On the latest episode of the BankNXT Fintech Podcast, Adam Dodds of Freetrade talks about his journey into becoming a “challenger stock broker”, and how recent FCA authorisation means the future of his company is on the rise.
We talk about Adam’s background as an accountant at KPMG, and how his earlier experiences with banks led to the genesis of the idea of creating Freetrade. Of course, it was a process that took a couple of years of mulling over the pros and cons, but Adam’s optimism and determination to make things easier for millennials (and older folk like me) to trade using our smartphones led to raising just over a million pounds through Crowdcube.
“There’s people who want to invest in the stock market; they know it’s a good idea; they know they should be earning more from their savings than what they get from their savings account,” says Adam. “They’re intimidated by the barriers – whether that’s usability, cost or simply being complicated through the incumbent stock broker. We want to simplify everything. We started out with the idea that it should be just as easy to buy shares in Facebook on your iPhone as it is to download the app from the App Store. That was our starting point. We’ve gone from there and looked at why it’s so complicated – to research a stock and figure out how to buy it. I think it’s a lot of jargon and unnecessary stuff the industry has been used to for so long.”
I ask Adam about when he first got the inkling to start his own business, and where the confidence came from.
“I don’t know if you have a brokerage account in this country [UK], but they’re all really, really dated and with horrendous interfaces, and everything’s kind of web-based,” he says. “It feels like everything was designed in the year 1999 and hasn’t changed since then. And the pricing is just insane: £10 or £12 to place a trade, and then £10 to sell that security … it just makes it non-viable to invest in relatively modest amounts.”
To end the show, Adam reflects on investing in general, and how the industry has changed and is changing, and is pleased that Freetrade will play its own significant part.
Thanks again for listening in. I’m always open to discussion about who you think I should reach out to next, especially if they’re doing something exciting in fintech. Please leave your comments below, or contact me on Twitter. You can catch other interviews on this page.You can subscribe to this podcast on iTunes.