kachingKaChing, the Palo Alto-based startup that’s like Fantasy Football for investing junkies, is finally letting users put skin in the game today.

It’s allowing people to invest real money, matching its best investors blow-by-blow, while slicing off a share that it says is small enough to challenge the $10 trillion mutual fund industry’s traditional fee structure. The site launched as a stock-picking site last year where people could publicly compete to beat the market and attracted more than 400,000 users through its Facebook application. It also boasts prominent angel investors like Netscape co-founder Marc Andreessen and OpenTable CEO Jeff Jordan.

With the new features today, a person can pick the site’s best performers and automatically match their allocations with actual money. So if a top investor on the site has put 25 percent of their portfolio into Apple stock, a quarter of the amount you invest alongside them also goes to Apple stock. The person you’re matching charges a fee, usually from 0.25 percent to 3 percent, and KaChing takes a quarter of that. KaChing is also working on collecting commissions for stock trades.

The holdings of these investors, dubbed “geniuses”, are public and they have to be on the site for a year. KaChing signs legal agreements with them to ensure they follow the company’s policies and don’t front run (or improperly jump ahead of customer orders). The company also has access to their real brokerage accounts. There’s also a message board for an investor’s followers to ask them questions about why they shorted a stock, for example.

“The good have nothing to fear,” said Andy Rachleff, who co-founded Benchmark Capital and was brought on board as KaChing’s CEO. “We are dominated by an open source philosophy — the idea that information wants to be free.”

KaChing ranks its investors with a metric called “Investing IQ”, which is most heavily weighted on how well an investor explains the rationale behinds their decisions. Then it considers whether they stick to their advertised strategy and then lastly, and most classically, their risk-adjusted returns. That shows how well an investor did given how risky their strategy was — higher risk tactics can produce bigger payouts, so it’s not fair to compare an investor who looks only at large, blue-chip companies with someone else who dives into emerging market stocks purely on return.

KaChing’s minimum is $3,000 and the company limits the maximum you can invest based on your net worth and financial experience. A user can follow multiple investors at the same time and there aren’t any exit fees. Rachleff said the company might start offering star performers more hedge fund-style compensation to incentivize people not to leave and start their own independent businesses.

Founder Dan Carroll says he wants KaChing to disrupt the mutual fund industry, which can charge around more than 3 percent in management fees to help people save for retirement. Mutual funds have hidden fees and little transparency, added Rachleff. (Vanguard said the industry average mutual-fund expense ratio was 1.19% last year.)

“I’ve invested since I was 15 and have beaten the market over the years,” he said.  “I always knew I could do better. I wanted to create an investing marketplace, that could put small-time investors on the same playing field as the big guys.”

KaChing has raised $3 million in angel funding and has a number of competitors in the social investing space including Covestor, Market Riders and Cake Financial.