10X Investments, a South African tech-enabled asset manager, has raised $6.14m in new funding from DiGAME Investment Company and existing shareholder Old Mutual Private Equity.

Samer Salty, a DiGAME board member, said: “10X is already a major player in the South African market, and the opportunity to scale the business, which has proven superior investment returns, is substantial.”

“Advanced analytical capabilities, quicker response times and improved customisation, all at significantly lower costs than traditional asset managers, means 10X plays to our expertise in technology growth investing as well as demonstrating a clear social benefit,” he added.

10X said it would use the funds to further expand its retail offering and look at international opportunities. 

10X Investments manages more than ZAR8bn for individuals and blue-chip clients such as Virgin Active, General Motors and Deutsche Bank.

Since its inception in 2008, the 10X High Equity portfolio has outperformed the average large fund manager before fees, as published in the Alexander Forbes Large Manager Watch.

The company uses four core principles – index tracking, low fees, diversification and time-driven portfolios – to deliver competitive, long-term investment returns. 

“A simple online investing process, fees that are typically up to 80% less than the industry, and our award-winning investment strategy means more money for our clients at retirement,” said CEO and founder of 10X Investments, Steven Nathan. 

“The new round of funding will allow us to further empower South Africans who want to benefit from 10X’s simple and effective investment strategy,” he said.

“We are delighted to have the support of our existing investors and to welcome DiGAME on board,” added Nathan.

Wealth managers have historically operated in a relatively low-tech environment, but millennial customer expectations, growing market competition and more stringent reporting requirements have compelled them to rethink their businesses using technology. 

In the US alone, the wealth tech sector will have an estimated market size of $2.2trn by 2020, according to FT Partners Research Wealth Tech Report.

The opportunity to combine technology with proven investment strategies means there has never been a better time to be involved in the fintech sector. 

In South Africa, however, assets managed by index trackers remain a fraction of total assets under management, mainly due to a lack of awareness.

“We are excited to join Steven Nathan and the management team of 10X at this important time and are also pleased to be teaming up with Old Mutual Private Equity and the other shareholders in this investment,” Salty concluded.