A rainmaker for financial technology ideas

The Indian equivalent of popular personal financial services platforms in the US such as Mint and Wealthfront could now possibly come out of Rainmatter, an incubator being set up in Bengaluru by Nithin Kamath founder of Zerodha, the biggest discount brokerage firm in the country.

Rainmatter is a first of its kind incubator that will exclusively focus on start-ups that will develop technology products for the financial services sector.

“Apart from funding and offering well-equipped workspaces at a large facility in Bengaluru, Rainmatter will also provide mentoring and other support services such as administrative, legal and compliance for entrepreneurs to set up their start-ups,” Kamath said.

The start-ups will have access to the market data at Zerodha.

Biggest challenge

“The biggest challenge faced by financial technology start-ups, especially the ones focusing on markets, is getting access to the expensive and heavily regulated market access and data. At Rainmatter, we will help the entrepreneurs with a wealth archived market and financial data ready for crunching and analysis, real-time data from all exchanges, real-time order execution capabilities, behavioural data for research and analysis among others,” Kamath said.

Select start-ups can get seed funding of up to $1 lakh or investments up to $5 lakh. Kamath has personally earmarked about ₹35 crore to invest in select ideas and start-ups and have lined up several venture capitalists, in case there is more funding required. “We have already started getting enquiries,” Kamath said adding that Rainmatter should be up and running by end-May.

Zerodha’s recent experience of partnering with a start-up TradeLab Software Pvt Ltd, triggered the idea of launching an incubator exclusively for developing financial technology products. Zerodha is helping TradeLab, started by two alumni of IIT Kharagpur, with go to market strategy for their product Pi, an integrated trading and superior charting platform.

Filling the vacuum

Technology is a big differentiator in the way financial services are offered. “There was a lacuna of technology development in the financial space as people have not focused on this area. We see an opportunity here,” Kamath said.

Also, the start-ups will get access to the 50,000 strong retail financial users, the customer base of Zerodha for piloting their products. “Besides sharing our infrastructure and data, we will help them validate their products,” Kamath added.

Sharad Sharma of iSpirit said the market for developing financial products specific to India is an opportunity that has not been explored till date. Lot of products have been designed keeping developed markets in mind.