Chief executive Dean Anderson says the losses represent the investment his company has been putting into its platform and that break even point should come some time next year.

Kernel is delivering on its “multi-year road map” and much of the investment has been into technology, Anderson says.

The fund manager, which offers passive indexed funds and launched its KiwiSaver offering last year, lost $4.9 million in the latest year, up from $2.9 million in the previous year,

The latest loss brought total accumulated losses since the company began operating in the six months ended March 2019 to just below $10 million.

Kernel had $2.6 million in cash at March 31, down from $5.4 million a year earlier.

Shareholders tipping in an additional $2.5 million on top of the $8.1 million they invested the previous year.

Anderson says there's been one more call on shareholders since balance date – he wouldn't say the amount raised – and that should be sufficient to see Kernel through the break even point.

Kernel launched its KiwiSaver offering publically in the September quarter last year and Anderson says the number of sign-ups is twice what he'd been expecting.

Anderson and chief operating officer Stephen Upton founded Kernel after having worked for NZX's passive funds manager SmartShares.

He explains that his company doesn't invest in established global passive funds, as SmartShares does, but uses technology to replicate various indicies and actively manages the exchange rate exposure, thus avoiding all the hidden fees that investing in other funds would incur.

Kernel charges a flat management fee of 0.25% on its core funds and 0.45% on its specialty funds.

It allows its investors to choose from its range the funds they wish to be in. Once members have $25,000 invested, they pay a flat $5 a month – that charge doesn't apply to KiwiSaver.

Called the platform fee, this from this actually fell to $36,925 in the latest year from $42,461 the previous year because Kernel raised the threshhold at which it kicks in from $1,000 previously.

After hiring experienced fixed interest manager Matthew Winton last year, Kernel now offers an actively managed cash fund as well.

Anderson notes that the cash fund has been the best performer in Morningstar's survey since inception.

Kernel's accounts show fee revenue in the latest year rose to $883,284 from $580,166 the previous year.

Anderson says revenue has grown substantially since balance date and Kernel now has about $600 million in funds under management.

The biggest contributor to the latest loss was a doubling in employee benefit expenses to $2.4 million, mainly wages and salaries, while other costs rose 48.9% to $3.1 million.

Of the latter, marketing costs more than tripled to $1.1 million from $332,332 the previous year, reflecting the KiwiSaver launch.

Finance income, which comes from investing members' contributions until they choose which Kernel funds they want to be in, jumped to $170,486 from $11,008.