Zoom AAA #6: Ask Adam Anything: Freetrade CEO & Founder, Adam Dodds. 19th May @ 8PM

Hi, its exciting to hear the news of the upcoming plus account and the start of Freetrades path to profitability. As an ISA holder I am keen to know if the plus account features will wrap into the ISA account, or if I will need to hold both accounts to get all features at Ā£3 + Ā£9.99 a month.

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Of the 150,000 cumulative customers, how many have reinvested into the platform more than once? And can you provide us a view of the churn rate of customers that create an account and then become ā€˜inactiveā€™?

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Are there plans to grow the ā€œuniverseā€ at a faster pace? I am aware that the introduction of the fractional shares feature will introduce a long list of new shares but I often post requests and it seems there isnā€™t an active push to get user requests added quickly. There doesnā€™t seem to be much interaction in this space.

Moving forward, could Freetrade commit to expanding the ā€œuniverseā€ quicker, in line with customer demand?

Thanks!

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This may be covered elsewhere so I apologise if so, but is a plan for a browser-based dashboard on the roadmap? For me, makes portfolio managing a touch easier.

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This will, no doubt, be one of the hot topics of the eveningā€¦

With the imminent release of Freetrade Plus and the rumoured Ā£9.99 monthly fee, how do you plan to offer a compelling product that doesnā€™t lessen or dilute your status as the ā€˜simple and free trading platformā€™??

Charging a fee that some people may regard as high could suddenly put you in the same conversation as the competitors you previously undercut so significantly. How confident are you that youā€™ll have a healthy uptake at this price given most people gravitated to the platform because it was free.

Could a more reasonable fee of something like Ā£5.99 / Ā£6.99 ensure you maintain a competitive edge? or could you share the features that justify the rumoured price?

Thanks!

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I have seen on another platform in the US (M1), that you can set a portfolio target % for stocks/funds and then configure to auto-invest to buy the relevant items to keep your portfolio balanced automatically rather than having to buy each individually.

Definitely a nice to have more than essential but it this on the radar? Thanks

Secondly, again a nice to have, but will it be possible to view and create different ā€˜portfoliosā€™, as a way of tidying my investments (i.e. I have a portfolio for growth vs a dividend based portfolio for example)

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FYI all, I did find this, which suggests that the web dashboard may be >6 months out Trello

Questions:

  1. What are the general plans for a liquidity opportunity?
  2. I know many people in Russia/Ex Eastern Bloc countries desperate to get on board with this: Do we have plans to expand into that marketplace and if so can you expand?
    2.1 Do you need presence in that market/are there work opportunities for shareholders connected there with director level/entrepreneurial experience?
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  1. The web based interface seems to be on the back burner (>6months on the roadmap) but I feel like youā€™re really missing a trick here. M1 Finance in the US is a really good example and barometer for how powerful and useful a web based version of the platform could be. Are there plans to use the web version to really push the platform/app in new directions??

  2. Would you introduce some sort of frequent poll or means of feedback from the user base to inform ongoing decisions with the roadmap and universe of stocks?? I think there is a opportunity to approach this in a more engaging and active wayā€¦ just look at the stock request page on the forum, itā€™s static and no one would know if their request is even being looked into following sufficient votes etc

Thanks!

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freetrade is great and getting greater . thank you ā€¦ 1 when will fractional shares hit the uk side of freetrade 2 will you be able to buy whole as well as fractional shares in the near future

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Will the Ā£2 minimum apply to auto reinvesting

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Hi! Looking forward to this.
My two questions ;

  1. Is there any plans to be able to filter on dividends in the activity feed, and also to see these when you click on a stock in your portfolio?
  2. I much prefer Freetrade to Trading 212, however on my youtube channel people never ask me for a referral to Freetrade as it involves waiting. Most tend to just click on the easy Trading 212 link. Do you have any plans to move towards a consistent referral link, in the same way?
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  1. Do you plan to have an app for the Freetrade community forum ?

