Freetrade: Free Share Trading

This is Freetrade…

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Freetrade is over funded by more than 270% already on first day of closed crowdfunding

Screenshot_20180516-141602

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Not even gone public lol. I saw there was an insane £125,000 investment from someone!

Yes - picture us when we’ll have onboarded the full waitlist. :rocket:

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Followed by an even more insane £175k investment from someone else!

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I’m in again for another round. Still think there’s a tremendous market opportunity there and Freetrade has first mover advantage for the freemium segment (at least in the UK market).

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Is the the UK equivalent of Robinhood?

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Yep!

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That’s how Forbes described them today :slight_smile:

https://www.forbes.com/sites/oliversmith/2018/05/16/britains-take-on-robinhood-is-crowdfunding-1-3m-to-bring-no-fee-trading-to-europe/

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Robinhood but without leveraged trading products, and so a focus on longer term investing.

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We’d better get the drinks in at 40 Greek Street for the team!

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What’s the advantage in investing now? My understanding is that this would be a very long term investment (like Monzo)?

Is it very difficult to sell shares bought through CrowdCube?

you’re on point like Alex! The man with the links!

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@nickh the primary advantage of investing now is the relatively low buy in price of 54p a share. The current valuation based on this round is £18m, and that’s without any customers onboarded and trading! As they onboard those on the waiting list, grow users, and hit their KPIs that valuation is likely to increase significantly, thus making subsequent rounds more expensive for you to buy in to. That’s the primary advantage of getting in early, but early stage investment = far higher risk.

In terms of ease of selling shares you’ve purchased via a crowdfunding platform you’ll have three primary considerations:

1. Whether the articles of association permit a transfer the best thing to do is request documents from the company if you’re Crowdcube registered, or contact them directly for clarity on this point. Definitely join the Freetrade community though, the team are active on the forum and are very helpful and transparent.

2. Liquidity. Crowdcube doesn’t have a secondary market at the moment, so you’ll likely* need to work a lot harder to find a buyer. Seedrs do have a secondary market, but again the liquidity isn’t really there unless you’re looking in unicorn territory (hopefully Freetrade is on this trajectory)

3. Valuation WRT to Seedrs, there’s no bidding. Shares are traded at fair value, which is the price at which they are marked pursuant to the platform’s own valuation policy. This might be a good model for Crowdcube originated transactions, though there’s no hard and fast rule on this AFAIK. This link explains Seedrs’ ‘Fair value’ policy in a fair more succinct way than I possibly could. Seedrs Valuation 101

With that in mind, you should view such an investment as long term with a high chance of losing your capital investment entirely. For every unicorn out there, there are 20 turkeys - not an official stat, but you get my point! Now, where did I put the cranberry sauce?!

*if Freetrade explodes, and you are permitted transfer shares, you could have people on various different forums asking to buy shares from investors - this has been the case with Monzo, Revolut and others.

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Awesome reply - Thank you

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Hey Christopher,

So I invested today (a mere tenner) but I wanted to test crowd cube ahead of Monzo’s next offering and I figured it was worth a punt as I like the freetrade idea.

Are you saying I have bought approx 18.5 shares with my £10?

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@WillSK hola,

Congratulations on your first Crowdcube investment, and on your investment in freetrade.
It’s a very exciting proposition!

Essentially yes, 18 shares approximately. Once funding has officially closed and the Ts are crossed and Is dotted, you’ll receive your statement of beneficial ownership, which will state the precise number of shares you own. :rocket:

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for those that wanna invest, it will be closing in the next £50k or so (cap at £3.1m) - https://www.crowdcube.com/companies/freetrade-2/pitches/b3M2Ql

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Just invested and joined the waiting list. Thanks for sharing this @Tommmy!

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Congrats Dan! Make sure you stop by the Freetrade Community for new updates :slight_smile:

Update: the Crowdcube round is now fully funded at £3.1m

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