Europe’s wealthtech startups are joining the investing rush – Sifted
Gone are the days when those with capital would put it in the hands of wealth managers, who invested on their behalf and simply noted their successes (or failures) in quarterly reports.
A new generation of investors (and some of the older ones too) are demanding more control and accountability and are confident in going it alone, with all the risks that entails.
A proliferation of wealthtech platforms and apps are allowing users to invest for themselves, often commission-free, with just a click of a button, while new wealth-generating assets like cryptocurrencies or non-fungible tokens (NFTs) are spreading like wildfire.
Almost 12% of the UK adult population use at least one investment app
We are seeing a seismic shift in the way people are managing their money and what they invest in.
Europe plays catch-up
A new cohort of startups and investors are increasingly helping to meet changing investment needs.
The US has been the innovation frontrunner in wealthtech, from Wealthfront and Betterment, two market leaders in the robo-advisory industry allowing people to invest in financial products using an automated and low-cost model, to Robinhood, the app that became a phenomenon this year when independent traders used it to boost the value of struggling companies like GameStop — an event that shook Wall Street.
But now European startups are following their US peers into the consumer wealthtech market.
Europe’s wealthtech frontrunners
A clean interface, effective marketing campaign and strong brand have allowed London’s Nutmeg to win market dominance, raising funding from big finance players like Schroders, Balderton Capital and Goldman Sachs as its grown to hold over £3bn in assets under management. The company was recently acquired by investment bank JP Morgan.
Germany’s Trade Republic is Europe’s other big business-to-consumer, or B2C, investment success story. In May, the Berlin-based startup raised one of the biggest investment rounds in European fintech history to reach a $5.3bn valuation.
“Savings and wealth are a multitrillion-dollar market”
Europe is also home to a raft of low-fee digital brokers including Bux, eToro, Revolut and Freetrade, along with crypto and digital asset trading startups like Bitpanda.
A second big trend is B2B startups helping …….