The 2019-20 financial year has been bitter-sweet for Raiz Invest. At a corporate level, it has been a year of remarkable achievement, both in Australia and Southeast Asia. However, this achievement has been overshadowed by COVID-19, a human tragedy that has exacted a heavy toll on many of our customers’ lives.
Australia may have managed this pandemic better than most countries. However, the second wave that has erupted in Melbourne, forcing another strict shutdown, is a reminder that we are still combatting this virus and its impact on the economy.
Throughout this pandemic, which has been with us for nearly five months, the health, safety and well-being of our customers and staff remain a priority, and we hope you and your families are keeping safe during these troubled times.
The last quarter (April-June) of the 2019-20 financial year capped a very successful 12 months for Raiz. There is no better evidence of this than the fact both Funds Under Management (FUM) and active customers rose, with FUM up 30.6% to $453.6 million and active customers up 15.1% to 223,730 during the financial year. Pleasingly, superannuation FUM grew despite the fact customers are drawing down their super by taking advantage of COVID-19 Early Release.
Revenue also rose by more than 60% (unaudited), illustrating that revenue in the Raiz business model can grow significantly faster than customer growth, in contrast to transactional financial services businesses.
This growth again highlights the customer loyalty we enjoy, which is a testament to our commitment to service and the increasing relevance of our products and services.
Raiz is a savings and investing mobile first platform, but we are also proud that our moderate (balance fund) portfolio option has outperformed the largest superannuation fund in Australia, AustralianSuper, for the past two financial years. The performance of AustralianSuper has been a bellwether for the superannuation industry.
In May, we offered users exposure to Bitcoin, a relevant alternative asset class for many of our customers, with the launch of our seventh investment portfolio, Sapphire. It is not for everyone, but we have more than $11 million in FUM and over 8500 customers using this portfolio. We will continue to expand our investment options as part of our commitment to offer the complete savings and investment package.
In Southeast Asia, it was exciting to announce in June that our joint venture subsidiary, Raiz Malaysia, had been issued a Digital Investment Management licence, and that we have started marketing our products to the 33 million Malaysians. We have more than 12,000 sign-ups, and growing, in just over a month.
Indonesia continues to grow. We have learnt a lot from our beta testing, we have attracted over 95,000 signups to the App. We are now launching the new App that includes all our learnings from the beta testing and will start introducing fees. Indonesia is a unique market, accelerating at a significant pace. The fact that we have a licence and strategic partnership relationships ensure we are well positioned to participate in this growth.
Raiz’s future has been set. The Australian business continues to be cashflow positive. We have $13 million in the bank as at 30 June 2020, and our Southeast Asian operations are up and running.
We have been tested as a company by this pandemic, but management and staff have been equal to the task. What has driven us in these past difficult months has been our customers’ loyalty at a time when many of you are experiencing real hardship.
So, let me thank you. And, please, stay safe.
Managing Director /CEO
The information on this website is general advice only. This means it does not consider any person’s investment objectives, financial situation or investment needs. If you are an investor, you should consult your licensed adviser before acting on any information contained in this article to fully understand the benefits and risk associated with the Raiz product.
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Past return performance of the Raiz product should not be relied on for deciding to invest in Raiz and is not a good predictor of future performance.