Sadly, this doesn’t surprise me with the market sentiment.
Was this (general cost cutting) stipulated as part of the recent £30m financing?
No idea but would investors be happy to back the firm of they knew this was coming…
I wonder in what areas Freetrade are cutting back on?
I have my own preferences, namely Crypto and I wish they would do things like tax certificates in app which would reduce demand for customer service.
More radically, I wouldn’t be unhappy if the referral scheme was paused.
It can be a requirement. Basically along the lines of “we’ll give you £30m to extend your runway by 80%, if you cut enough costs to extend it another 20%”. Not saying that’s the case here, just speculating, but it’s not uncommon at all.
I definitely think the freind referral scene is a way to loose money.
I’m not suggesting I haven’t gained from it in the past. I’m sure we all have.
But if freetrade need to cut the fat, while it recognises it’s business to become stronger on its journey to profitability, I’d be happy to see the free share scheme be temporarily ceased.
When the time is right it can be reintroduced.
FreeTrade likely have enough customers now and I’d suggest the way forward is to try and find ways to make the plus offering an offer people can’t refuse.
I notice that the analyst ratings are something that many will be well into.
Also may I suggest if freetrade want to become profitable overnight, there is one way it can happen.
There I said it.
I know freetrades management appear to want to stick to their morals on this one. I do get that on some level.
But as someone said to me.
“If someone wants to gamble, then they want to gamble. I doesn’t matter if they gamble on the dogs, the horses, sports betting or CFD’s. If someone has the desire to gamble, then that shall do so”.
Exactly my point.
Come on freetrade there’s a nice big juicy red button with ‘introduce CFD trading’ written on it in bold letters and it’s waiting to be pushed.
CFDs would be the ultimate betrayal of Freetrade’s vision and why many of us invested.
They can reach profitability without CFDs too. Significantly reducing marketing spend and trimming overheads will go a long way to that. If they can eventually add some new revenue streams (share lending, crypto, etc) then I could see them reaching profitability next year.
The bigger concern for me is that for a team of 300 staff (soon to be 255), they don’t deliver anywhere near enough. If they can start rolling out features like PMT levy, direct debits, tax statements, LISA/JISA then Freetrade will be in a much better place
It’s a price-efficient customer acquisition scheme, other companies in similar sectors are spending 10-100x per customer.
There’s no reason to stop adding users. Users are unit-profitable (even including CAC) the last this stat was published . I think Freetrade wouldn’t be too far off profitable if they cut the costs of international expansion growth and automated more internal procesees. Neither are easy tasks though!
Totally disagree with this sorry. They have already reduced the amount of people you can refer, gaining an extra customer for what would be on average say £5 is a no brainier.
I would however move away from the promotion of offering large feee shares for transferring an ISA, unless they add that plus must be bought for a year.
For my relatively small ISA I got a 300 pound share. If I invest just in ETFs then that’s over 8 years worth of ISA fees I have gained….
Old news mate!
300 people seems like a lot for a fintech startup company tbf. Not sure how many people they have outsude the UK aswell, but still. I used to work for a warehouse that was handling deliveries for entire continental Europe and some parts of Asia and we had less staff overall, including offices and everything.
That’s what is the supposed main advantage of tech companies- they don’t have a physical product and don’t need as much overhead, hence bigger profit margins on their product. I am not talking only about Freetrade, that’s been the norm in tech startups over the last decade. Seemingly good business model and yet burning through cash like there’s no tomorrow.
Again, not talking about just Freetrade as that’s been the norm in the tech industry for years now. I mean look at Netflix and Amazon, they were unprofitable up until recently.
They have how many people on their team!?
I thought it was like 40 people or so, now I too think they’re under delivering in some areas as I’m rather shocked tbh
It says 300 above
40? Who do you think is manning the customer services desk? Adam and Viktor just hoping on in between meetings?
Freetrade is a proper company and the 2nd largest broker by volume on the London Stock Exchange.
I agree 100% with your comment about CFD’s and do not want them but many would say that adding crypto is similar and potentially will turn many from safer investing into gamblers. No matter how much people value crypto either way the fact is there are millions losing lots and treating it like Skybet.
I feel that crypto is more or less a form of gambling and not investing. CFD’s also are a form of gambling. Nothing wrong with either, but let’s not call either of these investing.
Also freetrade does offer inverse ETFs. ETFs where the price rises if the market sector drops. This could be seen as a more complex investment product with more risks.
My point is freetrade has some higher than usual risk complex producer in the name of inverse ETFs and is also looking to include support for risky Crypto, something that I don’t think is truly beginner investor friendly at all.
I’m not bashing freetrade at all here. I’m just pointing out a mere observation.
Tbh, I seem to recall that Freetrade clearly said that they were anti crypto when I originally invested…
I don’t think crypto and CFDs can be put in the same bracket.
No-one who has invested in bitcoin over a 4 year period has ever lost money (if you bought at the absolute peak in 2017, you’d still be even). It’s a highly volatile new asset class, but if you stick to Bitcoin and Ethereum it’s much better. Most of the people losing everything are using leverage or obscure crypto projects.
But to be honest, I was initially against Freetrade having Crypto but now I think it’s vital for them to boost revenue and increase AUA.
Sorry but that is not quite true. Many crypto has gone under and disappeared. If you mean just on Bitcoin then yeah I get the point but I would assume FT will offer a range and how many of what they offer will soon be the same?
I am not majorly against it but would much rather FT became a master of stocks and shares than just a jack of all trades. The day FT has to put % warnings on how many people lose money on the site due to volatility will be a very bad day indeed and crypto could bring that.
Crypto 100% has a place but for me, and it’s just my view as an investor, I would prefer it not to be on FT.
I would much rather they add auto features, LISA and many of the other things people have been screaming for ages. I always viewed FT as a stable sensible long term platform and use other places for my gambling type stuff like crypto or silly stocks.