Freetrade

Last updated

Freetrade Ltd
Type Private
Industry FinTech
Founded2016;7 years ago (2016)
FoundersAdam Dodds, Davide Fioranelli
Headquarters London, United Kingdom
Key people
Adam Dodds (CEO)
Viktor Nebehaj (CMO)
ProductsShare dealing
Number of employees
300 (2022)
Website freetrade.io OOjs UI icon edit-ltr-progressive.svg

Freetrade is a UK-based financial technology company which offers a freemium share dealing service. The company was founded in 2016 and launched an iOS app in October 2018, followed by an Android version in April 2019. [1] [2] In October 2021 the company surpassed one million registered users, [3] with quarterly trading volumes as of March 2021 of over £1 billion. [4] As of November 2021 Freetrade has over £1 billion of assets under administration. [5]

Contents

History

Freetrade was founded in September 2015 by Adam Dodds and Davide Fioranelli. [6] In 2019, it brought aboard venture capitalist Molten Ventures to complete a $15M Series A financing. [7] [8] [9] The first CTO was André Mohammed, who in 2019 left to join Revolut. [10] Viktor Nebehaj, an early crowdfunding investor, joined the firm as chief marketing officer. Ian Fuller joined as VP of Engineering from Snapchat in 2018 and left in 2021. [11]

The company's $69M Series B round was announced in March 2021, led by Left Lane Capital, with participation from L Catterton and Molten Ventures. [4] [12] However, the company struggled to find new backers at a higher valuation in 2022 [13] and had to resort to a convertible loan note [14] supplemented by a further crowdfunded round and a staff reduction of around 15%. [15]

In January 2020, the company was accused of fostering a culture of fear after a City A.M. investigation into staff claims of a toxic workplace. [16] Co-founder Adam Dodds responded, saying it has an honest and candid culture that not everyone is comfortable with. [17]

In January 2022 the UK Financial Conduct Authority (FCA) issued a second supervisory notice ordering the company to remove "all paid for sponsored influencer advertisements and posts" across a variety of social media platforms. [18] This notice noted the adverts were misleading "as there are no guarantees of positive returns on any investment", thus increasing the risk of vulnerable people in debt increasing their debt.

Operations

Freetrade offers a commission-free trading app on the Android and iOS platforms, which is open to users in the United Kingdom. Users may trade equities and ETFs listed in the UK and the US. For US assets, users may hold and trade fractional shares. Portfolios can be held in a tax-free ISA or SIPP (personal pension), in each case for a flat monthly fee. Freetrade launched its premium product, Freetrade Plus, in October 2020, offering an expanded list of tradable securities and order types. [19] [20] The product backend is hosted on Google Cloud Platform and Freetrade operates on a serverless computing model. [2]

In 2020, Freetrade had plans to enter the wider European market, beginning with Sweden, [21] Ireland and the Netherlands. [22]

Reception

In an early review of the service, Forbes described it as "a challenger stock trading app built for the Instagram age", and commended it on being the first and only challenger stockbroker in the UK, but criticized the poor financial charting, and its then lack of US securities. [23] In a 2019 review for MoneyWeek , David Stevenson described the available securities, which by then included both UK and US listed stocks and ETFs, as a "decent slug of the large-cap universe". And while it did not offer a full-service platform such as established competitors Hargreaves Lansdown or AJ Bell, "for those simply looking for regular, low-cost savings, I think Freetrade is hard to beat". Stevenson described Freetrade as his favourite fintech. [24] At The Next Web , Matthew Hughes credited Freetrade with "radically [changing] how I manage my money", inciting him to invest more, and increase his knowledge of the markets. [25]

