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Kristal.AI aims to be every investor's 'first private bank'

Jovi Ho
Jovi Ho8/17/2022 11:35 AM GMT+08  • 8 min read
Kristal.AI aims to be every investor's 'first private bank'
To serve the mass affluent market, Chanda co-founded Kristal.AI in 2016. The digital wealth manager targets accredited investors who have been ignored by big-name private banks. Photo: Albert Chua/The Edge Singapore
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After spending more than a decade at various financial institutions, Asheesh Chanda says one particular scene in the 2015 Hollywood Wall Street movie, The Big Short, encapsulates his founder journey.

In the film, eager upstarts Charlie Geller and Jamie Shipley tell a JPMorgan Chase executive that they manage a “phenomenal” US$30 million ($41.5 million) and would like access to high-level trades — to sit at the “big boy table”, as the film describes.

They then learn that they are still US$1.47 billion short, and the meeting is over in less than a minute.

For Chanda, who was formerly at JPMorgan Chase, the scene captures a “glaring problem” of the wealth management industry, which is to serve the best interests of just the ultra-rich. “The richest person gets the best deals, the best pricing, the best access, the best platform and bank accounts, and so on. They also get to invest in the best funds, which are getting the best returns,” says Chanda in an interview with The Edge Singapore.


That’s the reality of life: investors who have smaller-sized net worth are not being serviced well or taken care of.

That gatekeeping hits both ways, says the former banker at Citibank India and BNP Paribas. “At the same time, there are many budding fund managers, upcoming funds and new talent who are not able to attract capital — people like all of us who don’t make the cut to get a seat at that table.”

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The 43-year-old adds: “That’s the reality of life: investors who have smaller-sized net worth are not being serviced well or taken care of, and budding talent are not getting the audience to showcase themselves.”

To serve the largely ignored mass affluent market, Chanda co-founded Kristal.AI in 2016. The digital wealth manager targets accredited investors who typically do not qualify for an account with the big-name private banks. “We launched Kristal.AI as the first private bank that investors should experience,” he says.

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Access, curation and fractionalisation are three main ideas behind Kristal.AI, says Chanda. From just US$10,000, accredited investors can invest in private assets, mutual funds, automated portfolios and even crypto and blockchain assets through the Singapore-headquartered company.


With $100,000 or $200,000 on Kristal.AI, you can access everything that someone with $20 million can get.

By breaking down large ticket sizes, Kristal. AI’s customers are empowered to invest, says Chanda. “If you take $2 million and go to any private bank on the street, they won’t even open an account for you. But with $100,000 or $200,000 on Kristal.AI, you can access everything that someone with $20 million can get.”

Given the heftier investment sums, a hybrid or “bionic” model works best for Kristal. AI, says Chanda. “If you’re investing $1,000, you may just send the money and start your investment journey. When investing $100,000 and going completely digital, however, there’s always a fear in the client’s mind that if something were to go wrong, whom do they call? I think it’s very important to get that human touch available.”

Chanda estimates that client support is “80% technology and 20% human-driven”. He proudly shares that his customer service team is run entirely in-house. “We believe in managing the complete user journey in a cohesive manner. They’re split across different countries and we typically cover an overlap of Singapore’s and India’s time zones, typically between 9am and 9pm Singapore time.”

Today, the company has a team of 240 employees across Singapore, Hong Kong, India and the UAE, and manages more than US$500 million, with Singapore-based investors accounting for nearly 60% of this pot.

India and Hong Kong are “almost on a par” for the remainder, while investors are slowly coming on board from the Middle East as the company expands its months-old operations in the region, he adds.

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For now, the company is not looking beyond these four target markets. “The world is also a very volatile place, so you don’t want to over-extend and over-expand. Instead, you want to solidify your presence where you are,” says Chanda.

What are the mass affluent buying?

As CEO, Chanda also manages funds himself, overseeing a hedge fund strategy for founders and key clients, with expertise in rates, currencies and fixed income.

From his position as both CEO and strategist, Chanda notes how quickly investing trends have come and gone in the pandemic years.


Bonds are coming back into vogue and there are also certain other private assets that are being looked at; a lot of people have moved away from longonly ETFs.

