Sydney-based digital brokerage business Stake has raised an additional $50 million as it caters for the next generation of Australian retail investors, many of whom are locked out of the property market and not helped by the current negligible interest rates.
The Series A extension round included support from US-based Tiger Global and London-based DST Global, both of which led the initial $40 million Series A investment in May 2021.
Founded by Matt Leibowitz and Dan Silver in 2017, Stake was the first Australian company to offer commission-free trading in US stocks and has since built up a global customer base of over 500,000 people, now with $2 billion in funds under administration.
“This funding allows us to accelerate and continue to deliver on our mission to provide unrivalled access for next-generation investors,” Stake co-founder and CEO Matt Leibowitz said.
“We have been truly humbled to receive continued interest from top-tier global investors as they witness the impact that Stake is having in the market.”
“Regardless of the market conditions, we remain laser-focused on providing the best access to financial opportunities for our customers. We’re building an investing experience for the next generation of investors, and we’re excited to put our time and energy into redefining how Australia invests,” he added.
After studying to become a lawyer, Leibowitz changed direction and started trading at high-frequency Chicago-based trading firm Optiver. Progressing to partner, he ran both its equities and the institutional trading desks in Sydney, where he was shocked by the sector's excessive fees and poor customer experience.
Pioneering $0 brokerage fees and opening access to Wall Street, the business offers its customer base in Australia, New Zealand, the UK and Brazil a seamless way to invest in more than 8,000 stocks across US and ASX markets.
Paying heed to its customers, who are looking for access to a diversity of investment opportunities, the business plans to enter the crypto space before the end of the year.
“In an environment where many online brokers are facing headwinds, Stake has continued to go from strength to strength,” Leibowitz said.
“The growth in our customer numbers and asset base continue to outpace last year, and we’re blown away, given it has been a much tougher macro environment.
“This is a vote of confidence from both customers and investors in what we have delivered and what we are building towards.”
The business released findings from market research conducted in September 2021. After interviewing 1,000 Australian investors between 18 and 45, Stake found that a rise in retail investment is coming from a generational shift towards wanting to be self-directed and independent.
Referring to these investors as ‘Generation I-nance’, the report found that 76 per cent of investors between 18-29 want to be their own boss. The research found that online communities share research theses and discuss trade ideas, with 87 per cent confirming they would consult an online source before making an investment decision.
The research also found that women are just as likely to be self-directed investors as men, with over half of all young female investors holding stocks as they forge a path towards financial independence.
“We're excited to be part of what Stake is building and to support the company in the next phase of its journey,” Tiger Global partner Alex Cook said.
“From day one, we’ve been impressed with the team’s focus on better customer outcomes and the innovative ways they connect their customers to the markets.”
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support