These are our candidates for the “FinTech of the Year” : Scalable Capital GmbH
The industry has grown up and has long outgrown its infancy. There are so many companies that shape the industry but not all of them are equally well known. Who are the companies that are the glue between finance and digital technologies?
We still consider it important and relevant to give an award to the most interesting and most relevant German FinTech/Startups. An award from the industry in which we are all active, for the industry. Not bought, not externally influenced, reserved for our independence. As we are diverse and furthermore everyone has different views and focuses, this has always resulted in a good mix. The nominations come from the heart, but the final evaluation process is done by us and is completely detached from us.
At this year’s presence event, the Transactions 20 conference in February 2021, we want to set the price for the Fintech of the year 2020 to lend. In total we have 15 Fintechs nominatedwhich the jury will evaluate in the next weeks according to certain categories. As every year, you are in demand as a strong voice of the Fintech community to give out the audience award through your voting. The voting will start soon, but first we would like to give the nominated companies the opportunity to introduce themselves.
For private persons we offer scalable capital a digital asset management, a broker with a trading flat rate as well as overnight and fixed-term deposit offers
Digital asset management: In the field of digital asset management, the company creates and manages globally diversified ETF portfolios for its clients, composed according to individual risk tolerance, with sustainable investment strategies if desired.
Online broker: The broker is aimed at self-decision-makers and offers them the opportunity to trade shares, ETFs and funds as well as to conclude ETF savings plans on over 1,300 ETFs.
Daily and time deposit offers: For short and medium-term investments without capital market risk, Scalable Capital offers access to attractive overnight and fixed-term deposit offers.
The customer can view all portfolio details such as performance, shifts made or fees incurred at any time, via app (iOS, Android).
B2B partnerships: For B2B partners Scalable Capital develops solutions for digital investment. Among the partners are the direct bank ING, the British Barclays Bank, Siemens Private Finance, the digital subsidiary of the Santander Group Openbank, the Oskar GmbH and the Targobank.
Facts and figures about Scalable Capital
- distribution channel: B2B and B2C
- Target group: private and corporate customers
- Country of destination: Germany
- Status of financing: Series D
- Further financing planned?:not yet clear
- Name of the product(s):
“Europe’s leading digital asset management company creates and manages its clients’ personal ETF portfolios.”
The business model of Scalable Capital
Scalable Capital is a leading Fintech in Europe, bringing together people and technology-based investment.
Digital asset management: Scalable Capital manages individually tailored and globally diversified ETF portfolios for its clients for long-term asset accumulation. Clients can choose between portfolios with sustainable investment strategies or classic portfolios with dynamic risk management.
In terms of sustainable investment strategies, we offer two options – “ETF Sustainable Asset Management” and “ETF Sustainable Asset Management – With Gold”. In both cases, the client receives a managed, globally diversified ETF custody account with full service. We constantly monitor the ETF market, compile a portfolio from the most attractive securities in accordance with the client’s risk specifications and manage it for him. Clients determine their equity exposure individually in steps of ten percent – up to 100 percent for the first time if desired. They can also add gold investments to the portfolio. When selecting ETFs, Scalable Capital pays attention to high ESG standards.
This means that ETFs must meet certain environmental, social and governance standards. We also pay attention to criteria such as global diversification, high liquidity, low costs and a low tracking error. The ETFs we use are constantly reviewed and, if necessary, exchanged for other ESG-compliant ETFs that perform better in terms of liquidity, return and cost. The total cost for both options is 0.90 percent per year. This includes the service charge of 0.75 percent and external costs for the ETFs and ETCs of 0.15 percent.
For our portfolios with dynamic risk management, each client is assigned one of 23 risk categories with a specific risk of loss, depending on the investment objective, financial situation and individual risk tolerance. Scalable Capital selects the best and most cost-effective ETFs from over 2,000 ETFs completely independently for its clients. A specially developed risk management technology regularly monitors all portfolios and automatically carries out reallocations if there is a risk of violation of the individually defined risk category. Risk management is dynamic, as there is no “rebalancing” to static weights per asset class, but instead the portfolio risk is kept as stable as possible by flexibly adjusting the weights. The registration procedure is online and completely paperless.
The identification is carried out by the VideoIdent procedure. The customer can view all portfolio details such as performance, shifts made or fees incurred at any time, via app (iOS, Android). We offer this service, which completely relieves our customers of the investment of their money, for a fee of only 0.75 percent per year, plus approx. 0.15 percent for the costs of ETFs;
Online broker: With the online broker Scalable Capital offers a digital platform for securities trading. Private investors can use it to control their asset accumulation themselves. There are three models in Brokerage: The “Freebroker” model is free of charge and includes a free ETF savings plan. Each additional transaction or savings plan costs EUR 0.99 each. The “Primebroker” model offers a trading flat rate for EUR 2.99 per month, which includes all transaction costs and any number of ETF savings plans. The “Primebroker flex” model offers the same scope as the Primebroker. The difference here is that the monthly fee of EUR 4.99 is debited monthly instead of annually as in Primebroker. In addition to the apps for iOS and Android, the web application is also available to customers for trading and portfolio management. The registration procedure is online and completely paperless. The identification is carried out by the VideoIdent procedure.
