Stock-broking platform Punch has secured $7 million in seed funding from Stellaris Venture Partners, Susquehanna Asia VC, Prime Venture Partners, and Innoven Capital. The funding round also included contributions from notable angel investors such as Kunal Shah, the founder of Cred, Vatsal Singhal, the cofounder of Ultrahuman, and Nitish Mittersain, the founder of Nazara Technologies.
The newly raised funds will primarily be directed towards research and development (R&D) efforts aimed at enhancing the user experience and covering marketing expenses.
According to Amit Dhakad, cofounder and CEO of Punch, a significant portion of the funds will be invested in product innovation and understanding the needs of regulators and customers. The focus will be on promoting responsible trading practices without explicitly educating customers.
Punch, founded in 2022 by Dhakad, Hiral Jain, Arshad Fahoum, and Ajit Dandekar, operates as a trading platform developed by Market Pulse Securities, a Securities and Exchange Board of India (Sebi)-registered broker. The platform offers index and stock options trading, as well as direct stock trading.
Dhakad noted that approximately 60-70% of Punch’s users are young, part-time traders with less than a year of trading experience. While the company’s current focus is on options trading, plans are underway to introduce cash trading next month. The platform has been in a beta testing phase for the past 18 months, with around 18,000 trading accounts currently active.
Despite these regulatory challenges, Punch has observed that young traders continue to engage with derivative trading, often underestimating the associated risks.
