Nutmeg Crowdfunding on Crowdcube

Nutmeg to crowdfund on Crowdcube

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Pre-money valuation on 22nd January 2019 was Ā£200 million, they raised Ā£45 million.

They are still losing a lot of money ā€œNutmeg losses soar to Ā£12.4 million as regulatory costs biteā€

Itā€™ll be interesting to see what the new valuation is, and what their plans are.

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Nice to see Freetrade get a mention in this FT article:

ā€œUK online wealth manager Nutmeg plans to raise up to Ā£10m from its own customers in a crowdfunding campaign this year designed to ride the same wave of popularity that garnered large sums for finance apps including Monzo and Freetradeā€.

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Speaking about Freetrade, if Freetrade were to add pre-made Portfolios like Nutmeg then Numteg could become redundant.

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There is a real chance that with the Freetrade Platform, Nutmeg gets disruptedā€¦

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Also in this article. Great to see Freetrade being referenced as a benchmark :newspaper_roll:

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Worth noting Nutmeg are looking to diversify their revenue streams with international expansion and by licensing their tech and look to be making some headway on this front. Although, I do wonder if Freetradeā€™s ā€œInvestment Platformā€ thatā€™s on the roadmap has similar ambitions? :thinking:

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I donā€™t understand what Nutmegā€™s ā€˜technologyā€™ is?

It seems incredibly simple; they will have a range of ETFs and then match them to an individuals self-selected risk appetite. Itā€™s not like Scalable Capital where they are super-active and have algorithms to actively rebalance.

Anyone have any further detail on this/am I missing something here?

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Hey, ā€œtechā€ is my poor choice of words, but itā€™s clear to see the article says ā€œlicensing its serviceā€ which I assumed to mean the same but youā€™re right in pointing out itā€™s actually probably not on second thought :thought_balloon: Partnersips with others rather than anything fundamentally tech stack related is what seems to be evidenced but the Pitch will surely reveal more.

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Oh yes, Iā€™m not questioning your interpretation! I agree, thatā€™s how I read it too. Iā€™m curious what they mean by that in their own terms.

I canā€™t help but see it as false or overly positive. I canā€™t see them having anything close to proprietary technology, and in terms of portfolio curation they donā€™t do anything an active manager couldnā€™t (smart beta managers are a thing, classic active management but with ETF investments).

Nutmeg was an appealing product in the pre-Freetrade days. Mostly because no one else offered something like them. In fact, as I see it right now their strongest core product offering is their LISA.

Other than that it doesnā€™t seem particularly appealing as an investor, their business model can be easily replicated, and faster-moving companies like Freetrade will cannibalize their customer base.

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I havenā€™t looked at Nutmeg for ages (decent design, active mgmt and highish fees then), but donā€™t they serve a different market? Nutmeg and other robos are serving a Do It For Me market. Vs Freetrade, stockbrokers and other stock platforms who are very much Do It Myself.

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I donā€™t get what has changed since the Goldman valuation in January (Ā£245m) to justify the speculated Ā£1bn valuation?

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I want to like Nutmeg but havenā€™t had a great experience so far with the pension Iā€™ve opened. Glitchy on boarding process and poor customer service. Probably the best UI/UX out there right now though. Hopefully a pension is on the horizon with Freetrade!

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This was an interesting read! Comments are very negative about Nutmeg at the bottom of the FT articles, with guesses on the valuation being between Ā£500m & Ā£1bn and 2-4x the last valuation!

Lloyds, NatWest, Nationwide and Santander all plan to launch (or have launched) Robo-Advisor propositions. Nutmeg needs to partner with these or itā€™s going to really struggle IMO as itā€™s one of the most expensive Roboā€™s out there, so canā€™t compete on price or brand against these.

For FT subscribers thereā€™s some further analysis: Will Nutmegā€™s crowdfunding plans cut the mustard?

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Iā€™ve been fairly happy with my Nutmeg LISA so far, but articles like those above make me slightly uneasy about keeping my money with themā€¦

If Freetrade were ever to offer something similar Iā€™d switch in a heartbeat :eyes:

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If anyone has a campaign direct link pls. post it there, thanks.

I like nutmeg in many ways as itā€™s easy to use, but in reality what they are doing is take a Blockbuster store and digitise it, rather than invent the next Netflix.

Itā€™s just the same old tired investment model, but digitally enabled. I canā€™t seem them becoming a big player as they are likely to be overtaken by new players who do radically reinvent what investing means to the masses.

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I too have a nutmeg ISA which I have invested in for the last few months and introduced me to investing in general. The fees are, naturally, higher that Freetrade but I am not sure how much crossover there is in the market. I think there is a big difference psycologically between sending Ā£100 a month into a fully managed ISA to actually ā€˜spendingā€™ that money on stock in Freetrade.

I am currently on the Socially Responsible portfolio on Nutmeg, and if by next tax year Freetrade has a good assortment of SRI ETFs available I will certainly switch to a Freetrade ISA. However I am not sure how comfortable a lot of Nutmeg (and other roboā€™s) target market would be doing that.

As for crowdfunding, I think at this stage I will save my money for the Freetrade crowdfund rather than the Nutmeg one as Freetrade is where I can most imagine my investments held in the future.

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Just received this rather bizarre email from Nutmeg:

Why would this information be useful to them? It is obviously non-binding etc.

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