Freetrade VC Funding

Do Freetrade have any plans to raise finance through VC’s I feel very strongly that they need a massive investment to accelerate there growth before Robinhood arrive in 10 months time.

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Given the frequency of crowdfunding I’d assume they don’t need VC cash. Not to mention you can often get away with a higher valuation in crowdfunding, giving less equity for more cash :man_shrugging:t2:

I feel very strongly that they need a massive investment to accelerate there growth before Robinhood arrive

Any particular reason why? I don’t expect Robinhood to provide anything Freetrade isn’t well ahead of in 10 months time.

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I don’t think they can raise anymore through crowdfunding with EIS and with a company valued at 7 billion breathing down your neck,I just feel when Robinhood launch in the UK with all the bells and whistles not to mention the money they have to back them up,there App will be magnificent and probably ready to go with 1000’s of Stocks. I went to look at Rolls Royce shares on Freetrade and they don’t have it,which I found very disappointing.They don’t even have all the FTSE 100 Companies listed. What’s all that about??

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Typically startups that do crowdfunding can only do so many rounds before they progress into VC funding. I suspect that FreeTrade has reached that point or thereabouts.

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That is a lot of assumptions based on only the fact that their valuation is high…

Most of the shares at the moment get added through stock requests, so might be worth looking into that

Exactly,so I feel they need to act and kick on quite urgently,obviously not being reckless but when Robinhood come calling with all there money they can cause a lot of damage to Freetrade ie: poaching there staff for one

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RR. is a stock needed to be settled with reference to the underlying owners Nationality. This makes it impossible currently to execute as part of a batched/4pm run. It could be instant traded only (so there is only 1 persons National Declaration flag to populate) but FT aren’t offering that option yet.

Search for “National Declaration” in this forum. There’s been a lot of previous discussion around this topic.

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Thank you

FT have roughly £4m more that they can raise with EIS. They have said they’re looking at VC funding too, though

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Well I think access to 60-100 million trumps 4 million. They don’t have time to lose

Agreed. Adam has said that they are exploring a larger round, aiming to close by the end of the year. Absolutely this is necessary. They need firepower to compete and simply go faster. Money = Speed. Plus I think a couple of experienced board members would be welcomed by all investors.

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This is necessary. But I believe there is the market there for Robinhood, Freetrade and T212 to all be successful.

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I completely agree.

Freetrade - Friendly, long-term
Robinhood - Techie, high risk
T212 - Jack of all trades (pun not intended)

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What is T212?? I googled and nothing came up

Sorry, I just abbreviated Trade 212. It’s mostly a CFD platform with forex, crypto and share spin offs

edit: @AlexR explained it much better below

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Trading 212.

They offer CFD, a GIA and ISA.

Their GIA (called ‘Invest’) and ISA are essentially the same as Freetrade. They offer instant free trades for no fee - though the minimum buy amount can vary ie you might need to buy 2 shares to make the trade.

If you want a join them you can message me and I’ll give you a link for a free share.

My personal preference is Freetrade because of the community involvement. But I think all of these players can succeed and I’ll likely have accounts with all as I’m a fintech nerd.

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Freetrade are positioned nicely enough to take institutional funding by ~July 2020 at latest. VCs care alot about growth - Freetrade have done well on user growth, if Active user growth and revenues have done the same, VCs will certainly be interested, though theyll be more aggresive with valuation (expect dilution) and terms (liquidation preference, etc) than the crowd was. Post from CEO Adam Dodds in the last crowdfunding round below:

If we assume the intended VC is an EIS fund (as the crowdfund update/email screenshot below suggests) and sole investor, the investment will be a maximum of £6m (knowledge intensive early stage companies can raise £10m yearly, £4m of which was allocated in the crowdfund).
Screenshot_20190827-214212

The value of having a VC is capital, of course, and a well networked, experienced institution that can help with growth, key hires, etc. My hope is that freetrade can leverage this for help in talent acquisition especially. The best EIS funds imo are calculus capital and Mercia, both of whom have invested in financial services/Software before.

Also worth mentioning is that if freetrade can only raise ~£7m a year through crowdfunding without having to create a prospectus (a complex financial document that can cost hundreds of thousands of £s to make…) for those wondering about the likelihood/mechanics of a crowd round in the next year.

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Thank you for that information.

Don’t go anywhere near them, awful daytrading app.

Can you point me to some examples of Mercia being a good administrator of EIS funds?

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