The Investment Platform for Non-InvestorsBy Sofía Hanna | Fri, 11/18/2022 - 11:13
Q: What added value does RUUT provide?
A: We are building an investment platform for non-investors because we know that less than 2 percent of people in Mexico have an investment account. The country has strong digital penetration in services like banking or debit where about 55-60 percent of its population already use digital banking, but this is not translating into investments. We have created an accessible platform in which most people can feel comfortable investing.
Q: Why was it necessary to facilitate the process of investing in stocks and exchange-traded funds (ETF)?
A: While there are some alternatives in Mexico for digital investment, all of them require a great deal of knowledge to choose which assets to buy. This is a big mistake in a country where most of the population is not used to talking about money; it is unrealistic to assume that people will download an investment app and start making the right investment decisions on their own. We decided to reframe that problem and simplify it, while also providing educational tools and advisory services to help users become investors through better financial decisions.
We understand that individual investment is one of the most powerful tools for economic growth, so it is highly necessary to provide this generation with more accessible financial services to allow them to make better financial decisions.
Q: What steps did the company take to develop its platform and what were the challenges?
A: It was challenging to build a quality app with our small team of 15 people. Another challenge is Mexico’s complex regulatory and bureaucratic process for the creation of wealth generation tech, which has led the field to be overlooked. We also faced difficulties in getting government entities to recognize the importance of these products. It took a large amount of time for them to understand how we are using technology, which is already available in other parts of the world. We believe we’re helping this ongoing conversation with the country’s regulator go forward and are very proud of that.
Q: What is the value in making instant and paperless investments?
A: The COVID-19 pandemic played an essential role in allowing the tech industry to reshape how the stock market operates. Before the pandemic, Mexico had less than 200,000 investment accounts. The country now has 2.5 million thanks to the abilities of digital services to tackle investment barriers.
There is an integral advantage in being able to access an entire investment ecosystem through a single phone app. For example, we can help our customers build an investment profile so they can receive advisory, tailor-made portfolios, as well as financial content and the news that interests them.
Q: How would you describe the company’s cybersecurity policies and stance?
A: Our brokerage partners in the US are fully licensed by the Financial Industry Regulatory Authority (FINRA), so they have full compliance and cybersecurity coverage for the investment accounts that are held in that country. Furthermore, all our customers' accounts are insured for up to US$500,000. In Mexico, we are regulated by the CNBV and also have tight compliance and security measures in place, so this gives our clients the certainty that their accounts are safe with RUUT. We have been careful and proactive regarding cybersecurity as we manage sensitive information.
Q: What is behind your motto “investing is for everyone” and why is this important?
A: In Mexico, less than 2 percent of the population has an investment account but, in the future, everyone should be able to have the technical or educational capabilities to start investing. There is a right way for everyone to invest; it does not have to be sophisticated, as there are many alternatives that make investing accessible. It is just a matter of framing it correctly. We are developing an investment platform for everyone. We are different from other players in the industry because we are absolutely in love with the problem and deeply understand the pain points our customers face. We want to find a way to build something that's truly innovative and disruptive and that helps people frame investment in a new way.
Q: What are the company’s expectations for the release of the full version of its platform and what can customers expect?
A: We have over 100 users in our beta version, and we are trying to collect as much feedback as possible to make the platform as friendly as possible for the official full release, which will take place at the end of November 2022. We have about 7,000 people on our waiting list. We have strong expectations because of the feedback we have received. We are making massive efforts to better understand our customers and are sure that we can convert most of that waitlist (and hopefully a lot more people) in the first months after the release of the full version of the platform.
RUUT is an investment platform that offers clients in Latin America the opportunity to invest in ETFs and US stocks starting at US$1. The platform will be launching in November.