Jar: The Savings App That's GenZ's New Best Friend
Today, we're going to take a deep dive into a financial innovation that's capturing the hearts (and wallets) of GenZ and many others – Jar, the daily savings and investing rocket ship. 🚀
It's all about Jar, credit card market rumblings, Razorpay's global aspirations, and a bunch of funding announcements. And, hey, wasn't I just complaining about nothing exciting happening in fintech? Well, you know what they say, be careful what you wish for!
What Is Jar, Anyway?
Jar is like the Robin Hood of savings apps. Launched only seven months ago, it's making waves in the fintech world. They've recently raised a staggering $32 million in a round led by Tiger Global, valuing the company at $200 million. But numbers aside, what's so special about Jar?
At its core, Jar is a daily savings and investments startup designed for Gen Z. The app simplifies the savings process, and it does this in two smart ways. First, it rounds up users' spending and invests the spare change every day. Second, it allows users to set a small amount to invest daily.
Now, you might be thinking, "What's so unique about this? Aren't there other round-up investing apps?" You're right, but Jar takes a golden approach. Instead of investing in liquid mutual funds like others, Jar invests users' money in digital gold.
Why Digital Gold?
Investing in gold holds a special place in the hearts of Indians. Gold has deep-rooted cultural significance in India, and it's familiar to pretty much every Indian. There's something about gold that transcends language, culture, and background. Indian homemakers even have more gold reserves than the Indian central bank or the US. No kidding!
The magic ingredient, though, is that investing in digital gold doesn't require any Know Your Customer (KYC) processes up to a certain threshold. This simplicity means that users can go from downloading the app to making an investment in just 45 seconds. This gave Jar a massive advantage. Jar is like the superhero of investing and saving, swooping in to make things super easy.
Finding the Habit-Forming "Wedge"
The founders of Jar were onto something big. While other Indian wealth startups were focusing on more experienced investors, Jar spotted an opportunity to target a different audience – Gen Z. Most existing financial apps require a level of understanding that can be overwhelming for first-time investors. Jar bridged that gap by offering users a simple way to invest in something they already understand – gold. No more pondering over which fund or stock to invest in, understanding Asset under Management (AuM), expense ratios, or fund managers. Just gold, plain and simple.
Execution Is Key
I'll admit, I was skeptical at first. When I asked Nishchay and Misbah, the co-founders of Jar, about the risks to their business, I wasn't expecting the answer I got – "not being able to execute fast enough." I thought that was an oversimplification at the time. But after months of getting to know them, I've realized that execution is indeed their superpower. This team is unlike any other – humble enough to listen to advice but always grounded, always listening to what their users and data have to say.
The Golden Future of Jar
Yes, Jar's growth benefited from the bull market of 2021, but that's not the whole story. Jar, with its 4 million users and investments as low as INR 1, is expanding the market rather than just catering to the existing wealth. Jar's unique approach positions it to thrive even in a bear market. The claim may be a bit speculative, but it's based on the observation that users are likely to withdraw their investments from other asset classes except gold in the event of a market correction.
And what's next for Jar? If we look at companies like CRED, which found its wedge in credit card bill payments and then expanded its offering, it's clear that Jar is heading in a similar direction. Jar grew its user base by offering instant digital gold, and it's poised to launch a suite of high-touch financial products. The team is carefully planning to become Gen Z's go-to platform for their financial needs.
So, in this fintech adventure, it looks like Jar is just getting started. Stay tuned for more exciting developments from this amazing team. The possibilities are golden! 🪙
And that's it for this edition of Fintech Inside. For those of you seeking to dive into the fintech industry, reach out to me if you're an early-stage fintech startup founder raising funding. Until next time, happy fintech exploring!