Bibit, a robo-advisor app that wants to make investing more accessible in Indonesia, has raised $30 million from Sequoia Capital India. Returning investors East Ventures, EV Growth, AC Ventures and 500 Startups also participated.
This funding is a growth round and comes after Bibit's May 2019 Series A. It brings the company's total funding so far to $45 million, chief executive officer Sigit Kouwagam told TechCrunch.
Part of Stockbit Group, about 90% of Bibit’s users are millennials and first-time investors. Like other robo-advisors, the aim of Bibit is to make it easier to create a portfolio tailored to each person’s risk profile and investment goals. Other investment apps in Indonesia tapping into growing demand for retail investment products include Bareksa and SoftBank Ventures-backed Ajaib.
Bibit claims that over the past year, it has registered more than one million first-time investors. As an example of market potential, the company cites data from the Indonesian Stock Exchange and Indonesia Central Securities Depository that showed the number of retail investors in the country grew 56% year-over-year in 2020, with about 92% of new investors aged between 21 to 40. But only about 2% of Indonesians have participated in the stock market.
Kouwagam said most Indonesians invest their money in term deposit bank accounts or leave it in low-yield checking accounts.
"Traditionally, they also invest in real estate or physical gold bars," he added, but millennial and Gen Z investors are shifting toward "higher-yielding liquid investments that are also convenient to manage and can be started with a lower ticket size."
The pandemic has also prompted more users tp build an emergency fund, with more Indonesians looking at the capital market for higher-yielding assets as an alternative to low-interest bank accounts.