New top investors join Trade Republic in a 1.2 billion euro secondary round. Fintech continues to grow and remains profitable.
Trade Republic is valued at 12.5 billion euros after a secondary transaction. The company announced this this Wednesday. As a result of the sale of existing shares worth 1.2 billion euros, the Berlin neobroker becomes the most valuable German startup. New investors such as Wellington, Fidelity and sovereign wealth fund GIC are taking part, while existing backers are increasing their stakes.
Valuation jump to 12.5 billion euros
With this valuation, Trade Republic is now just ahead of the Munich AI company Helsing, which was recently valued at around twelve billion euros. Compared to the last major financing round in the summer of 2022, when the company raised around five billion euros, the company’s value has more than doubled.
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As part of the secondary transaction, shares from the early phase change hands. Existing investors such as Founders Fund, Sequoia, Accel, TCV and Thrive Capital are expanding their positions. Several long-term investors have been added, including Wellington Management, Fidelity Management & Research Company and Khosla Ventures.
The group of investors was supplemented by the European investment companies Aglaé and Lingotto Innovation. Aglaé belongs to the Arnault family, which is also behind Louis Vuitton. Lingotto is part of the network of the Italian Agnelli dynasty, which, among other things, holds shares in Ferrari.
Trade Republic itself will not receive any new capital as part of the transaction.
Growth without fresh capital
According to its own information, Trade Republic has been profitable for three years and currently sees no need for additional growth capital. The secondary round allows early investors a partial exit and at the same time gives the company more time with a view to a possible IPO. Co-founder Christian Hecker recently emphasized that Trade Republic wanted to continue growing privately for the time being.
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Operationally, the neobroker continues to grow strongly. In the past 18 months, Trade Republic has doubled its number of customers to over ten million, and assets under management are around 150 billion euros. According to the company, around 70 percent of users are investing in the capital market for the first time. Trade Republic has had a full banking license since the end of 2023 and has recently expanded its offering to include checking accounts, a payment card and new asset classes.
Growth also brings friction
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However, rapid growth also brings challenges. Recently, customer complaints to consumer advice centers and the financial regulator BaFin have increased, particularly with regard to customer service. The startup announced that it would continue to expand this in the coming months. Industry observers are currently not expecting any regulatory restrictions, such as those faced by competitor N26 in the past.
