Australian fintech Stake raises a further $50 million as it gears up to launch crypto trading

Australian digital share trading platform Stake has raised a further $50 million via a cash injection from US VC Tiger Global, only months after its $40 million Series A funding round. 

The capital boost, led by Tiger Global and DST Global Partners, takes the total raised in the past year alone to $90 million. 

Stake raised an initial $3.5 million through founder investment and family and friends back in 2019.

Founder and CEO Matt Leibowitz says the fresh injection of funds signaled a “vote of confidence” by its investors, in spite of a tougher-than-expected global trading environment over the past six months.

“This is a vote of confidence from both customers and investors in what we have delivered and what we are building towards,” Leibowitz said. 

This fresh raise follows the fintech’s announcement it would offer crypto trading to its Australian customers by the end of the year. 

Stake was founded in July 2017 by Matt Leibowitz and Dan Silver, who wanted to give Australian retail traders access to NASDAQ-listed companies without brokerage fees. 

The fintech offers $0 brokerage for US stocks, instead cashing in on exchange rates as well as letting investors trade fractions of shares.

The company chased the success of similar platforms in the US such as Robinhood that were set up to service a ballooning retail investing market.

A massive 435,000 Australians joined the share market during COVID-19 for the first time. Data from Commonwealth Bank’s share trading platform CommSec shows (83%) of these first timers were millennials and gen Z investors. 

Stake now has 450,000 customers across Australia, New Zealand, the UK and Brazil, who can access more than 8000 stocks across the US and ASX markets through the platform.

It says it saw its customer base grow by more than 500% in the 12 months before its Series A raise, with Aussies comprising about 75% of its users.

Leibowitz says the funds will propel Stake’s growth as it ramps up the crypto offering and expands its services. 

“The growth in our customer numbers and asset base continue to outpace last year,” he said. 

Tiger Global partner Alex Cook says he was looking forward to supporting the company’s next phase of growth.

“From day one, we’ve been impressed with the team’s focus on better customer outcomes and the innovative ways they connect their customers to the markets,” he said.

Leibowitz says the expansion into cryptocurrency, amid moves including the imminent launch of Australia’s first cryptocurrency-backed exchange traded fund on the ASX, showed the company’s ability to empower Australia’s retail investors. 

An estimated 100 cryptocurrencies will be available via Stake when it goes live in late 2022.

Leibowitz told SmartCompany last year the company was gearing up for global expansion. 

However he says with Aussies making up the vast majority of its users, and with three in four of these people repeat investors, the company was keenly focused on building out its offering as its users gained experience in share trading. 

“It’s about building more sophistication,” along with creating accessibility for new investors. 

“We’ve got exciting plans to give Aussies even more opportunities both in the short- and long-term,” he said.

“We’re building an investing experience for the next generation of investors, and we’re excited to put our time and energy into redefining how Australia invests.”