Melbourne fintech SelfWealth has floated on the Australian Securities Exchange, raising $7.34 million through an initial public offering.
Based on the $0.20 IPO price, the company has a market capitalisation of $26 million.
SelfWealth operates a share-trading platform that allows users to buy and sell any volume of shares for a flat fee of $9.50 per transaction. No monthly fees are charged, although an optional $20 “premium” tier is available for deeper market analysis and access to a “social investment network”.
The company did not disclose current customer numbers, but founder and managing director Andrew Ward in last year revealed the platform had 3,000 self-managed superannuation fund clients plus 2,500 direct users.
“It is an audacious goal, but within the next 12 months we are hoping to have 100,000 online trading accounts,” Ward said at the time.
SelfWealth raked in $137,000 of revenue for the 2017 financial year, while posting a loss of just over $9.8 million.
Ward, who is a former Commonwealth Bank private wealth director, said that since the startup’s establishment in 2012, he has seen “a shift away from bank- and broker-owned platforms”.
“In our view, the next generation of investors want to work with independents, and ultimately hold control over their own portfolio. And that’s what we give them.”
He added that the capital raised from the IPO would be used to expand its user base, further develop the platform and create new products. The company also stated its marketing and advertising budgets would be “tripled” using the new cash.
“We are excited by the interest and support shown from investors and are delighted to officially list on the ASX,” said Ward.
The company stated earlier this month that it had more than 400 existing investors, and addressed criticisms from some of them that the IPO was premature.
“A lot of people may say that we’re floating a little early. But when we started the process of commercialising the business towards the end of last year, one in five people asked us ‘who is Selfwealth and are you a viable business? If I give you my money and start trading, will you be around?’,” Ward told Fairfax Media earlier this month.
Reaching the 100,000 user target would give the fintech a 15% share of the roughly 700,000-strong online trader market in Australia.
“Then we will have CommSec in our sights,” Ward said last year.
“Banks are also charging too much [for broking], and to me percentage broking fees seemed wrong and immoral. I thought there had to be better way do it.”