D. Murali and Kumar Shankar Roy

Chennai: How you use your mobile may change forever! Yes, that’s what INXS Technologies could end up doing if the fledgling company gets its way. Led by Mr Venkat Rangan, CEO and Co-Founder, the Chennai-based boutique financial technology start-up specialises in developing advanced yet simple solutions in the area of financial services. What does it do? Its latest product is ‘Market Simplified,’ a wealth management solution that allows you to access everything you need to know about your stock market investments on the mobile.

For the people on move who cannot have access to a TV or website, Venkat’s product sends alerts on stocks and mutual funds, technical charts, company news etc. He elaborates to Business Line. “The most critical driver for demand in our view is the emergence of a clientele which demands always-on connectivity. The mobile represents the best medium to cater to this segment which is growing segment which is willing to pay for such services.” The concept may be a hard-sell, concedes Mr. Venkat but he predicts that the mobile will make the already ‘reduced’ human element of a brokerage relationship even weaker. Errors will also be reduced if everything is automated. Read on to know how INXS plans to make the life of the small investor a little better, or so he claims…

Excerpts of the interview.

How has been the response to your product ‘Market Simplified’, which was launched towards the end of 2007?

We launched the service end 2007 in the US and on a beta (selected individuals test the program) in India. The focus in the US has been on the mobility aspect and we are happy to note that we have around 30,000 downloads of the same in the US. In India, the service is still free pending some business alliances that we are in the process of sewing up this quarter. A product especially aimed at independent financial advisors was launched on private beta in the US during a wealth management conference in Atlanta on April 8. The initial response has been excellent and we are looking at building on that.

Take us through the technology part of this product. Readers would like to know from where you source information, whether it would be delivered fast and whether it would be accurate.

To ensure the information is credible and accurate, we have tied up directly with the BSE for market and corporate data. The news element is also from ‘Capital Markets’ which is a recognised vendor of news and reports. Given that we do not generate in-house information at the moment, we have committed ourselves to sourcing such date only from recognised credible sources worldwide. Prompt delivery is where our specialisation lies with our web and mobile clients that are up-to-date.

What, according to you, are the key drivers for demand?

The most critical driver for demand in our view is the emergence of a clientele which demands always-on connectivity. The mobile represents the best medium to cater to this segment which is growing, and which is willing to pay for such services. Most enterprises are also looking at mobility to address their client and workforce info dissemination and management requirements.

You speak of making technological inputs available to everyone who cannot currently afford the same. Will it come cheap?

The difference is quite akin to what Salesforce.com did to the custom relationship management (CRM) space with existing expensive incumbents like SAP. I will quote the example of the Market Simplified SaaS delivery model. Imagine a small financial advisor with a hundred clients. He doesn’t have the ability to create a comprehensive web and mobile offering for his clients. In this case, he can simply subscribe to the Market Simplified service for a very small cost (zero capital expenses) and deliver a world class, customised web and mobile offering to his clients for FREE. Our great advantage is the ability to scale without huge capital costs making our services cheap and delivered almost real time.

Do you see the other providers of market information as competitors?

Any existing player who chooses innovative thinking can be competition. However, our model of technology provision allows us to even power our so called competition! Our competence is delivery, and we are open to partnering with existing players to provide them with the leap in technology at a fraction of the time and cost.

Tell us more about mobility and the convergence platform.

The future is most definitely MOBILE. We can already see a host of services migrating on the mobile. With mobiles already performing bar code recognition, the day isn’t far when people will not need credit cards anymore. The aspect of “execution” is slowly making its way to the mobile and that makes the mobile ideally poised to become the focal point of commerce. It is foreseeable that very soon the mobile will become the first means of access with the desktop serving as the backup. Our efforts in developing high performance native applications rather than J2ME apps is aimed at exactly this next generation of usage where investors will demand premium quality streaming information, analytics and secure execution capability on their mobile device.

Can you suggest ways in which retail interest in the markets can be enhanced?

Retail investors unfortunately do not have access to cutting edge investment and protection tools. With increased mobility and easy access to risk management resources, we can drive investor confidence in the markets. The stereotypical image of losing everything in the stock market needs to be changed.

The question of security always comes up when important data is exchanged is over the cell-phones. Is security a manageable matter of concern with your product?

Security is of paramount concern as far as mobile is concerned. In many ways it is safer than carrying a laptop with 80 gigabytes of critical data. Mobile applications can be secured by simple password protection making data secure. Transmission of data is also secure given that phones like Blackberry have extremely secure encryption built in. For other phones, we are using 1024-bit encryption which is the industry standard. This makes the security aspect well addressed.

Most of the times, small investors do not get to participate in rallies or exit stock positions in a correction. Some blame brokers that they are slow and did not inform them. How can your platform help people in reducing the time-lag and execute trades faster?

