Customers can trade securities for free with Gratisbroker. In our Seven Questions, the founders explain how their company still manages to earn money.
Munich Startup: Who are you and what do you do? Please briefly introduce yourselves and your service!
Gratisbroker: All three founders come from the banking industry and worked together at the former DAB Bank — Malte worked in product management in trading and Stefan and Philipp worked in IT. We’re all in our mid-forties, which means we have quite a few years of experience under our belts. That means we aren’t your typical startup founders, but we are just as motivated: We want to really shake up the German brokerage market and take it to a new level with trading opportunities that are entirely free of charge.
We’re familiar with both sides of the trading business, because in addition to our professional backgrounds, we’re also active off-duty traders. As a result, we know exactly what is necessary to be profitable in the field without limiting our customers too much. Our concept is easy to explain: We offer securities trading that is always free, but that’s also all we offer: free trading. You have to get your market information and hot tips somewhere else. We also don’t offer any other banking products, such as a checking account. By reducing costly additional offers, completely automating all processes and using new IT technologies, the payment we receive from our trading partners for providing order flow, which all brokers receive by the way, is enough for us.
No fees, but there is a minimum order size
Munich Startup: But that’s nothing out of the box!
Gratisbroker: It really
doesn’t exist yet. Ever since online banking was introduced in the 90s, the
discount brokers from back then, the business model for securities trading
hasn’t evolved in any substantial way. Despite intense competition, there’s
been a relatively stable price policy since then. That changed abruptly this
year. The app Trade Republic started before we did but it addresses a different
target group than we do and also isn’t completely free. They offer trading for
a third-party flat rate of one euro per order. We make it possible to trade
securities entirely free of charge all of the time — the only requirement is a
minimum order size of 500 euros when making a purchase.
Munich Startup: What are the three main ingredients in your recipe for success?
Gratisbroker: We feel we’re united by a strong fighting spirit to win people over, but we’re realistic at the same time — which is the result of long-term experience in the business. A good network is also important and perhaps the most important aspect when starting a company.
Gratisbroker is new in the market
Munich Startup: Now let’s get down to the nitty-gritty: How is business going?
Gratisbroker: We just went live at the beginning of November after starting the beta phase in September and October. Since then, we’ve won over several hundred customers with our offer without the need for a large marketing budget. We’re pleased about the positive response and are very happy so far.
Munich Startup: What does Munich mean to you?
Gratisbroker: We all moved here, but it’s also become our home. The prices in the city, regardless of whether for offices or salaries, certainly don’t provide tailwind for founders, but anyone who still manages to found a fintech this far away from the finance capital Frankfurt can really only win.
Munich Startup: How will your startup become the next unicorn? Or will we be seeing you at an Epic Fail Night soon?
Gratisbroker: We haven’t even had time to celebrate our success so far, so you definitely won’t be seeing us at a Fail Night.
Becoming a unicorn isn’t our goal, but rather to grow quickly and organically. And that will make us profitable faster than all our competition so we can conquer our piece of the brokering market pie.
Munich Startup: Hiking or beer garden?
Gratisbroker: Hiking around the beer garden.