- Point72 Ventures and three other investors have poured $US21 million into fintech firm DriveWealth.
- DriveWealth chief executive Robert Cortright told Business Insider his firm’s tech is helping move the cost of stock trading to zero.
DriveWealth, a company building technology to bring the cost of investing to zero, has landed $US21 million in an investment round led by four investors including the venture unit of Steve Cohen’s Point72.
The New Jersey-based company announced Tuesday the Series B fundraise led by Point72 Ventures, SBI Group, Raptor Group, and Route 66 Ventures, a previous investor in the company.
DriveWeath’s technology, which provides its clients access to stock markets, works in the background of a number of investment services. Its clients include MoneyLion, a lending and wealth management app, and INVSTR, a UK-based stock trading application.
In an interview with Business Insider, DriveWealth chief executive officer Robert Cortright said the new money will help the company enhance its products, including a new one that enables its customers to provide real-time rebalancing for portfolios.
“DriveWealth has built a world class tech-driven brokerage stack that allows fintech firms to incorporate a range of investment capabilities into their product offerings,” Pete Casella, head of fintech investments at Point72 Ventures, said.
Point72 Ventures, which is funded exclusively by Cohen, focuses its investments in the financial technology and artificial intelligence space, according to its website.
In September, Point72 Ventures led a $US4.1 million seed investment in AlphaFlow, a technology firm in real estate, Bloomberg News reported. It has also invested in Acorns, the fintech app that lets users invest their spare change, and Quantopian, a crowdfunded hedge fund.
Cliff Friedman, managing director of Raptor Group, said “We are pleased to partner with DriveWealth’s experienced management team to support the Company’s growth, as it develops its innovative technologies and scales its business focused on the next generation of investors in markets worldwide.”
By allowing more firms to more easily tap into equity markets, Cortright says DriveWealth has played a role in the compression of stock trading fees. He predicts brokerage fees will go to zero. Free trading propelled Robinhood, a popular investing app among millennials, to a $US5.6 billion valuation.
“We are moving away from these commission-based systems,” Cortright said. “We are powering a number of services that are facilitating that shift.”
Business Insider Emails & Alerts
Site highlights each day to your inbox.