The rise of retail investors is one of the most notable events of the pandemic era. Most of them became savvier and more self-educated amidst economic uncertainties and market volatility. Now we have more young investors than ever before, many of whom have high-risk appetites. Interest in stocks and cryptocurrencies have reached new heights and is still rising.
But this new wave also comes with new problems. For instance, higher public interest has to meet with increased inclusion. That means the more people want to get involved, the more there have to be simplified investment methods. Also, it is easier than ever to open brokerage accounts and crypto-wallets. There are now many platforms that help people easily invest with their smartphones and computers. While this is a good thing, it can also increase the chances of losing track of assets. It becomes almost as easy to forget assets as cash saved in a drawer. But then, hiring asset managers is also expensive. Consequently, many new-age investors incorporate bookkeeping methods to monitor their assets.
Aside from personal accounting, the ease of acquiring digital assets can leave investors and their loved ones exposed. For instance, persons with multiple crypto wallets might need someone else to access them in emergencies or even after death. But since crypto assets are so private, it’s hard to track them. Blockchain data show so many dormant accounts today, demonstrating that some of the holders may no longer be alive. The same goes for stocks and other assets.
Oluyomi Ojo founded COVA to tackle this problem. After stepping down as CEO of Printivo, Ojo focused on creating a product that helps investors track all their assets in one place. Today, COVA keeps track of digital assets such as stocks and crypto, as well as physical properties such as land. COVA has garnered users from all over the world in its first year. In this interview with Ventures Africa, Ojo discusses the journey so far.
Tell us about yourself and COVA.
My name is Oluyomi Ojo, co-founder and CEO of COVA. Before COVA, I founded Printivo, which changed how Nigerians ordered prints. In August this year, I stepped down to focus on COVA. The whole idea about COVA is to give people a single source of truth for their wealth. Assets today are extremely fragmented and decentralized. One person can have multiple bank accounts, use different investment platforms, own land, and several cryptocurrencies in several wallets all at the same time. How do they keep track of all of this, and how do the people who matter most in their lives find these assets? It’s on this premise we built COVA. We operate remotely from different parts of the world, so we understand different climes and how to serve them. Over half of our team is in European countries, and my co-founder is in Canada.
What inspired you to start COVA?
It came from a place of personal experience. In January, I went online and bought dogecoin (cryptocurrency) on Binance. Then I said to myself, “I just created a Binance account and bought an asset. I don’t know what it will be worth in the future, but my wife knows nothing about it. The people in my life don’t know what I just did.” So I quickly texted her and gave her the details. But I saw how easily I could have forgotten to do that. I followed that up with a tweet about this being a startup idea, and it got a lot of engagement. Many responded by saying they used Google sheets to keep track of their investments. Some even write them on sheets of paper. I figured that this was a problem we could solve through technology.
I also found out that there are large volumes of unclaimed assets around the globe. For example, the US government is sitting on $80 billion worth of unclaimed assets. In Nigeria, unclaimed stocks alone have reached N160 billion over the last 60 years. Many pension funds are also unclaimed. All that money belongs to some families and could be life-changing for many of them. So I decided to create a tool for people to effectively manage their assets. There has to be a product that automates the tracking of assets and helps people make sense of what they own.
What are the challenges for startups like COVA?
Firstly, what we do is still new, and people are not yet used to it. So they have many questions, and we have to earn their trust. We also have people who don’t want to think of death as an event to prepare for, especially in African countries. In developed nations like Canada, our users don’t blink when we mention that part.
Another challenge is that customers keep needing more. For instance, we have users already asking for deeper integration. They have multiple bank accounts in different countries, and they want to connect them to COVA. As of today, we can only do that for accounts in Nigeria, U.S. and Canada. And then assets like cryptos and U.S. stocks don’t yet have mass adoption in emerging markets like Nigeria. But these challenges are because we’re still in our early days.
How is COVA influencing the investing culture in emerging markets?
From the feedback we have gotten from our early users, COVA is influencing their investment decision making. And that’s mostly because they got to understand themselves better by using the app. For example, one of them said he discovered he was too tilted towards real estate. Knowing that real estate investments are illiquid, he adjusted to buying more liquid assets. COVA is making a lot of our users intentional about diversifying their assets. So when someone sees that a drop in bitcoin’s price brings down his entire portfolio by 10 per cent, he knows he’s over-invested and becomes more judicious. Also, many older investors are becoming more curious about modern assets.
Written by Oluwatosin Ogunjuyigbe