This is a typical scenario which can only be addressed by time-critical information available on the mobile. Add to this an advanced system of alerts that will notify the investor if anything unexpected happens to his portfolio, and we have an effective risk management system. Once mobile trading is allowed, the ability to execute a trade on the move will allow quicker trade execution.

Do you foresee a day where the whole process of executing trades reduces human involvement such as brokers?

With increased induction of technology, the human element of a brokerage relationship has been greatly reduced anyway. Mobile will make this ever more so.

Your product/platform assumes investors will want to know such a barrage of information. For the truly long-term investors, they have sources like media, websites and even independent financial advisors. Are you not looking at day-traders only as the captive users?

It is true that day-traders are bigger revenue spinners per capita due to their constant need for information. However, sophisticated long-term investors will also appreciate the benefit of being able to carry the markets in their hands, as our mobile allows them to. Besides, any investor would love the ability to customise his webpage to reflect ONLY relevant information without the clutter of ceaseless information. Our custom homepage does just that.

How large is the market for smaller investors who are likely to use the platform powered by your company?

The Depositary Participants have been adding a million accounts a year and despite any temporary downturn we expect the trend to continue into 2009. With India’s retail investor population growing at such a rate, and the US retail base also slated to grow substantially, we believe that retail is the big consumer story in the financial services sector.

Most people do not have high-end mobiles. Do you feel that even with an ordinary phone, people could benefit from your company’s technology platform?

To address this specific problem we have developed a Symbian application for Nokia which has lowered the entry barrier for using our application. However, to cater to the market at large, we have built in a comprehensive alerting system that can be set online and any alert triggered will be received via SMS. So, 5 minutes of work on the web will ensure that any activity in the markets will trigger SMS alerts calling for action. We also intend to introduce a radically advanced SMS query service for our high level alerts too to cater to this market segment.

You were saying about tying up with a large American broking firm. But that’s US. What has been the response to your product in the Indian market? Are brokers ready to be on a platform which would be non-exclusive?

The concept is a hard sell I accept. But our first US engagement came from the broker’s initiative rather than ours which makes us believe that they know what makes good business sense. The critical part is frankly to get the first broker onboard. Beyond that it isn’t a concept sale but an opportunity sale to the brokers. When the time comes, we are confident of getting brokers onboard on this platform.

Are you also identifying potential suppliers of services to enrich your offering?

Our stated position is that our expertise is in ‘delivery’ of the solution rather than creation of original content. We would ideally look to synergise with content owners and customer-facing organisations with the intention of marrying our respective core competences instead of creating islands of competences as exist today.

What are your plans for the next two years?

We plan roll-out of multiple products out of our financial platform over the next 12-24 months. We are shortly going to start syndicating our services to third parties and also build custom mobility services for some enterprise clients. Our most ambitious idea of an open Application Programming Interface (API) platform where developers from across the globe can collaborate to create financial applications (at a fraction of the time and cost prevailing today) is also being given finishing touches. I can assure you it will revolutionise the way financial applications are built and taken to market in the times to come.

How will you fund those plans?

With regards to funding, yes we are in the process of raising capital to expand our US B2B operations and take our solution across the globe and raise our strength considerably to meet the delivery challenges we foresee over the next 3 quarters.

Any specific reasons why you have opted to launch your product in the US, rather than in India?

The reason for choosing the US was simply because of the existence of the highest retail investor population in the world and higher technology adoption rate there. Besides, the B2C model there using credit card payment is well established, making our B2C foray there possible. In India, our B2C plans are built around partners with existing client ownership and built-in collection channels. On the B2B front, we are very bullish about India.

What about other geographies?

Regarding other geographies, as mentioned before, we have already identified markets in South-East Asia, Europe and Australia where we believe there are good opportunities for us and it remains our intention to spread out to these locations at the earliest available opportunity.

You guys must have invested a lot in intellectual property…

At INXS we often state our motto as “original innovation.” With that in mind we have pioneered the Open API platform design and will be the first player in this space to open it out to retail and individual developers. Our various patents reflect the innovative developmental work we have done.

As a start-up, how do you motivate your people?

Firstly, when people from established IT companies choose the cauldron that is a start-up, it reflects on their attitude and entrepreneurial zeal. We are fortunate enough to have that kind of a team where the spirit of “ownership” goes beyond mere words. Firstly, each of our team members is a stakeholder in the company making us a totally zero-hierarchical structure. We provide small but substantial perks like open Internet access, video games in office, a laundry service and a fully-stocked pantry, which go a long way in making people comfortable at work. Ultimately, true motivation can only come from complete freedom and ownership by all means which is the core INXS philosophy and I am sure this is going to take us a long way in creating leaders.

As a technology company, what cutting edge features are you integrating into your work?

Our Open API platform is a radically new development with each new product being a client of the platform. Our services are rendered on a SaaS (Software As A Service) model which drives great time and cost efficiencies. Our mobile apps are natively built for Blackberry, Palm and Nokia phones heralding a generation leap over existing Java/J2ME applications.

**

http://InterviewsInsights.blogspot.com