Smart Money - Charles Savage on AI, investor behavior and the future of EasyEquities

Added: 2026-05-17

[00:00:03][music] >> Hello, you're watching Smart Money and joining me in conversation today is Charles Savage, CEO of Purple Group.

[00:00:18]This on the back of the company having in its latest info that highlighting the scalability and operational leverage in the business where incremental spend is now translating into outsized revenue growth. But Charles, so good to have you with us and of course Purple Group is a lot more than just Easy Equities.

[00:00:40]But Easy Equities is a big one within the stable, right? Seeing impressive growth in registered and active clients.

[00:00:47]So, perhaps going beyond what's um fundamentally driving that growth, what's your thinking around the quality of that growth? I mean, are you seeing a deeper engagement, long-term investing behavior, or is that still evolving?

[00:01:04]Yeah, I mean, look, we're 11 years into this journey now, so the data's is very insightful. Um these customers get more deliberate around their investments the longer they're on the platform. So, somebody who started in their first year, you know, is if if you like is in the trial phase. Um they're educating themselves, they're understanding investments for the first time, and so they're cautious but engaged. 11 years later, they're very deliberate. And and they pitch up with more capital, more intensity, and more engagement um every single year.

[00:01:38]And I you know, I guess we could have predicted that 11 years ago, but it wasn't the dialogue of the industry. You know, the dialogue of the industry was that investors pitched up infrequently, that they were scared by market sentiment, by um that they their behavior let them down. And that's not what the data's telling us. The data is telling us that the longer they are on the platform, the more deliberate they are, the more they're engaged they are, the more capital comes and the better the results are in their investments. And so, it's a very durable behavior set that has surprised us in the outcome and we're just really proud of what our investors are achieving year on year.

[00:02:19]You know, investor behavior is one thing, but on the other end of that continuum, you've got to give credit to your conversion team as well, you know, in being able to I guess close the gap between registered users and consistently active investors as well.

[00:02:32]What's been key, would you say, to closing that gap from your end and how much further do you have to go?

[00:02:40]It's It's about fundamentally understanding what is stopping people or preventing them from taking up investing. And to be very honest with yourself around firstly, is it a problem that you're introducing? Are you creating friction in that onboarding that is unnecessary? And then secondly, are you addressing the friction points that your customers are, you know, where they are, what their level of education is, what language do they use, what tools and platforms and capabilities? And so, we're still at the very start of this journey. I mean, if you just think about the impact that we that we want to have. We want every single South African in this country to have the opportunity to invest. Today, 1.2 million investors take up that opportunity. Um and so, we've solved the problem, if you like, for 1.2 million South Africans. But there are another 60 million out there that we need to solve for. Um but the And the path to get there is not a That's not a It's not a dream um in the sense that it's not it's it's not achievable. It is achievable, but the path to get there is through the experiences of the customers that we've got.

[00:03:48]Deeply understanding their needs, their wants, their desires, and the friction that is present in their lives, and solving that. And as we keep solving that, it'll solve it for more investors in time, and open the audience to more and more investors. So, we we're so early still in this journey. You know, we've done if you like, what's one of one of six most 60 million. It's a small percentage. It's, you know, less than less than 2% of the way.

[00:04:16]Absolutely. Look, client assets are up more than what, 40%? So, that's signaling that clients are investing more of their money on your platform, Charles, despite the retail investing space having become a lot more competitive, more cost sensitive, as well, in a constrained economic environment. Not to diminish the growth and activity you're seeing, but where do you see the biggest threats to your position right now?

[00:04:43]AI.

[00:04:44]It's if you're not you know, AI is is single is is the biggest threat to any digital business in the world. We don't escape that, not because we're a digital business, but also because fundamentally, I think the future of finance is going to be one on an AI operating system. And what I mean by that is that at some point in the future, we will give up the digital applications that we've so comfortable with, and transact through AI channels.

[00:05:14]Either through chat or voice. My I think voice will be the default in time, if I look at the way kids engage. But, the bottom line is that AI is the threat.

[00:05:24]And so, for us, we've been we've been implementing AI within our business for the last 2 years. And as we noted in our results, we're in the decks of an AI transaction to radically transform our AI capability, and to lean much deeper into the transformation that AI is going to drive, in our view, in the next decade.

[00:05:48]So, how would you set or how would you be rating right now your structural defensibility if I can call it that, you know, in terms of your model being a hard one for competitors for AI to replicate over time?

[00:06:03]Yeah, I think the moat is compliance and regulation. So, you know, fortunately, we don't sell a product that is that is is not surrounded with high barriers to entry. And those high barriers to entry are regulation and compliance. And so, you know, AI is not compliant yet. It can't give you advice. It can't trade stocks for you. It can't do what we do.

[00:06:23]Um and so, that's our kind of regulatory moat or our defensible moat for now.

[00:06:28]That will change in time. Um you know, in the same way that AI isn't going to walk into a doctor's into a surgery and perform surgery today, within the next decade it will. Um and so, for now, we will have some defensibility against AI, but fundamentally, that's that's got a time it's going to expire, that defensibility. And so, we've got to embrace it and start to transform our business. And you know, perhaps we're early, perhaps I'm wrong, it doesn't happen the next decade, it happens the decade after. But in my view, this disruption happens within this next decade. And and I actually see it happening within the next 5 years. And we're preparing for it.

[00:07:06]And as you anticipate and prepare for that, I mean, you're expanding your product set. It's expanded significantly over the past few years. And that in itself, Charles, presenting opportunity to convert right more customers into more products. Almost all of your products showed excellent growth over this last reporting period. What's the one product or area of growth in this period that you think the market is underestimating or under appreciating?

