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In the recently held Cafemutual Confluence 2023, over 25 industry experts came together under one roof to talk about building the path to a brighter future through ever-changing dynamics, igniting innovation and creating an anti-fragile business model.
While the event had numerous takeaways, we reached out to nine distributors and MF professionals to identify those nine key learnings that form the pillars of a solid distribution model. Interestingly, each attendee introduced us to one pillar from each session.
Here is what they shared:
Pillar 1: Be a financial supermarket
Celso Fernandes, Nave Marg Financial Consultant, Goa from the session ‘Surviving & thriving in the changing world- building volume’
Position yourself as the ‘financial supermarket’ and offer clients a range of solutions including mutual funds, insurance, estate planning, tax planning etc. Also, focus on asset allocation and customized solution offerings to help investors handle volatility better and stay committed to being invested for the long term.
Pillar 2: Educate investors to keep emotions and investments separate
Joydeep Sen, Corporate Trainer (financial markets), Author, Columnist, Mumbai from the session ‘Way forward for retail investors in equity & fixed income investing’
Guide clients to make unbiased decisions by helping them analyse their emotions. Emotions and money are two different things and should never be mixed. Constant nudging and handholding help here. Also, it is important to keep reminding them that markets carry on irrespective of geopolitical events and interest rate cycles and that fundamentals prevail over the long term.
Pillar 3: Be empathetic and put yourself in the investors’ shoes
Vinayak Sapre, Financial Coach, Mumbai from the session ‘The evolution of financial advice’
Distributors should showcase empathy and put themselves in investors’ shoes to understand their clients better. This makes it easier to decode why they think or act in a particular way. After all, it is about providing solutions and not selling a product. Being a solution provider is the key to building client trust and an ever-lasting bond.
Pillar 4 - Take regulations in stride
Nisreen Mamaji, MoneyWorks Financial Services, Mumbai from the session ‘Sprinting a marathon: Keeping up with the SEBI’s Rulemaking Activity’
Regulations are inevitable and should be taken in stride. They are for collective betterment. For instance, earlier when a third party received funds it was known to that party and investors but not to AMCs. To avoid fraud at the end of the third party, the OTM (One Time Mandate) was mandated. Also, regulations bring legitimacy to business and over the years SEBI has attempted to close existing loopholes and introduce conveniences.
Pillar 5 - Deal with one AI facet at a time
Binoli Dodhiwala Jain, CEO & Co-founder, The Money Mart, Mumbai from the session ‘Impact of AI on the mutual fund industry’
Just like the game of Jenga where you take one block at a time, deal with AI (Artificial Intelligence) in a sequential manner, i.e. one facet at a time. Conversational intelligence (chat box) is a good starting point. Next, you may move to robotics process automation for improving efficiency, natural language processing for generating recommendations (like Spotify) on your website and machine learning (like Chat GPT) to aid client-facing work, in the said order.
Pillar 6 - Map investments to financial aspirations
Sandeep Bhushetty, Chatur Investments, Pune from the session ‘Creating resilient businesses’
Mapping investments to financial objectives encourages investors to stay invested till they achieve their goals. They show a stronger commitment, demonstrate more discipline and continue to keep their eyes on the mapped objective. In fact, in case of any incremental cash inflows they voluntarily increase their investments to achieve their goals faster.
Pillar 7 - Strike the right balance between actives and passives
Deepak R Khemani, Mumbai from the session ‘Emerging trends shaping the investment management industry’
While passives usually outperform in a narrow market rally, actives tend to do well in a broad rally. Until now, very few investors have an only-passives portfolio and the growing popularity of passives should not worry you. In fact, you should strike the right balance between actives and passives and use a mix of both to guide clients better.
Pillar 8 - Focus on creating a sustainable portfolio 
Rikesh Mirchandani, Mumbai from the session ‘Perfection trap’
There is nothing like perfect advice. Financial guidance changes with evolving dynamics and differs for each investor. Perfection is thus a myth and the quest of being perfect causes unnecessary stress. Simply focus on creating a sustainable portfolio instead of going after the best performers as investments are long term in nature.
Pillar 9 - Concentrate on untapped opportunities
Ronak Hindocha, CEO & Founder, IFANOW, Mumbai from the session ‘CEO panel- The Next Wave of Growth’
As against 50 crore bank accounts, the number of MF investors is only 4 crore. This shows that there are still untapped opportunities and headroom for growth. As the industry moves from the current Rs 48 lakh crore to Rs 100 lakh crore, you should ride on the back of technology to reach out to more and more prospects. Also, broaden your pie by creating a base of well-informed investors by spreading financial education.
