Revolut Free Trading Tweet? 🦅

I did include Revolut in the valuation section as a comparable UK company as there aren’t any other challenger stockbrokers to benchmark against. I included Monzo, too.

First-mover problems :man_shrugging:

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Indeed.:1st_place_medal:

Would love to hear some speculation on what their effort could entail. I’m hoping Revolut Free Trading remains perennially “coming soon” like Revolut Wealth. I’m a conflicted R3 shareholder now after all :smile:

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Would love to hear some speculation on what their effort could entail

Think you’ve already cut to the core of it above:

I’ve referred elsewhere to robo-advisors being a ‘software layer’ above existing infrastructure, and all of the public evidence points to Revolut doing the same here in terms of offering the services of an existing stockbroker (and/or ETF manager) through a shinier app.

Granted, Revolut are a software layer on steroids compared to robo-advisors and if they can give these services away for ‘free’ (although let’s not kid ourselves that it won’t be Premium only for the foreseeable) and with individual stocks it will be interesting to see.

But:

They don’t seem to want or need any of this for the same reasons they’re content with being a prepaid card whereas Monzo has a full banking licence (Lithuanian stockbroker licence coming soon to an app near you :joy:). They’ll be outsourcing the regulatory minimums to existing, old-world firms like the robo-advisors do and just like they do with their overdraft (LendingWorks), insurance (standard intermediation / broking), pensions (PensionBee) and current account technology (powered by the MasterCard issuer Prepay).

This makes their approach fundamentally different to Freetrade.

Question - when does this model simply become an opaque marketplace without any choice over what vendor the user is contracting with? Just because they can keep it ‘free’ should not excuse them from being clear about this, and they’re already on thin ice in terms of passing these services off as ‘by Revolut’, potentially disingenuously. If I have a complaint about any of these services, who should I count on to resolve it?

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The instinct to take shots at Revolut for moving into more direct competition with Freetrade is a little silly. They are just another startup, doing very well, and their strategy to expand so rapidly into new products clearly works for them.

It’s doesn’t make a lot of sense to feel threatened by their stock trading offering. As a dedicated platform, Freetrade is very likely to perform that function better, offering a better customer experience, and more useful education. At that point Revolut is just a tool to get a huge number of people interested in the concept of stock trading.

I like Revolut, I use it as my day-to-day account. I have premium, I use the overseas insurance, I use the multi-currency accounts, and the opportunity to lock in a good exchange rate, disposable cards are useful, so is global delivery… Basically I like the features related to the core function of Revolut - travel and international payments. I played with buying crypto there, but I’ll stick to Kraken/Coinbase. I played with Vaults, but I’m very likely to stick to Moneybox for saving. I will play with stock trading on Revolut, but almost certainly I will be focused on using Freetrade.

And that’s fine, for everyone. Revolut will use their feature creep to get the low-hanging fruit as always. Freetrade, like the other more specialised products, will attract the people with a specific interest in what they provide. The ‘us vs them’ mentality is silly.

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Great post. Just to respond to the question, I’m a satisfied user of Revolut and can confidently say that their ‘marketplace’ is transparent. The “offers” they provide always provide clear & simple T&Cs in my experience - particularly signing up to Pensionbee & using their crypto exposure service. It’s the customer’s responsibility to know and agree to what they’re signing up for and to raise any complaints in line with the terms of service.

I reckon this will launch as a Premium service for sure, but with ways to unlock it for standards users. This is what they did when they launched crypto: standard users had to make 3 successful referrals which I was happy to do.

I’d be interested to know who they may partner up with to provide zero commission trading and whether it will be real or synthetic.

@dan I agree with your post too :fire: Interesting prospect you mention with Revolut is they can leverage their large installed user base to use their product upon launch.

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I’ve said as much here. The more public attention drawn to cheap / free investing the better.

As for shots against Revolut, many people come here, amongst other things, to find out about the nuts and bolts of building a stockbroker.

A core part of our narrative is identifying, explaining and educating on why incumbent stockbrokers are not doing as well as they could for their customers, and especially millennials. If I can find synergies in this with the approach of other fintechs (as I have ad nauseam on robo-advisors), I think it is worth pointing out.

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Thanks - good to know. Not an active user myself, but that may change when they offer crypto as cashback on card purchases (rumoured feature).

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And also connect into the likes of Xero and Sage to do the backend accounting…

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For sure, you’ve presented the kind of rational evaluation I would expect from someone engaged in building a stock trading product. Your linked comment was a good read, also.

My comment was more aimed at the tribalism that occurs in any comment chain where Revolut are invoked in the name of ‘competition’. It’s not helpful - there’s much that can be learned from other products, and certainly no reason why we can’t make use of both.

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As @adam said, we had showed a sample of the market, but Revolut had not announced their plans at that point. And it’s not really good form to sort of leak someone’s plans (EDIT: especially if not confirmed), while they surely prepared a baller accouncement for what would be the right time for them (and they just did it in Amsterdam now :clap: ).