For example, 2020 was the year Cathie Wood, CEO of Ark Invest, achieved practically cult status. In the later years of the pandemic, however, interest turned towards pre-IPO investments. “You had a lot of interest in private equity into venture capital. That was happening in the second half of 2020 and into 2021,” says Chanda.

Two years after the initial outbreak of Covid-19, the 2022 market has swung to the “exact opposite”, he adds. “If you look at this year, it’s mainly those in the ordinary space, the arbitrage funds in long-short funds, which don’t have a directional play to it … Bonds are coming back into vogue and there are also certain other private assets that are being looked at; a lot of people have moved away from long-only ETFs.”

The automated portfolios on Kristal.AI have helped save “a lot of money” for clients, says Chanda. “In January, our algorithms went conservative. Typically, a balanced portfolio deploys 60%–70% to stocks, but our algorithms cut the allocation by a third. That turned out to be a very good call.”

Kristal.AI’s investment committee also took a call in February to sell off all Russian exposure. Chanda says: “We didn’t want clients to face uncertainty around Russian assets. Whether it was stocks, bonds or whatever, we just stayed out of it.”

He adds: “When people talked about catching a falling knife, we said: ‘No, our strong advice is that you stay away from it.’ Of course, people are allowed to do whatever they want, but we are very clear and honest in our recommendations.”

Democratising investments

For many of its users, Kristal.AI may be their first taste of private banking, but the platform has also signed on more established punters. In a way, it could complement other wealth managers.

“What we realise is that the ultra-rich people think: ‘I have a Porsche and a Bentley, why not a Tesla too?’ Likewise, they have a Swiss private bank account, an American private bank account, so they want an additional private bank account too.”

On the other end of the investing spectrum, Kristal.AI’s Freedom accounts are available to all investors, even those that do not meet the Monetary Authority of Singapore’s (MAS) accredited investors threshold.

Freedom users can access digital advisory, thematic investments and automated portfolios; they are also only charged management fees of 0.3% per year after their investments cross US$10,000 in value.

MAS maintains a stringent threshold: accredited investors must have net personal assets exceeding $2 million (or its equivalent in a foreign currency), but with net equity of primary residence capped at $1 million of the $2 million threshold; net financial assets (net of any related liabilities) exceeding $1 million; and income in the preceding 12 months not less than $300,000.

While these are in place to protect retail investors from riskier assets, Chanda finds it “strange” that they largely cover legacy instruments. “The moment a new asset class is created, suddenly people are trading cryptos and NFTs (non-fungible tokens) and all kinds of things, and it takes time for regulations to develop around it,” he says.

These new asset classes are growing quickly but “no one really understands them well”, says Chanda. “There’s big money being poured into it and people are just going into it because there are communities developing around it.”

He adds: “I think there can be a mechanism to make it a lot more holistic. It should be linked to the complexity or the potential downside of the product. It should be linked to sophistication, rather than net worth.”

‘I invest for my three kids’

Chanda’s personal investing journey began when he moved to Hong Kong in 2006, just years before the global financial crisis.


The noise is created by the 10%, the winners. The 90% who lose money will stay quiet.

As an investor, he warns against being led by emotion. “The noise is created by the 10%, the winners. The 90% who lose money will stay quiet,” he says.

His portfolio of funds, bonds and REITs are based on an asset allocation model where exposure to an asset is inversely related to its riskiness.

“I’m a big believer that people should be investing in the stock market. But you definitely have to figure out what’s the next decade of growth,” he says.

In this era of deglobalisation, Chanda points to China, India, Vietnam and Indonesia as growing markets. “The 2020s is an era for Asia to come up. Europe will take a while to bounce back because of Russia, and the US is in a different cycle itself,” he notes.

With a target yield of 10% to 14% over a five- to 10-year horizon, the father of three says his investing goal is to save money for his children’s university fees.

Chanda’s “No. 1 priority”, however, is to ensure Kristal.AI succeeds. “The stock options that close to 200 people have are going to be a huge wealth creation for them … I believe money is a symptom of success, and not the cause nor the motivation,” he asserts.

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