More Kiwis and NZ businesses taking the risk of getting involved in the sharemarket

As the housing crisis bites and interest rates remain low, increasing numbers of people are looking at new ways to invest in the sharemarket.

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The recent struggles of companies like My Food Bag are a warning to those wanting to get in on the action. Source: 1 NEWS

But the recent listing of popular NZ company My Food Bag has disappointed many, sending a warning to those hoping to gamble on stocks and win.

It comes as the popularity of meal kits has soared but when Kiwi success story My Food Bag - fronted by celebrity chef Nadia Lim -decided to go public in March, the listing slumped.

“They had a real ramp in revenues and profits during Covid, and we're always a bit wary as to whether companies that have a big ramp in revenues and profits, because of a one-off event, can repeat that,” says senior portfolio manager at Fisher Funds, Sam Dickie.

That's despite it being hailed as the biggest newbie to enter the market in years.

“They are really hunting for people who have a lot of skin in the game. They eat their own cooking and the opposite happened here…insiders and directors and founders sold almost all of their stake in the company to the public,” Dickie says.

Since the rocky start, shares have continued on that downward spiral with other meal kit providers also starting to provide serious competition.

“Hello Fresh for example has come from a standing start only three years ago or so and it's already about the same size so that moat is not evident for the company,” Dickie says.

My Food Bag is not the only Kiwi listing struggling - A2 Milk has also taken a dive.

Kiwi investor Cameron Downey admitted there's been a lot of learning in his sharemarket journey.

"I didn't lose any money but I'm back to where I started so it's been a bit of a fun ride," he said.

"When you're first starting out you get really really excited when you see the ticker go up and you get equally worried when it goes down."

New platforms like Sharesies, Hatch and Invest Now, have made it easier for people to invest, rather than going through traditional fund managers. Combined, these companies now have nearly 300,000 Kiwi users.

"The access that platforms that Sharesies and Hatch have provided to the market, it's a democratisation of what's typically been a difficult space to get into."

As for My Food Bag; it's due to release its financial results on Friday where it'll hope the proof is in the pudding.