We talked with the CEO of Webull, the stock-trading app on a mission to take Robinhood's users. He said the fintech is 'going product crazy' and revealed plans for a slew of new features.
- Webull, a competitor to Robinhood, is preparing for a string of product launches this year as a volatile stock market draws traders to self-directed tools, chief executive Anthony Denier told Business Insider.
- On top of the brokerage offering, the fintech planned to offer passive investing options, a cash management product, advanced options trading, and crypto products, Denier said.
- Webull, owned by the Hunan, China-based financial data and trading company Hunan Fumi Information Technology, started as a mobile app for market data and analytics, similar to Bloomberg Anywhere.
- "We find we take a lot of users from Robinhood," Denier said, touting Webull as an alternative for traders looking for more sophisticated capabilities.
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A US- and China-based fintech that's pitched itself as the landing spot for Robinhood users looking to up their investing strategies has big product plans this year, as an ultra-volatile stock market has drawn active traders.
Webull, a self-directed trading app that launched its brokerage capabilities two years ago, has a series of releases planned before year-end as the startup looks to establish itself as a competitive player in personal finance.
Anthony Denier, Webull's chief executive, told Business Insider in a recent phone interview that the firm is planning to launch an advisory arm with more passive investing options, a cash-management offering, advanced options-market trading, and cryptocurrency products. The advisory arm would be an automated investment platform with access to human financial advisers.
The fintech, owned by the Hunan, China-based financial data and trading company Hunan Fumi Information Technology (also known as Fumi Technology), is "going product crazy," Denier said.
It's all part of a push to expand what's available to existing customers rather than turn a profit, he said. According to Denier, the startup is profitable, but a company spokesperson declined to provide figures.
"That is not the model, to be adding these premium features to upsell our users. We want to add these premium features to give to our users," Denier, who was an executive with the privately-held financial services firm LXM Group before joining Webull in 2018, added.
"That's been the number one thing we've been saying since we started, to give advanced tools and products that have never been available to the average investor," he said.
SimilarWeb, a web analytics provider, said visits to Webull's website grew to 2.9 million visits in April from an estimated 850,000 in December 2019.
There are signs Webull is "legitimately cultivating and growing a strong user base," Clement Thibault, an industry consultant with SimilarWeb, said.
"Webull's growth mirrors Robinhood's growth since the beginning of the year, as Robinhood's visits grew an estimated 233%. Of course in terms of absolute numbers, Webull pales in comparison to the estimated 32 million visits Robinhood had in April 2020, but that's pretty good company to be in if what you're looking for is strong growth," Thibault added.
In December, Robinhood reported 10 million open accounts. Incumbent investment manager and brokerage Charles Schwab, for its part, last reported 12.9 million active brokerage accounts.
Denier said the first quarter — which included severe market turmoil in March as the coronavirus pandemic spread around the world — was particularly active, with around 350,000 new account openings. Legacy brokerage competitors saw a similar surge, with E-Trade reporting a record 363,000 net new accounts during the same time.
Meanwhile, fintech firms aimed at helping customers get through the market downturns enjoyed significant account growth as well, Business Insider previously reported.
Webull is targeting more mature investors
Webull is hardly alone in its pursuit of creating a one-stop shop for managing money.
In recent years, almost every fintech has gone down a similar path, adding tangential features to a core offering — like self-directed trading, robo-advisers, or a micro-investor — so it can meet all of a customer's financial needs.
With its plans for products like cash management, Webull is prepping to enter a crowded playing field. Self-directed trading and wealth management tools have become ubiquitous, with legacy firms competing for a new crop of tech-savvy investors set to come into a massive inter-generational transfer of wealth.
The wealth-tech market was roughly $1.5 trillion in 2019, according to estimates from the research provider Pitchbook that considers assets under management at both startup and legacy firms' digital wealth managers.
Webull is going after a growing space; Pitchbook analysts expect that market to climb to $6 trillion by 2023.
Part of the differentiation for Webull, Denier said, is its effort to cater to a more mature investor than other fintechs are going for. Internally at the startup, he said there is a saying that Robinhood is a customers' first brokerage account — and Webull is their second.
"There comes a point when a Robinhood user really enjoys investing, really enjoys trading, but finds that there's a lot more tools available on other platforms that are not available on Robinhood," he added. "To take their knowledge and to get more information to that next level, we find we take a lot of users from Robinhood."
Webull's roots and roadmap
It makes sense that Webull, whose average customer is 33 years old and executes five trades a week, would go after more seasoned investors. It's a community Denier said the startup gained a foothold in early on.
Prior to gaining regulatory approval to run a brokerage in January 2018, Webull was purely focused on market data, launching that platform in June 2017.
Denier described the fintech's earlier iteration as an alternative to Bloomberg Anywhere, which allows users to remotely access popular tools on its terminal like data, news, and analytics.
Once that app was downloaded 6 million times, Denier said, the startup considered launching a brokerage.
"They were using our app to actually do their research and check the next good trade and actually execute that trade on a different platform," he added. "We had a nice leg up because we were already on someone's phone."
When Business Insider asked Denier about steering a China-based financial-technology firm through the politically tense few years between the US and China, he said the company could be flexible in response to any regulation regarding investments by China-based companies in the US.
"We can't control what politicians are going to do," he said. "We adjust to any sort of new laws or regulations that come out, because the best we can do is prepare for the worst case."
While Robinhood is Webull's most obvious competitor, Denier said plans for products this year will set the startup on a course to take on different segments across wealth management.
"Who is our direct? Our direct is a little bit of everyone," he said of competition. "We will go after the Robinhood demographic. We will go after the robo-adviser demographic. And we also want to go after the advanced trader demographic."
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