An innovative investors’ club is helping millennials get their share – and now, it's just received a $4 million injection from Trade Me, who is now their biggest shareholder.
“Of the 4000 or so people we talked to, 99.5% cent wanted to invest in the sharemarket but didn’t know how,” says Brooke Anderson, 30, one of the founders of Sharesies. “They felt they had been priced out, jargoned out and left out of investing.”
Like many of her peers, co-founder Sonya Williams, 29, believed the sharemarket was for “rich white guys in suits” and that people needed “heaps of money to invest”.That’s why Williams hit on the idea of democratising investing for her generation. “Sharesies allows anyone to have a crack at investing, so whether you have $50 or $50,000 you can have access to the same investment opportunities,” she says.
The pair, along with their partners Leighton Roberts and Ben Crotty, and three other founders, also wanted to change the Kiwi narrative of property being the only real investment. “With house prices rising and ownership becoming less attainable for our generation, we need to find an alternative way to invest our money,” says Williams.
Both Williams and Anderson come from marketing backgrounds. And although neither had any real experience with shares, they were encouraged by Roberts, who’d started an investment club when he was 17. “Leighton and 13 of his friends and family committed to saving $50 a week and since then they’ve invested in everything from commercial property and a herd of cows to a chicken farm in the Philippines,” says Anderson. “He showed us you don’t need a lot of money to invest.”
To join, Sharesies is free for the first month and after that, members are charged between $1.50 per month, up to $30 per year depending on portfolio value. Members can start investing from a minimum of $5 into one of six NZX Smartshare portfolios. They can buy and sell shares as they wish, committing to regular automatic payments for further investment or one-off amounts as and when they like.
Late in 2016, the Sharesies team was accepted into the Kiwibank Fintech Accelerator programme, giving them access to financial mentors and $20,000 funding, which they used for legal fees and ironing out complex regulatory issues. Since the start-up launched last June, around 26,500 New Zealanders have invested between $5 and $150,000. Investors are aged between 18 and 88, with about 80% under 40, and Sharesies now has around $19 million under investment.
Despite recent volatility in the sharemarket, Williams believes shares are still a good investment, as the market tends to rise in value over longer periods. And there’s a silver lining for buyers, of course. “The price of shares is cheaper due to the dip.”
She and Anderson are further developing the range of investment offers, including sustainable investments and mutual shares, as well as increasing their focus on educating investors. “We want our generation to understand the risks and the rewards of investing, as well as how the sharemarket works and how it can work for them,” says Anderson. “And to get more satisfaction from investing $20 than spending it on smashed avocado on toast,” laughs Williams.
This article was originally published on 15 July 2018 and was updated in October 2018.