Spaceship chief executive Andrew Moore says its managed investments business has been the "single, strongest" source of growth for its $300 million superannuation fund.
Spaceship, which started out as a superannuation fund in 2017, added a managed funds business called Spaceship Voyager in 2018, offering two low-cost equities funds with the average investor a 30-year-old worker.
Voyager ended FY20 with stellar returns on both options (its universe portfolio returned 37.39% in the year ending May 31) but also with great customer growth, which Spaceship hopes will transform into growth for its superannuation fund.
The product currently has about 75,000 active users, growing from about 45,000 at the start of this financial year.
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July alone has brought 5000 customers to Voyager.
Moore, who was took over as the chief executive in August last year following co-founder Paul Bennetts' exit from management at the firm, is excited by the client acquisition for the year. He sees it as a cross-over opportunity to its superannuation product, which is a bigger contributor to combined revenue.
"Our single strongest growth in super growth is coming via Voyager customers," Moore said.
"Superannuation remains a very important product for us. One of things that we have come to understand is that we can build a relationship like [through] managed funds," he said.
The superannuation offering has about 6000 members, of which half also use Voyager. The firm in May added the superannuation product to its Voyager mobile app and, effective July 1, combined their websites with the aim of introducing existing clients in either offering to the other.
Voyager currently only offers equities funds and plans to stick to it, given the longer-time horizon of its younger-aged investors.
Moore says the firm is not contemplating offering external managed funds or individual ETFs on the Voyager platform. He also rules out an interest in adviser-controlled market.
"From a product development opportunity, we are in the middle of actively looking at an ESG option, which marries up with the customer demand for ESG," he says.
Plans for superannuation offering
Spaceship Super has gone from managing $180 million around last May to about $300 million now.
Returns have helped on the way, with its equities-heavy GrowthX option returning 14.77% over the year ending May.
Moore says Spaceship has the no immediate plans to pursue an RSE license (which it has previously sought), and faced no disruptions as Tidswell Financial Services changed hands from Sargon to Certes Corporation.
He also says he the fund is not pressured by APRA heat maps and merger pressures and remains strongly supported by existing investors, which include billionaire Mike-Cannon Brookes's family office Grok Ventures, AirTree Ventures and Hong Kong-based Horizon Ventures.
"We have looked at it in the past [getting an RSE licence]. It's not on our current super roadmap. APRA has advised -- and this has a COVID overlay to it -- they won't be accepting new applications," he said.
He also rules out the possibility of buying an RSE license.
"While in past some licenses may have changed hands with different levels of regulatory requirement, now the expectation if it happens is that APRA would be heavily involved," Moore said.
The firm now has about 40 full-time staff and a few casuals and combined $420 million in funds under management. Its last valuation, during its 2018 raise, pegged it at $80 million.
Superannuation is currently the bigger revenue contributor of the two streams of business.
"Part of the reason is that if you look at the average balance in the superannuation product, which is about $50,000, it is much higher [than Voyager average investments]. We would anticipate that would continue to be the case, which is why it remains a product offering for us," he said.
In relation to FY20 revenues, Moore says superannuation segment is now at a point where it is making a meaningful contribution to covering the costs.
He sees APRA's pressure on superannuation funds to merge directed more at older funds that are stagnant, potentially under-performing and expensive.
"No, [we are] still strongly supported by existing shareholders. Realistically, there would be a period of time before we will be profitable...we want to build a strong retail services brand and we will have 100,000 customers soon," Moore said.
The company plans to raise additional capital from existing investors in the year ahead.