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Dane and Bastiat Viljoen are looking to tap the growing retail gold bullion investment market by setting up an entity in Singapore that will allow anyone from around the world to buy gold bullion through their app Troy Gold.
Currently the app, which the Pretoria based brothers launched in March, allows South Africans to own as little as a R1 share of a one-ounce Krugerrand coin, currently valued at about R21 000. The startup stores the gold for clients in a secure volt and also delivers it securely to clients when they ask to redeem it.
The two last year raised a R5-million seed round from Astatine Ventures, a Pretoria based family office run by Oppel Greeff, Abraham van Wyk and Gillian Corken — all from the medical profession.
The investment allowed the startup in March to launch the app, which it had been testing since October last year. The two have so far sold R10-million of gold and are currently storing 250 ounces (R5-million) of gold in Krugerrands for about 250 clients.
Troy Gold wants allow anyone in the world the chance to purchase Singaporean gold bullion through its app
User adoption, claims the startup, is growing at eight percent a week and over 1200 users have downloaded the app, many of them young professionals in their thirties.
But it’s the startup’s latest endeavour that may prove to be worth its weight in gold.
‘Aim to launch offering in 2020’
Speaking to Ventureburn yesterday, Dane Viljoen (pictured above, left with brother Bastiat) said the two had spent “the last year and a bit” which has included three visits to Singapore, to duplicate the startup’s infrastructure on the island state.
The two are partnering with Swiss based gold bullion producer Metalor and US listed volt company Brinks Global Services to allow anyone from around the world the ability to purchase gold bullion through their app.
South Africans will be able to benefit too, as long as their trading falls within the SA Reserve Bank’s foreign exchange limits for individuals which allows South Africans to invest up to R10-million abroad in any calendar year.
Viljoen said the startup has filed for a precious metal dealer license from Singaporean authorities and if granted, expects to launch the new service at the beginning of next year.
He said the application falls under a new law that aims to turn Singapore into a gold bullion trading centre and which the island state passed in April.
He said the state’s authorities recently stated that it aims to complete all current applications under the act by October.
Going on figures from the World Gold Council, retail investment in gold accounts for about 30% of the current 4000 tons of gold production a year. The jewelry industry consumes over half of all gold produced annually, while that used by other industries consumes a further 10%. Central banks hold about 10% of all annual gold production.
‘Been in gold since 2014’
Viljoen said both he and his brother have “been in gold since 2014”.
Both completed BSc finance degrees at New York University (NYU) before returning to South Africa to work in Johannesburg in mergers and acquisitions, specialising in the area of SA resources.
The two also recently bought an old gold mine in Gauteng, which produced 30 000 ounces of gold before the two exited and sold their share to business partners in 2017.
Viljoen said the startup — which currently has a “core team of five” (about 10 people in all work on the project, he added) — plans to soon also allow clients to use any gold deposits they have with the company, to draw 70% to 85% of this in credit.
Says Viljoen: “We’re on a mission to democratise gold ownership – our technology allows for no investment minimums, so now anyone can own gold. Our slogan, naturally: ‘Real gold. In your pocket’.”
The words might be golden, but will their app prove to be the new gold?
Editor’s note (15 July 2019): Subsequent to the publication of this story, Ventureburn was contacted by BullionVault director of research Adrian Ash. Ash claimed that via web and smartphone, his company provided users in June with $92.1-million of gold bullion.
Ash said 1 July saw a new record client trade made using the company’s iPhone app, when a customer sold 32kg of gold (1028 Troy ounces) stored in Switzerland for $1.4-million.
He said since launching its website in 2005 and app in 2020, the company’s service is now used by over 75 000 people in 175 countries. Clients are able to choose secure storage (with Brink’s, Loomis or Malca-Amit) in London, New York, Singapore, Toronto or (most popular) Zurich.
“Together, clients today own gold, silver and platinum bullion worth $2.1-billion, he added.
Featured image: Troy Gold founders Dane and Bastiat Viljoen (Suppliers)