Vinod Jain, the king of SIPs embraced technology solutions in 2005 helping him increase his client base phenomenally. Jain tells Anju Yadav that his next move will be to set up an NGO for educating investors.
Vinod Jain of Jain Investments, known as the king of SIPs among the distribution community, has had a 12-year journey as a financial advisor. Besides Mumbai, he has offices in Pune and Goa. He provides services like financial planning, wealth management, tax planning as well as portfolio management with a total of Rs 210 crore of assets under his advisory. Nearly 85 per cent of these assets are invested in mutual fund schemes.
He now aspires to form a non-governmental organisation (NGO) to undertake the task of educating investors for taking wise investment decisions.
The idea of becoming a financial planner came to his mind when he was working with Birla Sun Life Distribution. Having managed his personal investments well, Jain thought he could deploy his expertise to manage investible surplus of others. Finally, on February 2, 2000 he gave a shape to his idea and launched Jain Investments.
Jain is a chartered accountant and has even worked in the National Stock Exchange. Initially, he started his business managing investments of some seven friends of his. He had taken a three-year loan from HDFC Bank to set up the infrastructure for his business. Referrals by his friends and relatives led to multiplication of his client numbers.
From day one, Jain was selling SIPs (systematic investment plans) to his clients. Jain said he would always tell his clients to think long term, one major difference being that his definition of long term is 30-40 years and not 5 years!
He says honesty and winning the trust of clients makes financial advisory business successful. The intent of the advisor should be visible. He has never used newsletters or did advertisements to market his business. It is only on the basis of the word-of-mouth publicity that he grew his business.
After over six years of building his advisory business, he realised the importance of technology to add value to his business as well as to clients. In 2005, he approached his friend Rajesh Jha, who was his colleague in Birla Sun Life Distribution and had a technology background, to join him in his business. Implementation of technology solutions helped Jain provide services to clients more efficiently. His client base has now increased to 10,000 investors from 1,400 before Jha joined him.
Asked if allegations of mis-selling by distributors ever affected his business, Jain said his clients trust him and therefore, he had nothing to worry. He feels distributors are not the only ones responsible for the mis-selling. The fund houses too are to be blamed and sometimes clients too are careless.
After the ban on entry load, he has still not started asking his clients to pay a fee. He is managing his operations from the commissions paid by fund houses and the trail commissions that he receives on the assets under advisory.