Lightspeed is excited to announce our Series A investment in Lightyear, Europe’s first truly commission-free and most competitively-priced investment platform founded by two early Wise execs. When we first met Martin Sokk and Mihkel Aamer, it was clear that they are exceptional product thinkers and executors (something we always look for at Lightspeed) and have a true founder product fit here.
Make investing Lightyears better
Since launching 9 months ago, Lightyear has built one of the most intuitive, aesthetic and speedy stock trading apps to invest globally, without unnecessary barriers or fees. It is one of the most transparent and cost-effective platforms to invest in overseas stock equities. Depending on portfolio size and frequency of trades consumers can save north of £1k vs. existing solutions. Core to this is the multi-currency ledger, enabling users to hold USD, EUR and GBP accounts in-app. Lightyear brings the Wise mindset to stock trading.
Beyond infrastructure, Lightyear is committed to educating investors through a simple-to-use interface and analytics. Users can access analyst ratings, price targets, short market updates and more. Another feature called “Lightyear Profiles” recently launched, which enables users to share their portfolio holdings, watchlist and recent buy/sells with friends. The team is focused on opening up the market, as seen by the fact that a third of their users are trading stocks for the first time.
The company has an exciting roadmap ahead of it, including addressing local needs across the European market as well as expanding beyond equities. European securities and tax-free ISAs in the UK are their most requested products. The vision is to offer radically better ways to invest and manage your finances.
Investing in Europe is still broken
The current retail investment platform offerings are non-linear across Europe. That fragmentation is the result of different regulations, languages, exchanges and cultural investing norms. There is no single neobroker offering products across the continent and Lightyear wants to fill that void with a frictionless offering that consumers trust and love.
When comparing market participation In Europe to North America there is a galaxy-sized difference in percentage of household wealth invested in stock and funds. In Europe, that figure has remained mostly stable at ~25% post financial crisis vs. ~55% in North America. That delta exists in large part to infrastructure — such as access to markets — and fee structures.
However, there are indications that the tide is turning in market participation in Europe. Record trading volumes in 2021 spurred a new wave of consumers into retail investment platforms in Europe, with retail share of volume on the Euronext exchange twice normal levels when compared to 12 months prior. Furthermore, customer friendly regulations such as RDR and MiFID, are also encouraging a new generation of investors. More 401k and ISA-style tax-advantaged initiatives will help.
Why does this matter? The addressable market in Europe is huge, with investment funds and listed shares held by European households exceeding $4,700B. In the UK alone, D2C financial wealth market is ~£300Bn and structural growth drivers such as life expectancy and low asset yields are driving further opportunity expansion. Moreover, mobile-app participation remains low. In the UK only ~12% of adults utilize at least one funding or investment app whereas >73% regularly bank online. Millennials and Gen Z will bring that figure higher in the next decade as their share of national wealth increases.
Intergalactic team
Martin Sokk and Mihkel Aamer were previously the Head of Product and Engineering Lead at Wise (formerly known as TransferWise) and have assembled an all-star team from other unicorns including Wise, Revolut, Robinhood UK and Pipedrive for the mission. Lightyear’s Head of Product, Nishil Parekh, previously led the wealth, stock-trading, crypto and commodities products at Revolut and Wander Rutger, former President of Robinhood International, joined Lightyear as Chief Operating Officer. This is a team ready for liftoff.
Lightyear joins Lightspeed’s already stellar list of 20+ portfolio companies based in Europe, which includes Personio ($8.5B valuation), Blockchain ($5.2B), Vinted ($4.5B) and Grafana Labs ($3B). Across Fintech, we have been fortunate to back the teams at Affirm, Alchemy, Alloy, Carta, Finix, FTX, Lemon Markets, Payhawk and more.
We look forward to joining Lightyear as they expand across Europe into 20 new countries — the first neobroker to unlock most of Europe in one move — and beyond.
For a representative view on how much you’d save by using Lightyear, check out the great tool on their homepage!
Written by Adrian Radu, Nicole Quinn and Paul Murphy
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