- New Zealand investment platform Sharesies is planning to spread to Australia and the Australian securities exchange (ASX) in the coming months.
- Offering a low-cost sliding commission structure to trade companies listed in New Zealand, the United States and soon Australia, the platform is geared towards making investing more affordable and accessible regardless of cashflow.
- “We’ve made sure that the minimum investment barrier is completely removed so you can literally start investing with one cent,” co-founder and co-CEO Brooke Roberts told Business Insider Australia.
- Visit Business Insider Australia’s homepage for more stories.
Sharesies is set to promote a very different style of investing when it lands in Australia.
“The majority of people aspire to be an investor but a lot of people feel like they can’t be for three key reasons,” co-founder Brooke Roberts told Business Insider Australia.
“The first is they feel priced out as they think you need heaps of money to get started and secondly, they feel ‘jargoned-out’ because the whole industry is made to seem quite complex. The third is that they feel left out because financial institutions have really only targeted and catered for the wealthy few and not everyone else.”
It’s this dynamic that Robert and her five co-founders want to break for Australians when they arrive in the coming weeks, as they have to more than 330,000 other customers.
The formula is, at least in theory, a simple one. Provide a sliding commission-fee structure that encourages regular investment, no matter how small.
“We’ve made sure that the minimum investment barrier is completely removed so you can literally start investing with one cent,” Roberts said.
“Our ethos is we want people to be able to build their portfolio one day at a time with amounts they can afford.”
Customers are charged a small subscription fee, based on the size of their portfolio, and a percentage of each trade. For example, a customer trading $30 would pay a 15 cent commission on Sharesies. Compare that to Australia’s largest platform CommSec, where you’d pay a flat $10 brokerage fee, and the selling point is clear.
The pricing structure may help smaller investors get started in the market for the first time. It also encourages users to dollar cost average, or regularly invest the same amount of money over a long period of time, a superior investment strategy than trying to time the market in vain.
‘Everyone deserves an equal opportunity to build wealth’
Sharesies was conceived in Wellington in 2016 by six friends who are all still part of the business.
They include the company’s current chief technology officer (CTO), product engineer, and chief designer, as well as Brooke, her husband Leighton Roberts, and Sonya Williams, the ‘three-E-Os’ at the helm of the business.
It’s since expanded from the New Zealand stock exchange (NZX) to the United States, allowing New Zealand residents to invest on both markets.
Working before at state-owned KiwiBank and accounting software darling Xero, Roberts says the genesis of the business was in seeing young New Zealanders priced out of another market.
“At the time, homeownership was starting to feel really unattainable for a lot of people, and there was a prevailing feeling that there wasn’t another way for people to grow their wealth,” Roberts said.
“The six of us had a range of experience in finance and design, and we all rallied around this ethos that everyone deserves an equal opportunity to build wealth, whether they have $5 or $5 million.”
Planning to open to Australians in the coming weeks and incorporate ASX trading, the platform could expect similar tailwinds to help it grow across the ditch, with thousands of people on its local waitlist already.
More than just a low-cost broker
It will face plenty of competition however from the likes of Stake and eToro which offer free US share trading and Superhero, which offers commission-free trading of exchange-traded funds (ETFs).
However, Roberts says low-cost is just one part of the appeal of what she says is really a “wealth development platform”.
“We’re really focused on building confident and motivated investors, which is a big difference compared to what I see out there,” she said.
Education looms a major challenge for investment platforms. By offering a steady flow of information and investing content, podcasts and webinars, Roberts says that while Sharesies “is for everyone”, it is trying to financially empower those who have otherwise been left behind.
It appears to have done a good job reaching them so far. Very nearly half of all Sharesies investors are women, compared to an industry average that is estimated at be closer to a third. The vast majority of users also belong to that asset-poor generation under 40.
As rising property prices keep plenty of Australians out of real estate, more and more might be ready for an alternative.