Why did we invest in Upside AI?
What goes on in the mind before you say “Yes”. What was on his list?
Sateesh says “Our decision to invest in Upside AI was driven by the fact that the founders had the vision that questioned the normal and sought to better it, and at the same time build a radical solution to address an existing gap in the PMS/AMC Space.”
Upside AI's Platform (Tech-led Asset Management Co) uses machine learning to build fundamentals-based products to create alpha from public markets while maintaining market-level risk. Also, it uses tech to run the entire chain from client on-boarding to sophisticated investment tech to live tracking and reporting via a seamless UI/UX experience for clients.
Our decision to invest in Upside AI was driven by the fact that the founders had a vision that – questioned the normal and sought to better it, and at the same time build a radical solution to address an existing gap in the PMS/AMC Space.
World over every day, roughly 80% of all market trades are made by computers and AI is inserting itself into almost every aspect of the financial world. Algorithms are slowly taking over. Tech-led investing has seen tremendous growth globally, riding on an AI/ML-driven decision-making approach. Several existing hedge funds (Renaissance, Two Sigma), Mutual Funds (AQR), and large AMCs in the US Markets, in particular, are leading in AI/ML algorithms, alternative data, and quant trading for tech-enabled decision-making that outperforms the market.
In India, the Equity AUM is largely underpenetrated and a very small part of the overall GDP (5% compared to 75% in the US), but is expected to grow from $170Bn in 2020 to $350Bn in the next 5 years. The time is ripe, for existing and new AMCs to launch and scale new products for institutional as well as retail investors, while the Indian market grows and matures to meet the global standards.
In my interactions with amazing founders Kanika, Nikhil, and Atanuu the first thing that caught my attention is clarity about their vision and a strong belief in their products/offerings. In breaking down the decision to say “Yes” to investing in Upside AI, it was all of these in equal measure that added to my conviction
- Strong Founding team with a deep understanding of India/Global - PMS/AMC Market, Players Landscape and Gaps
- Very few existing Indian players (irrespective of the AUM Quantum) leveraging AI/Technology to build products/scale the business
- Under-penetrated, rapidly growing market with strong tailwinds and Opportunity to build a large new age Fintech Player
Endiya’s own domain expertise in the sector and our ability to add value, in the journey (as Sherpas), most definitely added to the strength of the decision.
Today, Upside AI ranks among the top-performing PMS’ in the country delivering 71% cumulative returns since Jul 2019. In Jun 2021, PMS AIF World ranked Upside AI Multicap in the top 10 products of its peer group. On the back of performance and organic referrals, their AUM has grown by 10x over the last year.
Now, it is about enjoying the ride together and providing Upside AI all the help and support it needs to build new products that give Retail and Institutional Investors in Investors in India an experience of creating value like never before and generate upside for Endiya.