Invstr has raised $20 million in a Series A fundraising round. After spending years focusing on money education, the UK-based fintech company has launched a functional trading and banking services platform. These new offerings will serve to challenge an increasingly competitive investing technology landscape, currently dominated by the likes of Robinhood, Webull, and TD Ameritrade. Here’s what you need to know about the company.
What Is Invstr?
Invstr is a fintech company founded by former Deutsche Bank executive Kerim Derhalli, with an idea to build a startup that would democratize finance through technology. Derhalli launched his fintech company in 2012 as a platform where people could learn about investing. Invstr eventually evolved into an investment simulator fintech business designed to educate users.
Then, Invstr also raised another $20 million in its recently closed Series A round, which came in the form of a convertible offering. It is unclear which investors were involved in the most recent funding round for this company, and investment tracker Crunchbase does not specify.
This new funding round comes as Invstr — as the company says it always planned to do — finally delves into trading and banking services. Previously limited to just financial and investing education, the company could disrupt this increasingly competitive sector of the fintech industry. However, the investing business will have to compete against a number of other companies already offering popular investing platforms.
Robinhood is an obvious example. Founded in 2013, the online brokerage has gained 13 million users (including six million in the first two months of 2021) and has signaled a roughly $40 billion valuation as it plans to go public. However, there are a litany of other companies with similar platforms, including Acorns, TD Ameritrade, SoFi, E*TRADE, and more.
New interest was driven to fintech businesses like Invstr, Robinhood, and SoFi earlier this year when Reddit users coordinated to short squeeze the stock of American video game company GameStop, opening up new questions about financial literacy and boosting a broad fascination in investing. Furthermore, the actions of Robinhood during that saga left many aspiring investors with a sour taste in their mouths, looking for alternative investment platforms.
Invstr actually boasts a unique edge as a business that has long prioritized education before action in terms of investing. The fintech business may be able to employ its background to beat out other investing startups, as its offerings to customers are two-fold: a place to learn and a place to invest. It also bodes well for this business that the fintech world is currently influx and ripe for change amid unprecedented interest.