It’s the ethos of freetrade, making investing affordable to everyone. The whole 11.95 per trade is daylight robbery.
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But FT has to pay to use stock exchanges then?!
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I’m not sure I understand. Freetrade have build up £1bn AUA - the business model works but they’re in growth stage - this needs capital and good execution. At this stage if you commit to crowdfunding it’ll be because
a. You like the valuation and feel there is growth to be had
b. You trust the team to execute
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The trades happen automatically, FT just mentions that they do not pass on any direct execution costs to customers.
Let’s compare with other business models, which hopefully you are familiar with:
- 15 years ago you could only exchange/send foreign currency from high-street banks and you were charged obscene amount of spread and commission. Fast forward to now and you have the likes of Wise(former Transferwise) and Revolut, which give you almost mid prices, while making a tiny profit on each trade and scaling their service to 10s of millions of customers. This new competition has exposed the retail banks as greedy and have eroded their obscene profits from FX conversions.
- 15 years ago to fly Bucharest-London, I used to pay close to Euro1000, because the big state-owned airlines were inefficient, greedy and had no competition. Now, you have a choice of at least 3-4 airlines and the prices are under Euro100, typically even cheaper, etc…
When Michael O’Leary set up Ryanair, someone must have told him the same thing: “This is not sustainable and how are going to be profitable ?”
To me legacy brokers/platforms and active fund managers have their days numbered. They belong to an era where there was no transparency and they benefited from information asymmetry.
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That’s a good question. How much would Freetrade have to pay an exchange per transaction. Do they have to pay at all?
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They do pay a fee, of course. For the US stocks, if we remember from the GME saga, they use the DriveWealth broker platform, which is registered as a broker-dealer in the US and probably handle the clearing as well. These guys charge for access. In the UK, they execute directly to the LSE, from what I understood, so it will be probably cheaper once they setup the connectivity and so on.
So then how many shares you guys have
How optimistic are we feeling
Transaction fees for NYSE:
I can’t find anything that says if there are transaction fees on the LSE: Stock Exchange Fees – Trading 212
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Nothing in life is for free.
Even death costs you your life
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If you only buy UK AIM stocks or ETFs, trading on Freetrade is truly free. Subsidised by others, but still truly free for you. You don’t even pay stamp duty. 
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You’re on a forum called Freetrade. There are indeed things for free and they are paid for in other ways.
I don’t know the answer regarding exchanges, but it could be a scenario where transactions are free and the exchange makes money by charging companies to list. As an investor you are then indirectly paying for that if you buy shares in the company.
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To be allowed to trade on an exchange, there are participation fees(the exchanges are private entities who need to make a profit): London Stock Exchange | London Stock Exchange
Similarly, there must be fees for the clearing house and depositors.
In the US, the broker-dealer(Drivewealth) and the clearing-broker both charge fees for the users of their platform(Freetrade) and they in turn pay fees to the different exchanges they connect to.
In some circumstance, entities even need to pay for trading on indexes, as these are privately owned.(the name and methodology of the index)
In a way, this is (kind of) not that important. There will always be execution costs for Freetrade, even if we just consider the cost of cloud infrastructure, but the bet is the costs becomes smaller and smaller and they make enough profit from the users via subscriptions(ISA, Plus, etc…) that they become profitable long term.
@nickfell said something which I liked a lot. The goal is to make the FT value proposition a no-brainer, so that is adds enough value to the users that they are happy to pay a monthly fee like they do now for Netflix and Amazon Prime.
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@SebReitz I think you need a paid premium account to trade AIM stocks on freetrade.
Some are available on Free, those in the AIM 100, and presumably, those that have an IPO
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Can anyone clarify for me how the Crowd cube transaction works? I am already a member, many months now, but yet to buy anything as I joined for the next FT round. I can’t find a place to register my bank details etc and don’t think I did it when I joined up as I can’t find any ref to them in my profile or any options. Do I only do that stage when the pitch is out and I bid? or am I missing something?
It does say
" Receiving a payment
After you have made your first investment, you will have the option to add your bank account details for any investor returns that may be due to you in the future. Please note that these bank details will only be used to make a payment to you, and are not used to collect payment for any investments that you have made."
but this is for receiving money.
Just want to be ready at 11am to invest and not come across a little surprise. 
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You don’t actually have to pay until the pitch closes after reaching it’s target
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You input the amount you want to invest and click next and it’ll come up with your payment method, you can do a trail run for another company to see, also no money will be taken until 7 days after the raise closes.
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Excellent 
I just had visions of me finding I hadn’t filled in some paperwork or something and end up missing out 
Edit - For anyone else in similar position I have posted the response I got from Crowdcube below which confirm exactly what @Vincent and @Dave helpfully said.
Hi Gary
Thanks for your email.
When a pitch goes live next week that you would like to invest in - you just need to head to their pitch page and place your intended investment. Once you have placed the investment amount, you will be asked to enter your card details. There are currently no card details held for your account.
Please note that payment will not be taken at this time, but your card details and authorisation will be held until the pitch funds/closes and then payment will be taken from your card. You will be notified 24hours before payment will be taken so do not worry about missing this deadline as you will be notified. These card details will be kept unless you wish to change them at all.
You can update your card details anytime after your first investment is made by heading the 'payment’s tab of your ‘my account’ page.
If there is anything else I can do to help please let me know
Kind Regards
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Will there be shareholder perks if I own part of freetrade?
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