4 crore, they started operations of MarketsMojo in March 2015. It was in mid2016 that the venture raised a small tranche of `2 crore from a close friend of Batra and Thomas by diluting 3 per cent stake in the company. It gave the company a valuation of $10 million (`66.67 crore). Today, the founders hold 70 per cent stake in the company. So, what makes MarketsMojo special? “No player in the market provides similar information. Today, MarketsMojo has close to 1,40,000 registered users with nearly 50,000 users visiting their site daily,” says Thomas.
MarketsMojo signed Kotak Securities as their first client a few days after their launch. “Unlike HNI and institutional investors, retail investors want information than advice and the wide spectrum of companies covered by MarketsMojo helps us provide information to our customers,” says Kamlesh Rao, MD & CEO of Kotak Securities. So far, MarketsMojo generates revenues through B2B tie-ups. It has three products – Content, Portfolio Optimiser and Dealer Smart – and each is priced at `50 lakh. “We have tied up with some of the biggest broking houses in the country to enhance their business revenues and help their clients maximise returns. To achieve this, we are offering three solutions which include research intelligence, portfolio intelligence and dealer intelligence,” says Batra. The company recorded a top line of `4 crore and a profit of `1 crore in 2015/16. “We are on our way to reach our target of `5 crore of profitability for FY2017/ 18. Currently, we are in talks with six to eight players, and this year our B2C revenue model will also kick off,” says Batra. To create awareness about their products, the MarketsMojo team is looking at increased marketing spend and strategic partnerships and tie-ups.
While MarketsMojo tracks companies closely, some analysts argue that they can’t capture and identify multi-baggers of tomorrow. But Thomas begs to differ. “We disagree. In our Mojo stocks section, we have displayed results of our back-tested model. The market cap agnostic portfolio has generated more than 1,000 per cent returns in the last five years against top mutual fund returns of about 175 per cent in the same period. This is the most sought-after section on the site.”
It remains to be seen whether MarketsMojo can create a disruption in the broking industry. But one thing is sure – the profit-making fintech company has created a platform which is simple and user-friendly, making it possible for millennials and first-time investors to learn about investing in stocks. ~
The profit-making fintech company has created a platform which is simple and user-friendly, making it possible for millennials and first-time investors to learn about investing in stocks