As decentralisation becomes the norm, whether that be the proliferation of blockchain technologies or simply corporates taking ‘customer listening’ ever more into consideration when making big decisions, it’s no surprise that the finance industry and the way people invest is moving in this direction too.
From removing barriers to entry, to facilitating education on the world’s stock exchanges, investing is becoming a more accessible and community-driven activity.
Stephanie Brennan founded fintech startup Evarvest in 2018 to help change the way the world invests, making it as simple and understandable as having a smartphone and a good WiFi connection. Connecting the world’s stock exchanges, in one simple app, she has built a platform that helps people invest in, and have a say on, the brands they know and support.
We sat with Stephanie to get her insights on the changing landscape of investment, her top tips for crowdfunding and her experience of founding a company in the rising fintech hub of Vilnius, Lithuania.
Hi Stephanie, thanks for joining us! Could you tell us the story of Evarvest, and your mission?
The idea for Evarvest’s stock trading app was born out of the desire to change the outdated and complex financial system worldwide, while also helping others to start investing. While living in three different countries – Australia, the UK and now Lithuania – I’ve noticed that the finance industry can’t keep up with the next generation of investors the way that tech companies like Facebook or Uber – both in terms of convenience and cost-efficiency. Today, people need easy, quick and inexpensive investment solutions, which aren’t restricted by any barriers.
This is exactly what Evarvest is offering. Our mission is to make investing as simple as having a smartphone and a good WiFi connection – the way it should be! The Evarvest app will be the first ‘Spotify-style’ trading app directed to the next generation of investors. It will offer a number of international trade capabilities combined with banking level security and low commission rates. Our users will also have access to the built-in news feed section and dedicated Educational Library, a free educational resource created by us in order to promote financial literacy and provide a wide range of useful, and more importantly, practical insights into investing and finance management.
What differentiates Evarvest from its competitors?
There are four main features differentiating our application from the solutions provided by our competitors. The first is access to over 30 stock markets across the world. At Evarvest we believe that people deserve to choose the markets and companies they want to invest in. There are a lot of world famous brands listed in the USA, like Nike or Apple, but, there are also brands that we know and love in our home towns too. Investors should be able to access foreign and domestic opportunities affordably, from the one app.
The second thing distinguishing us from our competitors is the user experience of Evarvest’s application. Unlike the majority of traditional trading apps, our Spotify-style trading solution has a functional and user-friendly interface, easy picking stock playlists and a number of elements for community engagement enhancing the social aspect of investing. Our users will be able to create and share their own portfolios as well as follow the portfolios of their friends and Evarvest’s top performing investors, like they follow an artist on Spotify or their friends on Instagram.
The third feature of our Evarvest app is our strong focus on education. Believing that the first step to building wealth is knowing how to, and we want to support wise investment decisions by promoting financial literacy. That is why we created our Educational Library.
Last but not least, we’re also gaining the applicable licenses in different jurisdictions so we can make our Evarvest app accessible to investors across the globe.
How do you see the future development of fast and accessible investment technologies for the masses?
With significant investments into this space and dynamically developing technological solutions, fintech companies are strengthening their role and shifting from disruptors to industry leaders. Month by month fintech solutions will play a more significant role, setting the trends and shaping the future of the financial services sector.
Previously the fintech sector was aligned with a local ambition, meaning fintech startups were first focused on developing their position in one country or one region, before eventually expanding to other locations. With efficient RegTech solutions facilitating the use of new technologies to comply with regulatory requirements, we are about to observe a new generation of fintechs that are going global from day one. The use of the latest technologies, including Cloud Services and Artificial Intelligence (AI) makes fintech companies more agile and faster in implementing the required compliance, market localisation and customer support to scale internationally.
So, with increased competition, price becomes a defining factor in a consumers decision making process. With increasing consumer awareness regarding costs and cost-efficiency, the finance industry has recently realised that to compete and meet clients’ needs, they need to change the way they monetise by cutting consumer facing prices. This shift in consumer facing pricing has already begun.
