The Trade Republic app.
LONDON – German stock-trading app Trade Republic said on Thursday it had raised $ 900 million in a huge funding round that values the start-up at $ 5.3 billion.
The round, a Series C, was led by US venture capital firm Sequoia, with additional support from new investors TCV and Thrive Capital. Existing shareholders include Accel, Founders Fund and Creandum have increased their holdings.
Trade Republic is essentially the European response to Robinhood. The app allows users to trade stocks and exchange traded funds without paying a commission. Trade Republic earns money with a fixed fee of 1 Euro ($ 1.22 USD) per trade.
Trade Republic recently added a cryptocurrency feature, which launched just as the prices of bitcoin and other digital coins rallied wildly. More recently, the crypto markets have suffered a sharp decline.
Like Robinhood, Trade Republic has benefited from the growing interest of retail investors in the stock market. Earlier this year, use of online trading platforms increased amid volatile trading in GameStop and other stocks promoted on the Reddit WallStreetBets table.
Trade Republic claims that Europeans are flocking to financial markets as they struggle to earn a decent return on their savings due to the extremely low interest rates. The company now has more than 6 billion euros in assets under management.
“Fifty percent of Trade Republic clients, more than 500,000 people, have never invested in the financial markets in their lives,” Thomas Pischke, co-founder of Trade Republic, said in a statement. “We are empowering people to start with wealth creation, which has been overlooked by the big banks for too long, with high fees and opaque products.”
Founded in 2015, Trade Republic has grown rapidly over the years and now has over one million users in Germany, France and Austria. The company currently has more than 400 employees and said it plans to use the new money to expand its business and hire more staff.
The latest cash injection makes Trade Republic one of the most valuable fintech start-ups in Europe. The continent’s tech sector has grown dramatically over the past decade and 2020 was a banner year for investment in European start-ups.