My bag is my office and the client’s desk is my work place,
says Alagappan Thenappan who took up mutual fund distribution after he lost his
job.
Chennai based Alagappan Thenappan holds a Bachelor of Engineering (BE). He started his career as a software engineer with a California based company in Chennai in 1993 but lost his job due to the 9/11 attack.
To his meet daily expenses, he wanted to withdraw his savings from insurance and mutual funds. The insurance company turned down his request as his policy had lapsed due to failure of premium payments. However, his mutual fund investments rescued him – not only did he get his money when he needed it the most, he had also earned decent returns.
Since then, Alagappan started evangelizing the cause of mutual funds to people, starting with his friends. As a result, his friends too earned good returns from mutual funds. Inspired by examples of some of his acquaintances who were into selling mutual funds and earning Rs 10,000 per month as commissions, Alagappan too decided to take up mutual fund distribution as a profession.
He became a mutual fund distributor in August 2005. “Getting the first client turned out to be very challenging for me as I failed to acquire a single client for the first two months. One of my friends introduced me to a businessman who wanted to invest in mutual funds. I went to his workplace and explained to him about the concept of mutual funds and the power of SIP. He was impressed and started a SIP. Till date he has enrolled for 100 SIPs,” recalls Alagappan fondly.
Alagappan realized that visiting clients in their homes/offices and educating them on mutual funds help build a good rapport with clients and so he decided to provide door to door service. Even today, he travels long distance even for micro SIPs, sometimes even 50 kms for a SIP of Rs 500.
Alagappan advocates SIPs to clients. “No matter how much you are investing, the only important thing is investing regularly.” Alagappan sells mutual fund schemes as a retirement product and advices his clients to invest in mutual funds through SIPs right till their retirement.
He points out that most of his peers gave up mutual fund distribution after 2008 stock market crash but he didn’t do so. During that period, he survived by enrolling clients for SIPs.
Alagappan doesn’t charge any upfront commission to his more than 5000 clients, almost all of whom are retail investors. His assets under advisory are Rs 22 crore. He advises his clients not to redeem unless there is an emergency. Another advice he gives his clients is that they must repay their existing loans before starting any investments.
Alagappan launched his website in January 2013. As he was a software engineer, he controls technical operations of his website himself. This website enables his clients to manage their investments free of cost. At present, his website has 1200 accounts. He plans to increase the reach of his website. He has also initiated talks with some fund houses to facilitate online investments through his website.
Alagappan says he works 24/7 whether it be Sunday or Diwali. In fact, he has acquired many clients on holidays. Alagappan has not rented any office. “My bag is my office and client’s desk is my work place,” declares Alagappan proudly.