The current funding slump is a difficult situation for local fintechs. The reluctance of investors and financiers makes it difficult for them to drive innovation, growth and collaborations. The Berlin-based company Upvest is defying this trend and last year not only reported an investment of 42 million euros, but since the beginning of this year also a series of cooperations with strategic partners to accelerate growth. In addition to Ginmon, Vivid, Revolut, the French social trading app Shares, now also relies on the Berlin infrastructure fintech around founder Martin Kassing.
Similar to eToro or Wikifolio, investors can exchange information about investments in groups in the Shares app and buy shares directly there. Since its launch in 2021, the high-flyer from France has already raised USD 80 million. Among the prominent supporters are Valar Ventures around Peter Thiel and Rocket Internet. Shares also received a great deal of media (marketing) attention, not least due to the entry of the two ex-tennis pros and sister duo Serena and Venus Williams.
Access to ETFs and European equities
With Upvest ‘s API solution, Shares customers can now access ETFs and European equities, similar to Revolut, including the ability to invest in corresponding fractions. Upvest’s API solution includes brokerage, settlement and custody services. Companies can integrate the API into their existing infrastructure, so in-house development is no longer necessary.
What does the further cooperation mean for Upvest? The partnership with the French fintech seems to be a consistent continuation of the previous growth strategy. After receiving funding from Earlybird, HV Capital, Notion Capital, ABN AMRO Ventures, Speedinvest and Partech, Upvest was one of the few German fintechs to receive five licenses from the financial supervisory authority in March of last year, which enable securities trading and crypto custody, among other things.
Upvest geared to further international growth
“Upvest was designed to grow internationally from the very beginning,” Kassing says in an interview. This seems to be succeeding. The founder continues, “That’s why we are very selective in choosing our cooperation partners.” What is striking here is that Upvest focuses primarily on partners with a large customer base and/or with a lot of capital. The calculation behind this should be simple: if the customers are successful, so is Upvest.
Shares had initially focused on the highly competitive and difficult French market. Only in the next step did the fintech focus on the UK. With all the marketing power of the Williams sisters, the aim now is to enter the market in Germany and beyond.
Meanwhile, the partnership represents a strategic move for Upvest: With the European roll-out, Upvest wants to accompany the growth rate of a rapidly scalable company.
Competition through cost reduction
This year’s partnership probably won’t be the last. Upvest significantly reduces the costs per trade compared to core banking systems or in-house solutions, so that the software solution from Berlin is likely to become interesting for additional customers and target groups, including those from the microportfolio and fractional investing sectors. Established players such as Scalable and Trade Republic could thus face further competition.