London-based online trading platform Freetrade said it’s bought the UK customer base of Australian investing app Stake as part of a strategy to strengthen its domestic presence in an increasingly competitive market. The move follows rising competition from new entrants, particularly the US giant Robinhood.
Freetrade said that it takes all the client’s assets, in addition to its customers, which Stake used to manage in the UK. The two firms have not said anything about the financial terms and conditions of the deal, with regards to the value of Stake’s UK customer book. Nevertheless, the deal is considered by many as a strategic move towards improving Freetrade’s market position.
Stake was launched in 2017 and is based out of Sydney, though it is purported to offer low-cost brokerage for the most part to retail investors. In 2020, the company expanded services to the UK but has since decided that it will refocus its operations back to Australia and New Zealand as part of a review of its business.
Customers based in the UK will receive a guidance on how their assets and funds will be transferred over to Freetrade. Stake users, however, can continue using it until November when this process is complete.
Freetrade is based in the UK but it has set its sights on the European Union. Freetrade features various investment products, such as stocks, exchange traded funds, Individual Savings Accounts and Government Bonds. To date, as of April 2024, Freetrade reported to have over 1.4 million users.
The firm recently reported its first ever half-year profit in 2024, with adjusted earnings at £91,000 and 34% revenue up to £13.1 million even though it faced a tough market environment that influenced a 15% reduction in workforce last year across with the value falling drastically.
Freetrade chief executive Viktor Nebehaj said, “I’m focused on scaling Freetrade into the leading commission-free investment platform in the UK market.” He added that this deal was “integral to being able to execute true inorganic growth while ensuring a seamless experience for Stake’s UK clients.” Freetrade already handles more than £2 billion in assets for UK customers.
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