  2. Will you increase the Apple Pay allowance ?

Can you confirm when the app will support annual tax certificates?

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Hi Adam

Already a committed investor and user of Freetrade. Having delivered a lot of features and achieved trade volume (3rd broker by trade volume) can you tell us more about the route to profitability please?

Hi Adam, I have the following questions:

On the funding:

  1. On your pitch deck, on the ā€œAssumptionsā€ the 2022 customer projection is 67% UK customers 32% EU customers. Does this mean that you are going to prioritize more on the UK market than the EU market? And on a similar note, do you prefer focusing on establishing more your brand in the UK market or reaching for more breadth in the EU market?

  2. Currently the number of people who have an account at Freetrade is about 160K. However the people who are active in the last 30 days are about 40K. Your projection (in the assumptions) is about having about 260K active users at the end up the year. Are you talking about people who are using the app during a month or just people who have an account with you?

  3. Are you also working on VC-backed funding or is this round only open to crowdinvestors? Is this a Series A+ or Series B funding?

On the team:

  1. Could you disclose the annual salary of each of the founding members? If not, could you please disclose the total annual of the whole founding team combined? Maybe this information is disclosed somewhere and I missed it. [It makes a difference if a founder gets Ā£100K per year or Ā£500K per year. I know that in some cases founders tend to have a nominal salary of $1 and then get subsidized in various ways, but it still makes a difference how much they get in comparison with the rest of the team.]

  2. How big is the engineering team? How many engineers are right now versus how many were with you a year ago? How many are the product managers?

  3. What are your hiring plans (as we might be heading in a recession)?

On the community:

  1. There is an active community here in the forums. One way of how startups get new customers is by ā€œeducatingā€ them on how to use their product. Are you planning on providing any form on ā€œeducationā€ on investing in the future?

  2. Do you plan of adding any ā€œsocialā€ feature in the app?

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Very impressive business and team. A few questions below to potentially discuss tomorrow (to the extent it is not proprietary or too sensitive to discuss).

  1. Monetisation strategy:
    a. Can you please provide details on the pricing strategy and roughly what is driving your 2023 projected revenue? What contribution is from interest on cash balances, FX fees on non-GBP trades and subscription fees for non-basic accounts? The plus customer growth on slide 17 implies a lower proportion from non-basic accounts than I expected given the revenue growth - can you please provide the pricing and details of what non-basic accounts will include?
    b. Then in terms of your trading costs, is it possible to disclose what this is per customer and your expectations over time? Are trading costs basically direct costs on slide 15?

  2. Barriers to entry: What are the barriers to entry to prevent your main competitors moving to commission free trading and copying your tech stack? Could they cross-subsidise their trading platform with other products and are better capitalised? E.g. similar to what weā€™ve seen passive investing and a race to the bottom to match Vanguard.

  3. Product differentiation: Can you please discuss how your product is differentiated from your competitors? E.g. low-cost product (supported by a sustainable cost advantage etc.), innovative and simple product (driven by a unique tech stack, agile start-up culture, R&D investment etc.)

  4. Customer acquisition: What strategies do you intend to use to reach 3.4m customers by 2023? What is your view on customer acquisition cost and levels of churn in the industry? I would imagine that customers are expensive to attract but once acquired are quite sticky.

Thanks for hosting the discussion tomorrow.

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Due to recent outcry from competitors, and yours is newly created account, members may have flagged your post as spam. As you mentioned as an investor, ppl expect to have a badge to your profile. Even though its up to you, having a badge relating to the round, you invested.

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  1. What makes you think that a subscription model is a sustainable model to raise revenue in this sector?

Most providers charge per transaction fees which benefit buy and hold investors and those that charge annual fees often offset the cost against trading (Eqi and Interactive Investor)

  1. How do you plan to combat competition from current or new competitors who match your USP of free trading? What would your say Freetradeā€™s other USPs are?
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Quick Q, is the zoom link going to be shared in this thread?

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