For nearly 20 years, a prominent CFD broker has focused on establishing itself in the financial markets. Recently, the firm has been working to broaden its image beyond just offering contracts for difference, aiming to attract a wider client base across different financial products.
Despite CFDs accounting for 98% of its revenue, the company is now striving to evolve into an all-encompassing financial super app. Current trends indicate that the retail investor profile has shifted dramatically over the last decade.
Since the beginning of 2023, a range of new product innovations have been rolled out, allowing clients to invest in fractional stocks and ETFs, utilize investment plans, make payments with a multi-currency card, and establish retirement accounts in multiple regions. The company emphasizes that outside of certain jurisdictions, its identity is no longer strictly aligned with CFDs, with 80% of new clients opting for non-CFD products.
In fact, about 80% of new clients are making initial transactions in stocks and ETFs, signifying a notable shift in investment preferences. The fintech has plans for a robust product rollout in 2024, with various updates and enhancements on the horizon.
The company’s headquarters is located in a prominent skyscraper in Warsaw, offering a dynamic environment for its employees. With a significant proportion of its workforce dedicated to technology roles, productivity remains high, even during the holiday season. The leadership aims to clearly define its vision for the future of the platform, which involves continuous innovation and the development of numerous new products.
The company’s roadmap for 2024 includes launching several new offerings and focusing on improving user experience. While financial services will not directly compete with traditional banks, the objective is to emerge as the leading choice for active and passive fund management among European clients.
To support its expansion strategy, ongoing enhancements to the application’s user interface have been implemented, particularly in the UK market. Efforts to adapt to evolving client needs will be accompanied by an emphasis on product diversity and improved overall experience.
The past year has seen a wealth of new product introductions including enhanced investment plans, virtual wallets, multi-currency cards, and retirement accounts in Poland and the UK. Additional products are slated for launch, with marketing initiatives strengthening brand positioning and overall outreach.
The target for 2025 is to finalize more innovative products that will enhance the company’s revenue diversification strategy, moving away from its traditional reliance on CFDs. These new offerings will focus more on profitability, even if they attract a smaller audience than CFD offerings.
During the interview, it was indicated that the decision to postpone the launch of bond products was strategic, based on resource allocation towards higher-impact offerings. Although the landscape for some products like bonds may evolve, groundwork has been laid for future introductions.
As the UK market sees a growing emphasis in product marketing, as well as plans to solidify brand presence, there is a clear ambition to increase customer acquisition. Marketing expenditures are set to rise in established markets as well as regions where growth has previously been limited.
Competitive analysis includes shifts in focus away from traditional CFD competitors, looking more towards emerging players that may have gained traction in key markets such as the UK.
While CFDs have historically comprised the bulk of revenue, the company is gradually working to alter this perception and is actively pursuing a future where a larger share of revenue derives from non-CFD products. Growth in client onboarding is crucial, and with trends indicating a fresh interest in stocks and ETFs, profitability from lower-margin offerings is expected.
In Poland, the introduction of retirement accounts (IKE) was met with enthusiasm, and recent developments now allow for account transfers, suggesting a significant uptick in interest moving forward. The creation of additional retirement account solutions is also in the works.
Plans to introduce a pan-European personal pension product suggest a commitment to expanding the scope of available financial products.
The shift in client preferences toward less complex investment products reflects broader market dynamics. Clients opting for simpler solutions, like ETFs, indicate a departure from more intense CFD trading activities. This change underscores an evolving interaction with investing landscapes and technologies.
In terms of key performance indicators, while profitability remains important, the focus on client acquisition and engagement is paramount. Sustained client growth is expected to pave the way for long-term profitability.
Investments in technology have positioned the firm for future flexibility and control, with AI already being woven into many operational elements. Continued development will ensure that internal processes scale efficiently and support investor needs, heralding a forward-thinking approach to enhancing the overall client experience.