Awards

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References

  1. ↑ Steve O'Hear (2 October 2018). "Freetrade launches 'zero-fee' investment app". TechCrunch . Retrieved 15 October 2020.
  2. 1 2 Caroline Donnelly (21 April 2020). "UK challenger stockbroker Freetrade backs Google Cloud to make investing more inclusive". Computer Weekly . Retrieved 15 October 2020.
  3. ↑ "Freetrade sails past one million customers". AltFi. Retrieved 14 October 2021.
  4. 1 2 "Investment platform Freetrade raises £50m as homebound customers fuel revenue surge". Sky News . Retrieved 23 March 2021.
  5. ↑ "Freetrade hits £1bn in Assets under Administration". freetrade.io. Retrieved 21 November 2021.
  6. ↑ "FREETRADE LIMITED - Filing history (free information from Companies House)". find-and-update.company-information.service.gov.uk. Retrieved 22 June 2021.
  7. ↑ Emily Nicolle (25 June 2019). "Freetrade to close £7m in second crowdfunding round". City A.M. Retrieved 15 October 2020.
  8. ↑ Emily Nicolle (31 October 2019). "City startup Freetrade raises $15m from Revolut backer Draper Esprit". City A.M. Retrieved 15 October 2020.
  9. ↑ Steve O'Hear (31 October 2019). "Freetrade, the UK challenger stockbroker, completes $15M Series A". TechCrunch . Retrieved 15 October 2020.
  10. ↑ O'Hear, Steve (10 January 2019). "Revolut hires Freetrade co-founder and former CTO as head of Wealth & Trading Product". TechCrunch. Retrieved 15 March 2023.
  11. ↑ "Freetrade's long-serving chief technology officer to depart" . Retrieved 21 October 2020.
  12. ↑ "Stock trading app Freetrade raises $69 million". TechCrunch. Retrieved 22 June 2021.
  13. ↑ "Fintech Freetrade struggled to find new backers at hoped-for valuation". FinancialTimes. Retrieved 14 March 2022.
  14. ↑ "Freetrade raises £30 million through convertible loan note" . Retrieved 14 March 2023.
  15. ↑ Smith, Oliver (10 June 2022). "Freetrade announces job cuts of up to 15% of staff". AltFi. Retrieved 15 March 2023.
  16. ↑ Emily Nicolle (29 January 2020). "Investigation: City fintech Freetrade accused of deliberately fostering 'culture of fear'". City A.M. Retrieved 4 August 2020.
  17. ↑ "Freetrade - Toxic culture". Glassdoor. Retrieved 4 August 2020.
  18. ↑ "Second supervisory notice" (PDF). Retrieved 14 March 2023.
  19. ↑ Oliver Smith (7 October 2020). "Freetrade launches its long-awaited Plus subscription with stop losses, limit orders and more". AltFi. Retrieved 30 October 2020.
  20. ↑ Duncan Leslie (6 August 2020). "Introducing Freetrade Plus". Freetrade blog. Retrieved 30 October 2020.
  21. ↑ "Freetrade: UK challenger stockbroker launches commission-free investment app in Sweden". UKTN (UK Tech News). 10 November 2020. Retrieved 11 August 2021.
  22. ↑ Madison Darbyshire (23 January 2020). "Freetrade stakes claim in Europe's fee-free stock trading markets". Financial Times . Retrieved 20 October 2020.
  23. ↑ Oliver Smith (3 October 2018). "Freetrade Review: A Challenger Stock Trading App Built For The Instagram Age". Forbes . Retrieved 15 October 2020.
  24. ↑ David Stevenson (1 July 2019). "Why Freetrade is my favourite fintech". MoneyWeek . Retrieved 15 October 2020.
  25. ↑ Matthew Hughes (1 October 2019). "How this stock trading app changed how I save money". The Next Web . Retrieved 15 October 2020.
  26. ↑ "British Bank Awards 2021 Winners". Smart Money People. Retrieved 13 July 2021.
  27. ↑ "Good Money Guide Awards – The 2021 Winners". Good Money Guide. Archived from the original on 8 August 2021 – via Internet Archive.
  28. ↑ "2020 Winners". British Bank Awards. Retrieved 10 August 2020.
  29. ↑ Oliver Smith (8 March 2019). "British Bank Awards see Starling, Monzo, Zopa, Freetrade, Chip and Bud take home gold". AltFi. Retrieved 30 October 2020.
  30. ↑ Richard Berry (10 May 2019). "Best Providers: 2019 Award Winners Announced". Good Money Guide. Retrieved 30 October 2020.
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