Whilst the investment sector had definitely grown in recent years, experts believe it still isn’t solving the fundamental problems, including high fees, hidden costs and the complicated nature of the products.
Founded by an ex-TransferWise duo with a team of former Revolut, Robinhood & Pipedrive employees — London and Tallinn-based fintech Lightyear is a new investment platform for Europe boasting itself as commission-free platform, backed by some big names in the fintech industry.
$1.5M seed funding
The British startup has just announced a $1.5M pre-seed funding round, where the investment was led by Taavet Hinrikus, co-founder of Wise and Sten Tamkivi, co-founder of Teleport as the first portfolio investment of their recently formalised partnership to invest in early-stage European businesses, alongside another lead investor Jaan Tallinn (Metaplanet), the co-founder of Skype. The round also welcomed a cohort of prominent angel investors and industry experts including Ott Kaukver, the CTO at checkout.com, Wander Rutgers, the former President of Robinhood UK and Kaarel Kotkas, the founder of Veriff.
Founded in the summer of 2020 and set to start rolling out in Q3 2021, Lightyear marries multi-currency accounts with unlimited access to global markets so customers can invest freely without hidden fees or charges.
With the latest investments, the company is looking to hire a few key roles into both the London and the Tallinn office as they gear up to launching the product later this year. Currently, they have a team of 10, and they aim to triple the headcount. “We’re looking for people across a range of departments like Engineering, Growth & Design,” adds Mihkel Aamer, Co-Founder and CTO at Lightyear.
No FX fees
Once launched to the UK customers, Lightyear aims to focus on growing in the UK market and expand services across Europe.
When looking at the UK fintech market, investment platforms include Hargreaves Lansdown and traditional banks alongside neo-brokers like Freetrade. Further, there are more players in the segment like Germany’s Trade Republic and the Netherland’s BUX. With competitors across Europe charging retail investors a range of FX fees, custody fees and trading fees, upon launch Lightyear claims to be one of the most cost-effective ways to invest.
Lightyear’s MVP product will be launching with unlimited access to over 1,500 global stocks and ETFs. Lightyear claims to have no trading fees, no account fees and no FX fees up to £3,000 per month. After customers exceed that, there will be a 0.35% FX fee.
Meanwhile, Lightyear today has also launched its waiting list, inviting people to sign up and register their interest in getting early access to the app when it launches later this year. Upon launch, the first 2,000 customers will receive £10 to invest in a stock of their choice, and all waitlisters will get a spot in the beta testing community for future product launches.
“For people with less first-hand knowledge, or without the time to self-teach, it’s a good enough service. It has essentially created an inequality where if you have either specialist knowledge or more money, you get access to a better service than those that don’t,” Martin Sokk, Co-Founder and CEO at Lightyear tells UKTN.
Taavet Hinrikus, co-founder of Wise and investor also was quoted in the press release saying: “Most things in our lives are available at the tap of a button or with a good internet connection, yet access to global financial markets is still murky and expensive. The potential here to open up investing for everyone, much further than just their local markets, is very exciting. Giving everybody access to the best deal when it comes to their money is in my DNA, so I’m excited to support Lightyear on this mission.”