[00:07:35]Look, I think it's it's got to be our global aspirations. You know, Philippines, Um, we've obviously built up an incredible business in South Africa and and and no one underestimates that it's in the numbers.

[00:07:46]We've talked about Philippines for a long time now. It's the road to getting real customers in Philippines has been long and hard-fought. But I think what people are underestimating is that it's not a question of if it's going to happen, it's just when it's going to happen. Um, we're in the regulatory sandbox. We have the best partner we could ever wish for. GCash. There are 110 million Filipinos, 90 million of them use GCash every single day.

[00:08:13]Just say that again, like it's every single day 90 million people use GCash.

[00:08:20]And we that's our partner for US equities in the Philippines. So, you know, will it happen in the next 3 months? I hope so. Have I got any certainty? No. Have I got a growing confidence? Yes.

[00:08:31]Will it happen at some point? For certain, it will.

[00:08:34]Um, and I think that's the piece that is underestimated and priced in uh the purple story for now.

[00:08:41]Yeah. As you talk about this global expansion, you know, of your footprint, uh this growth comes through in what is a very challenging market environment.

[00:08:50]So, I want to take this conversation into that broader operating context as well. I mean, you've repeatedly indicated that current markets are being defined by the Iran-US conflict. Uh how much of what we're seeing, do you think, is fundamental versus a geopolitical risk premium premium that could unwind quickly?

[00:09:14]Yeah, it's it's hard. I mean, I think you know, the fundamentals underpinning um markets right now have been we're really strong. And if you I you know, I I just want to go back to January. It doesn't feel that long ago.

[00:09:26]Um uh but a lot has happened since January.

[00:09:29]We We walked back into in January and I I said to my team, it feels like I feel like I'm, you know, Goldilocks and the, you know, and the Bears. It's South Africa was in a perfect fundamental position. Everything was in our our favor. And and then you know, tonight we're going to see a 6 rand increase in diesel prices and interest rate hikes are back on the table and not for anything we did wrong.

[00:09:55]And because of geopolitical and instability around the world because of Trump and his you know, and his you know, Iran tactics. And so we are it's it's a fragile world we're living in.

[00:10:07]We're where you can go from being so confident, so certain about the future to being so uncertain in such a short period of time.

[00:10:17]And that's it's exciting but daunting at the same time. But it presents opportunities to investors but also it makes strategy very difficult to have a long-term view on.

[00:10:27]You have to be much you have to apply much more agility in the way you manage and operate a business in a world that can shift that much in such a short period of time. So you know, I think the underlying fundamentals are specifically let's bring it back home for South Africa are the best I've ever seen.

[00:10:43]Take the war out. At some point it'll pass. It too will pass. And when it does we'll return to those those fundamentals and I think that we are set up for a decade of durable growth and almost reinvention in in South Africa that I really look forward to.

[00:11:02]Yeah, it's a tough place to be, right?

[00:11:04]You have to invest having to navigate the the short term where it's driving all this volatility and certainty that we're seeing versus the longer term where the real economic impact may be more persistent but may recalibrate us in a different direction as well.

[00:11:21]As we talk about this, you know, evolution, transformation, as much as things change so much stays the same.

[00:11:27]You know, you've recently celebrated what 25 years at Purple Group. What's fundamentally changed about building a financial services business today, Charles, compared to when you started and what surprisingly stayed the same?

[00:11:42]Look, the good news is that what stayed the same is that the most powerful asset in investing is time. The most powerful thing in and and the most undervalued asset is time. You know, as I get older, I'm more I'm more aware of how what a wonderful asset it is. But, that's that's that's that's durable. That's going to last forever. You know, time is finite and so I'm most valuable asset, but it's um and and in investing it is it's the most important thing. The earlier you start, the better you will do. What has changed is that you live at the coalface of your customer. There's no hiding.

[00:12:16]Um there's no place to escape not 1 minute of the day.

[00:12:20]Um it's it's full on. It's 7 days a week, 24 hours a day at the coalface of your customer. Um and that's for everyone. All businesses. We talked about the Trump effect and everything's this attention economy feeds on on news flow and activity. And if you're going to run a business in the modern economy, it's 7 hours a it's 7 days a week, 24 hours a day and it's full on.

[00:12:44]So, as you look ahead, what do you think will be the hardest thing to get right over the next decade both Perpetual for the industry more broadly speaking?

[00:12:53]I think it's getting be comfortable that change is not is is no longer something that happens from time to time. It's change is constant. And we are the the pace of change has accelerated radically over, you know, my career, three decades.

[00:13:07]Um and at all different points and I always thought we're it's going to slow down.

[00:13:11]At some point you're going to get maybe an hour to breathe again. And it hasn't.

[00:13:15]And I think that's the challenge for the modern uh CEO is that you have to build organizations that are capable of changing all the time. And that change is a constant variable in your business model. And that is that is hard. Change is a difficult thing to engineer. People are mostly uncomfortable with it.

[00:13:35]But it's for me it's a It is It is It's here forever and it's going to accelerate forever. And if you don't build a business that's capable of adapting itself, reinventing itself in short periods of time, then I'm afraid like the dinosaur was, you'll go extinct quickly.

[00:13:52]Absolutely. Well, Charles, let's leave it there. Always a pleasure catching up with you. Thank you so much for sharing your time with us today. Charles Savage is CEO of Purple Group.

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