Nevertheless, we tend to be extremely transparent, so Adam was very clear in his Forbes interview in terms of where we’d expect more meaningful competition from:

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Shareholder interests trump “good form” surely? :smile:

I hate to say ‘I told you so’ but I began the Revolut Wealth topic agreeing with @adam comments in that interview but nobody was willing to consider Revolut as a viable threat.

@dan this sums up Revolut’s model to a T. Low hanging fruit, white label products provided by others, who will take their cut a long the way.

But reading between the lines, it feels like speed to market is more important than doing things ‘the right way’ cf. Monzo, who came under heavy, sustained criticism for not ‘innovating’ hard or fast enough. Whilst Revolut was charging a lead and offering a racy basket of products, Monzo was building a bank (in the regulatory sense) from the ground up, to provide an agile yet robust core product. To me that’s the real innovation, as opposed to sticking your UI on top of Mambu (looking at you N26!)

As @freetrade_cal pointed out

and ( incoming :bomb: ), offshoring their banking authorisation to a potentially less robust regulatory environment. Revolut certainly aren’t alone in this m.o. but again, a picture of shortcuts emerges.

Does this even matter to customers? The honest answer is probably not to most people. But for me getting the essentials right is important, and is certainly not incompatible with building innovative, paradigm shifting businesses that are in it for the long haul - as customer and investor that’s where I see value.

Totally, and they are seemingly doing astoundingly well from valuation, transaction volume, and customer acquisition perspectives, and this should be recognised and congratulated. But customers, investors, markets, people essentially, can be fickle things. Clearly, Yuri Milner knows something I don’t :sunglasses:

Also, I can’t speak for anyone else, but I don’t necessarily consider the comments and criticism as taking shots per se. It’s really all part of a robust conversation around an incredibly exciting, fast moving industry. A point I make quite often is that as customers of, and investors in these businesses, it’s important we have visibility and understanding of how they operate and the potential ramifications of their choices they make. It’s not a game, it’s ultimately people’s money and their futures.

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No need to wait for Revolut, this one’s for you @freetrade_cal !

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They operate a freemium model with many customers willing to pay for the premium product. Are these also “low hanging fruit”? I would say no.

The jury is out on what they “right way” will be or even if there even is one way of disrupting an industry. I just have a strong dislike for those who praise Monzo and simultaneously discount what Revolut are managing to do.

Is Lithuania a less robust regulatory environment? They’re a member of the EU which is more than can be said for the U.K. next year.

And they can even be more sticky. The Big 4 oligopoly in professional services, the Big 6 energy suppliers, The Big 4+ legacy banks, the Magic Circle law firms, etc all benefit from customers not being ‘fickle’ enough.

There are definitely thinly veiled & often quite explicit shots imho (more so in the Monzo Community where tribalism is noticeable). The debate here is somewhat robust so far and I’m hopeful this won’t turn into an echo chamber of groupthink as it grows larger.

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Yes, it is. It’s described as a “favourable regulatory environment” if you’d research it.

It’s exactly because the debate is robust that we don’t think we’re going to be anything like an echo chamber. It’s not an echo chamber when a majority of people seem to agree on a view for well-argued reasons but also willingly engage with the counter-argument.

Revolut has some awesome things going for them (round 1 investor here :raised_hand: although I sold my shares since). I like their velocity. But we think very differently about

  • focus
  • building fundamentals
  • aligning with our customers

, and a host of other things. Which is fine. And if you prefer their approach, that’s fine too - I’m a Monzo fan, and the above comes across a bit like:

giphy

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And this doesn’t come across as (insert your exact same dog gif here)?

Pot calling the kettle black.

@CTE apologies if my response was interpreted as a rebuttal. This wasn’t my intention at all; please don’t take it that way or anybody else. I’m all for civil debate which I thought my response was. Apparently I’ve appeared to have crossed a line. Will take it on board.

Btw I’m also a Monzo fan, but my point was I don’t let this obscure my judgment like some others do (my observation of strong selection biases, not an attack). There is a subtle difference between brand loyalty and rose-tinted glasses that some super fans in the Monzo community wear. I was speaking generally and wasn’t referring to CTE as one of those people just to clarify. But hey, this is just my opinion.

This is invetiable in my opinion as it’s the Freetrade community. I’m sure you wouldn’t claim not to be biased in Revolut’s favour in this point either. But if we accept the fact that some users here have a personal preference & stick to discussing the merits of different ideas / facts - both positive & negaive - about the different offerings then I don’t see why that should be a problem :slight_smile:

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This is your favourite line :joy: Glad you’re back ahem but as you know we don’t see eye to eye (previous in the Monzo community) so I’m not going to go off topic anymore than we have discussing this.

I’ve said my peace. I believe this community is great; I was just talking about being mindful of groupthink in the future as it grows. Anyhow this is something for you as forum leaders to figure out and I’m sure you’ll get the balance right :slightly_smiling_face:

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The answer to all your problems. Invest in all three. Monzo, Freetrade and Revolut. There will always be more than one player in the market, and as of today, in the disruption play, all three are on my watch list.

Just hanging out to get on to the Freetrade platform and start investing…

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