Kernel finishes first year with capital raise

Index fund provider has completed its first year with a capital raise and appointment of new staff.

Friday, November 27th 2020, 7:04AM

The company, headed by Dean Anderson, says it has just raised close to $2 million to help fund future growth of the business. Also it is about to appoint a Head of Technology, a Head of Digital and additional team members in marketing, operations and product development.

“Whilst 2020 brought its challenges, Kernel is the realisation of a dream to help Kiwis achieve more with their money,” Anderson says.

“With new investment hitting several million dollars a week and building, Kernel has firmly established a sound value proposition, delivered innovation to the market, and – most importantly of all – patient investors who’ve focused on the long term have seen returns upwards of 20% over the last 12 months, despite the impacts of Covid-19.”

Several high-profile business leaders have recognised the Kernel value proposition and invested in the company. They include individuals with extensive capital markets experience, including Julian Knights OA who joins the Kernel board in December.

Among the moves made by the company are its launch of the lowest fee global equity funds offered by any local manager – which are among six index funds it has introduced to the market. Four of these offer brand new investment opportunities for New Zealand investors.

These funds are the NZ 20 which tracks 20 of the largest stocks on the NZX; NZ Commercial Property which invests in the eight largest Real Estate Investment Trusts on the NZX; NZ Small and MidCap Opportunities which provides balanced access to smaller listed companies; Global Infrastructure investing in utilities, storage and telecommunications infrastructure; Global 100 investing in 100 blue chip global companies; and Global Dividend Aristocrats which includes companies with records of high dividends over time.

“These funds reflect the core Kernel philosophy that a diversified, low-cost portfolio of index fund investments is the key to financial freedom,” comments Anderson.

He says investing has proven rewarding for Kernel’s customer base, 78% of whom are in the 25-50 age group with a median age of 39. “Average investor balances have grown by $707 each month, with the average balance sitting at a shade under $20,000. This shows that our investors are engaged, enthused and committed to building a better future by putting their money to work on the Kernel platform,” Anderson says.

Kernel has hosted 13 investor education events in the past year, including two with the Global team from S&P Dow Jones Indices.

Anderson says it’s fair to describe 2020 as an Annus Horribilis in which global markets experienced a battering, investors were spooked, and making sense of anything proved challenging. “Kernel as a company has weathered this unprecedented storm and we’ve emerged stronger for it.

Tags: Dean Anderson index funds Kernel