An industry going to zero on price is a recent phenomenon in the fintech space, especially among large US brokerage firms. In November 2019 Charles Schwab, the largest publicly traded e-brokerage firm, announced that it would cut trading commissions to zero. More recently, Vanguard, J.P. Morgan and Interactive Brokers have also announced their own free trade options. When an industry goes to zero on price, the competition between brokerage firms will no longer be on price but on value – a great step in the right direction for an industry that’s needed changing for a long time! Value, accessibility and awareness will be the three defining metrics for the future success of fintechs.
Evarvest previously ran a crowdfunding campaign, why did you decide for this route over traditional VC funding?
Real change comes about when a community of people are driving that change. This is why we focused on crowdfunding for our first investment round, rather than VC funding; to tap into and engage with a network of people that believe in and/or have experienced the pain point we set out to solve. Capital aside, the support, waitlist growth on our product, knowledge and network that has come from our shareholders, is far more than we anticipated and speaks volumes to the added value of raising capital through a platform like Seedrs.
What are your top tips for founders launching a crowdfunding?
Crowdfunding has a lot of benefits and it’s a great way to validate your idea, gain feedback, expand your networks and knowledge – particularly from investors in other markets you may want to expand into, so be prepared and transparent. This is people’s hard earned money they’re using to support your mission – understand that, respect it and encourage their feedback. I’d also be prepared for closing your round to take longer than expected – this was our experience – so it’s important to know how to manage your runway between fundraising rounds.
As a female-led team, what advice do you have for female founders?
My advice for female founders, is largely the same advice for any founder. Solve a meaningful problem, understand your customers and understand where you’re leading your company – these elements will define the decisions you make. All founders share similar challenges, and these challenges evolve as you become more successful, so having a great team and great advisers around you can support you to make wiser decisions, in the same way listening to your customers can.
Lithuania and its capital Vilnius are fast becoming well-known hubs for fintech. How is it setting up a tech company there and what do you think makes it unique?
That’s true, Lithuania has recently become one of the most popular fintech destinations worldwide. There is talk that it will soon replace the UK as a post-Brexit fintech mecca. Only recently the Global Fintech Index placed it at the 4th place in Fintech’s top 10 list.
After having lived here for nearly two years, I’ve noted that Lithuanian government bodies have been progressive in creating a fintech-friendly environment, and welcoming foreigners into it. Over the past years, this small European country, who most people have probably known only for its world-class basketball team, has passed several important regulations supporting the development of fintech companies and facilitating their further operation.
This includes, for example, a regulatory sandbox allowing to test fintech solutions in a supervised environment before their market introduction, as well as the Bank’s of Lithuania newcomer programme, which helps potential financial market participants evaluate their opportunities in Lithuania and gives them an insight on legislative and licensing requirements.
From my personal experience, I’ve found the Lithuanian regulators and government bodies to be accessible, particularly as a foreigner. We’ve been able to meet with them to understand their expectations but also to gain some insight into their supervision and oversight. Coming from Australia, it’s really important we understand the different regulations, as Europe is a completely new and very different market for us, but also to understand how EU regulation is implemented in different European countries.
Last but not least, Lithuania has the fastest licensing process in Europe, taking a maximum of six months with an average of three, whereas the same process in the UK or Australia can take up to twelve months or more. And since Lithuania is part of the EU, the license granted by the Bank of Lithuania, carries passporting rights, meaning we’re able to use it to expand into other countries within the EU.
What is your long term vision for Evarvest?
Right now we are focused on our upcoming launch, once our license is granted. Later this year, we plan to continue our global expansion and increase our Educational Library. The next phase of our development is to expand our product portfolio into further financial products, to support investors wealth creation and retirement portfolios. This aligns with our long term vision to increase financial literacy by removing barriers to entry and making investing and investment education accessible to the world.
What has been one of your biggest failures, and what did you learn from the experience?
I’m not sure if other people would see it as a failure, but for me it was, although at the end of the day, it turned out to be a really valuable experience. In one of my last businesses I brought on a business partner and it really showed me that sometimes visions don’t align which can negatively impact both day-to-day operations and the direction of the business as a whole. So, with Evarvest we’re really focused on working with people that have the same vision to make investment education and investing, more broadly, accessible – this alignment on vision has a ripple effect throughout the company, what features we develop, how we price our product and so on. So, regardless of the position held within Evarvest, we’re all working towards the same outcome.