#4 Founder’s Showcase: Sugar Wallet (Dev Soni and Sophia Ritchie)
This week we’re in for a treat with an inside scoop on Sugar Wallet, co-founded by Dev Soni and Sophia Ritchie.
What is the problem you’re solving, and how are you solving it?
Though we’re aiming global, but in NZ alone, 40% of Kiwis want to invest but only 16% are. This doesn’t even include those who are churning. Despite having FOMO when hearing friends’ successes, the majority want to invest, but struggle to do it.
Existing platforms don’t appeal to beginner investors as it overwhelms them with financial jargon and information. Often they underestimate the amount of mental effort required for someone new to start investing. What these customers need is a simple platform for beginners. Something that feels familiar, safe and easy — so they can finally get started.
We did extensive customer discovery last year, which included over 110 customer interviews. It helped us find a set of problems people had with saving, budgeting and investing. A discovery survey (with 215 responses) enabled the collection of more quantitative data; the participants were a mix of our network, relevant Facebook pages. A mix of occupations and employment statuses were carefully selected — from tradies, doctors to un-employed.
After rigorous analyses, including concierge tests, we found that helping people to start an investing habit was the most impactful change we could do in order to improve their financial wellbeing.
We discovered investing still feels very complicated and scary for many individuals. Even after signing up to other investing platforms, they end up only investing once or don’t make any investments at all — due to being overwhelmed with all the jargon and seemingly endless choices. People want to generate more wealth for their future through investing but are mostly not investing in anything other than Kiwisaver / Super schemes.
Enter Sugar.
Sugar is the new, simple, and hands-off way to invest. Sugar is an app that helps you automatically invest a portion of your paycheck into 1 of 3 easy investment funds. Not over-complicating it for the user. 5 minutes of onboarding and you’re now an investor, with automatic payments set up via open banking by the end of the sign-up.
We make investing options feel as easy as Super (Kiwisaver), but with full control and the ability to withdraw at any time. Most non-investors and those who buy from popular trading platforms aren’t looking for the highest returns, therefore our funds take a conservative approach that beats the bank by a long shot and focuses on stability. We partner with established fund managers: we are currently using https://simplicity.kiwi/ funds.
What do you love most about being a founder in NZ?
We think NZ is a great place to start. There’s relatively low competition in tech, it’s easy to connect with anyone, and engineering wages aren’t skyrocketing yet.
One of the things that are really changing in the last year or so, is this monopolistic behaviour that particular angel groups have had over the market. The reason why that matters is that it shouldn’t just be about who you know, or being first to market. With new VC’s, angels and all the in-between, it’s definitely changing. Another thing that’s interesting is the recent entry of experienced operators from unicorns like Mahesh and Jai; experience that is hard to access in NZ, and was previously very hard to come by. Phase One is doing an incredible job at solving both of these previous challenges with the NZ startup ecosystem.
Why are you working on Sugar Wallet? What was the trigger point that made you start working on this?
Dev: I was born in India, and moved to NZ when I was 7. I’ve gone back really often and have seen deep multi-generation poverty around me all the time. It hurts. It hurts to see someone lose out on opportunity because of what they were born into. Where you can’t necessarily just pull up your socks and live a better life. Similarly, as a middle-class family in NZ, there’s a lot we missed out on. My mum was in a default KiwiSaver the entire time, missing out on 10’s of thousands of potential gains — that would’ve taken her 5–10 minutes to change once. We never had enough money for me to get tutored in school — I often felt under-resourced in comparison to my peers.
It’s hard to pinpoint an exact trigger. I’ve always done things that try and solve different parts of this throughout my life: the most affordable custom-made suits in NZ, fashion/style advice blog for guys with all skin colours/ethnicities and now Sugar. The closest resemblance of a trigger point would be at the start of the first lockdown realising I had never been taught money, and the more time I spent learning about budgeting, debt and investing the more boring I found it. A double whammy.
I then started doing a whole bunch of early user interviews and testing with multiple problem sets in personal finance. I found a staggering amount of people who would just put money in their bank account losing on sizable house deposits to savvy investors and just pure inflation. Sometimes, they had tried investing through existing platforms… but just found it too overwhelming, boring and hard to feel like they weren’t just gambling their money away.
Life shouldn’t be drastically different for 99% of the population if one doesn’t have the money, the networks or the know-how/literacy as the top 1% does.
