What was the R3 price?
That was without a functioning app, onboarded users, US stocks etc etc
Do we think £2-3? Or more?
Would it not be too much? I think something along the lines of £1 or £1.50 is more reasonable
Yeah perhaps ? I’m entirely uneducated when it comes to valuations
Just a hunch given where they were so far away from where they were under 12 months ago!
I’d be surprised if it’s not at least £2.50. Similar increase to Monzo between rounds at the same stage. There’s the vaguely hinted new Freetrade platform and the speculated challenger bank integration, neither of which were factored in before
My 2-3£ estimate was conservative
I think more
Obviously I won’t comment on whether I think those prices are right or wrong / reasonable or unreasonable. But this seems like a good opportunity to remind people about our blog post on How to value startups.
Personally I find it easier to start by working out what overall valuation seems reasonable & then working back to the price per share from there. In the last crowdfunding round our valuation was £18m so what would make sense now?
A lot has been accomplished since the last raise, but I think this next one will still be the last raise before the boom, rather than the first one thereafter. I hope for a big fund to iron out a lot of the problems but not something that indicates this is mass market already. It’s a fantastic app, and it’s going to be massive but at the moment there are still loads of niggles to address before it’s “big time”, so to speak. Though I’m not sure to what degree the potential will be built in. Hey, ho. I’ve been in since round 1 so it’s all good!
Does this not reach the same conclusion?
It can do yes. It’s just another way to approach answering the same question.
Possible comparative: Robinhood had 4m users, 150bn transaction vol and 3.4m rev when it raised at a 5.2bn pre/5.6b postmoney valuation in 2018 (sources here and here ). That gives a value per user of ~$1300 (pre money).
The only one of those numbers I know for Freetrade is 12k users. We might be generous and say that another 50k are onboard by the time the next raise happens, and that they’re all actively using FT. So 62k users. Robinhood’s value per user would imply a value per Freetrade share of £1.60 ish. (But would be very interesting to hear FT’s transaction volume, rev, % instant vs basic, stuff like that!)
Words from an investor:
"1. Our business is one requiring patience. It has little in common with a portfolio of high-flying glamour stocks and during periods of popularity for the latter, we may appear quite stodgy.
It is to our advantage to have securities do nothing price wise for months, or perhaps years, while we are buying them. This points up the need to measure our results over an adequate period of time. We suggest three years as a minimum."
Warren E. Buffett
Our Performance in 1963, 18th January 1964
What have I missed
So 2019 Q1 is almost done - any news on the proposed next fund raise? Are waiting on results from the New York trip?
New York trip?
There’s no new news right now I’m afraid but not because we’re waiting for the New York trip.
Thanks, no idea how could have I missed that! ><
I thought the Q1 comment was mentioned here but it’s not
Where did Freetrade mention Q1?
Investors’ launch event in November
Cheers suppose not in any great rush for the campaign, just being impatient!