Former England footballer Rio Ferdinand is dipping his toe into the fintech world investing in a new overseas payments app launching this summer.
He spoke to City A.M. about why the partnership with Sokin is in large part because of his experiences through childhood and what he’s learned about investment.
The ‘Spotify of payments’
Sokin, which launches this summer, offers a fixed-fee, subscription-based payment app for overseas transfers. Chief executive Vroon Modgill dubs it the “Spotify of overseas payments”.
Sokin will charge users £9.99 a month to send an unlimited number of payments abroad. “We don’t pay for every track we download or each film we stream, yet when we’re sending money or making a payment, we’re expected to accept unspecified and variable costs. Why? This has to change,” Modgill said.
It claims to be a disruptor in a market that is saturated with low-cost alternatives by making the process cheaper and easier, and it’s personal for Modgill.
“Sokin was created because I have a father who had a lot of issues sending money back to India… There were repetitive costs, paperwork and he needed it to be a lot simpler. You have Uber drivers that have six apps when they need to send money, they don’t go to one provider,” he told City A.M.
Modgill met Ferdinand through a mutual friend and hit it off given their similar upbringing. Sokin’s offering resonated with Ferdinand: “I’m from a background where you always saw and heard people transferring money and you heard the difficulties and stress around that, not only from their end but the people receiving the money as well… it’s not something you forget.”
Rio Ferdinand, the investor
The former England defender is no stranger to the investment world having already piled money into sports focused companies. The investment in Sokin, for an undisclosed sum, may be his first foray into the fintech world but Ferdinand is adamant that it was not on a whim.
“There’s no point investing in the idea if I don’t feel there’s a team capable of building it and scaling it. It’s a great idea but more importantly for me, do I feel like Vroon and his team are the right people? I really do,” he told City A.M.
The investment represents an element of maturity in Ferdinand’s own foray into investing, he admitted.
“I wouldn’t go on an emotional attachment. I probably did that years ago but now I’m a bit more experienced… [Now] I can make much better decisions and I like to think this is going to be a very good decision in that respect because I’ve kept to the principles used by people who are very successful in this field,” he added.
He attributes this investment acumen to his friendship with Saul Klein, co-founder of seed fund LocalGlobe. “I’ve spent a lot of time with him over the last few years getting experience, being in various meetings at different levels to get an idea of how things work,” Ferdinand told City A.M.
He may well have built an understanding of the world but investing in a global pandemic is an entirely different ball game.
“A lot of people are sceptical about investing but I have a bit more confidence in a weird way to invest in a business built in this climate and is doing as well as it’s doing…. A lot of businesses have been built during the last recession which are now massive. So that helps in terms of the fear factor going into this.”
Ferdinand points to Sokin’s early success, having built the vast majority of the business during the pandemic. The startup has already struck up a partnership with Mastercard in Singapore, Europe and South Asia.
Sokin targets expansion
So where next for Sokin and Ferdinand? Even ahead of its launch in June, Modgill is confident Sokin can launch in 200 countries within two years.
Ferdinand is keen to play a part in this expansion, taking on an active role rather than a passive investor.
“We spoke about it on many levels and agreed a certain amount of involvement would be beneficial for all of us,” the sportstar said. “It’s just about mapping out where they see the benefits of me being involved more deeply than just being an investor.”
Modgill remained tightlipped about future commercial activities but Ferdinand’s 4.5m Instagram followers and BT Sport role will not have escaped his attention.
“It’d be silly to sit here and say marketing isn’t an area I could help with, that’s obvious to see but it’s just how,” Ferdinand said.