Hence it’s our mission to enable 99% of the world to have the same financial superpowers as the top 1%.
Sophia: For me, Sugarwallet is personal — I fall clean into the segment we are targeting, of people who know they should be investing but never seem to make the time. That was part of the reason why I resonated with the mission so much. Being able to give people that peace of mind, that their finances are sorted, is really powerful.
Previously I was a solo founder working on a music education EdTech startup, and met Dev through Phase One. We were going through customer discovery on our respective startups at the same time — and we had long chats about how to build a product that people really love. I was struggling with being a solo founder — it’s tough — and I realised my previous experience at another early-stage Fintech (Pocketful) had given me unique insight into building fintech apps in New Zealand. I made the decision to help Sugar part-time as a software developer, and about 6 weeks in, realised that I was just as passionate about Sugar as Dev. The trigger point for me was when I was on a trip to Wellington, but stayed up late every night to endlessly discuss strategy with Dev over the phone. Soon after, I made the decision to stop working on my previous startup, and joined Sugar as a co-founder.
What is the current state of Sugar Wallet? What does the product look like and what is your team focused on right now?
We’ve just launched our private beta on October the 25th; we have users! Currently, the product lets you start investing into 3 sets of managed funds every payday, by automatically connecting to your bank account and projects your possible future fruition of enabling this habit.
Our focuses are:
- Growth, Retention & PMF
- Strategy going forward — e.g. product, hiring, internationalisation
- Prepping for our Seed round early next year
What makes Sugar Wallet unique?
We think what makes us unique is our deep understanding of our customer segment, their behaviour, their mindset. Also, beyond that; thanks to Mahesh — our absolute focus on understanding the problems our segment has, and how to solve for those. Like really understanding it, and having a process behind it.
On the outside, it’s the user experience. It’s the simplest way to create an investing habit.
How are your customers doing? What is the traction like?
Our customers have gone from purely putting money into the bank to investing through Sugar. The upside for them is huge. I think an interesting challenge is figuring what their ‘aha moment’ is and in a product type, where return and long term value is typically the driver — how do you shorten that realisation and speed up the WOM cycle.
Sugarwallet has 50 customers since our beta launch on the 25th of October, actively investing a combined $100,000 per annum. Our user retention is 100%, with $4100 invested in the past 3 weeks. We’ve achieved 175% WoW growth since our private beta launch on iOS Testflight.
Some testimonials from our users:
“Basically KiwiSaver but you’re in control! Super easy to set up and monitor. Perfect for those that want to invest but who aren’t really sure how to start.”
“I tried using other popular investing platforms but I’ve just found it too much work, Sugar is the only one where I can easily set and forget”
We have 114 people on the waitlist to join the app, filtered by a qualifying survey, and 600 people on the mailing list.
What is another start-up in New Zealand that gets you excited?
Dev: I’m really fascinated by Transactional.AI. Whenever I speak to them, I come out of the room feeling dumbfounded in a good way. They have an incredible team, deeply thought out strategy, industry understanding and a clear worldview.
Sophia: I love the work that Toby and Easyrent are doing for mid-term rentals.
Who do you look up to for advice/inspiration? What’s your favourite piece of advice from them?
Dev: For me, one of the most inspiring people ever is Steve Jobs. There isn’t a particular quote I go back to. I mean there are so many good quotes, from: “Stay hungry, stay foolish” — the word choice foolish is so unusual yet so important when having done customer discovery. You fail when you think you know it all.
What I find even more inspiring are his work and his presentations. It’s hard for me to describe the amount of impact he’s had on me. Personally; I think one of the all-time greats is integrating a true understanding of people, culture and technology all in one.
Sophia: I definitely look up to my parents for advice. I’ve found a lot of parallels between the startup world and the political world, as they were part of the team that campaigned for electoral reform ie. MMP in the 90s. Although it’s a different field, I can go to them with questions about anything we are dealing with and get thoughtful advice on how to tackle different challenges. A value that they really instilled in me is to get the job done right — always put in your best effort and take pride in your work.
What would you say to someone interested in supporting or learning more about Sugar Wallet?
What we need:
- More users/growth advice and systems to measure product market love
- Strategic advice on defensibility, internationalisation and capturing value
- Evangelists and Investor connections to help us raise a mega-round
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