B2B partnerships: For B2B partners Scalable Capital develops solutions for digital investment.
Scalable Capital: the founders & investors
Scalable Capital was founded in 2014 by Erik Podzuweit, Florian Prucker, Adam French (most recently Goldman Sachs) and Professor Stefan Mittnik (Chair of Financial Econometrics and Director of the Center for Quantitative Risk Analysis at the Ludwig-Maximilians-University in Munich).
Erik Podzuweit: Erik has many years of experience in the financial sector and in building digital business models. Most recently, he was Co-CEO of Westwing Home & Living in Germany. Prior to this, Erik worked for seven years as Executive Director at Goldman Sachs in London and Frankfurt. There, he was responsible for the investments of financial institutions and for an electronic trading platform. Erik studied business administration and economics in Kiel and Warwick and taught as a tutor in statistics and econometrics.
Florian Prucker: Florian worked for over eight years in the financial sector in New York, Frankfurt and most recently in London. As Executive Director of Securities Trading at Goldman Sachs, he accompanied the development of a pan-European electronic trading platform for private investors. Prior to that, he was responsible for private banks and asset managers in Germany and Austria for the American bank. Florian studied business administration and electronics at the Technical University of Munich.
Adam French: Adam co-founded Scalable Capital after realizing that everyone deserves better when it comes to access wealth management services. It was clear that technology could provide a professional service that was more convenient and cost-effective than ever before. Prior to founding the company, he spent seven years at Goldman Sachs as Executive Director of Commodities and Derivatives Trading. Adam was named one of the PAM Top 40 under 40 in 2017. He studied business mathematics and statistics at the London School of Economics.
Prof. Dr. Stefan Mittnik: Stefan is Professor of Financial Econometrics and Director of the Center for Quantitative Risk Analysis at the Ludwig-Maximilians-University in Munich and Fellow at the Center for Financial Studies (CFS) in Frankfurt. After completing his doctorate in the USA, he taught in New York and Kiel before moving to Munich in 2003, he was a member of the Research Advisory Board of the Deutsche Bundesbank, a member of the Review Board of the German Research Foundation, as well as Research Director at the CFS and Ifo Institute and held several guest and honorary professorships in the USA. For about 30 years, he has been researching questions of analysis, modelling and forecasting of financial market risks and has developed procedures that focus on empirical relevance instead of financial mathematical elegance.
Shareholder: The shareholders of Scalable Capital include BlackRock, Holtzbrinck Ventures and Tengelmann Ventures.
Milestones: what Scalable Capital has achieved so far
- February 2016 – Market launch in Germany
- July 2016 – Scalable capital expands into Austria and Great Britain
- January 2017 – Siemens Private Finance cooperates with Scalable Capital
- June 2017 – BlackRock acquires stake in Scalable Capital
- September 2017 – ING Germany starts cooperation with Scalable Capital
- May 2018 – Scalable Capital breaks through the billion barrier
- September 2018 – Scalable Capital wins Openbank, the digital bank of the Santander- Group, as partner in Spain
- August 2019 – Scalable Capital expands the range of products to include overnight and fixed-term deposits
- December 2019 – Scalable Capital breaks through the 2 billion barrier
- March 2020 Scalable capital cooperates with Raiffeisen Banking Group
- June 2020   – Launch of Scalable Capital’s online brokerage
- July 2020   – Scalable Capital cooperates with Barclays
- July 2020 – Scalable Capital cooperates with Gerd Kommer
Successes in 2019/2020
In 2019, the absolute highlight was the crossing of the 2 billion euro mark in customer assets under management. This trust of our clients in our product honors us and is also our greatest incentive.
In the current year 2020 there have also been some highlights so far. Firstly, there was the cooperation with Barclays, one of the largest banks in the UK and worldwide. In addition, we launched our online broker in June, which enables investors to build up their assets themselves.
What makes Scalable Capital so special?
Our mission is to revolutionize and democratize the investment of money. Within a few years we have become Europe’s largest digital asset manager. With our online broker, we enable cost-effective entry into self-determined trading on the capital market. But we are not resting on our laurels – on the contrary, they are an incentive on our way to offer private investors a fair, convenient and inexpensive alternative for long-term asset accumulation;
What makes your team?
A decisive factor for the great development of Scalable Capital is our international team of already more than 140 employees; our employees come from Germany, Europe and South America.
Where do you see yourselves in the future?
Our goal is to become the “financial home” of our customers. We want to make all areas of investment easier, better and cheaper through smart technology. We want to launch innovative features in our broker in particular and reach new customer groups.
We are in close contact with our customers and use many channels to inform them about market trends and our products. Because for us, “digital” does not mean “no one there”. Interested parties can learn more about Scalable Capital through these channels: