(Bloomberg) -- Commission-free investing platform Public.com is launching in the UK, marking the Robinhood rival’s first expansion outside its American home market.
The New York-headquartered firm will allow British retail investors to trade more than 5,000 US stocks and access additional services such as data and research from Thursday, Leif Abraham, co-CEO and co-founder of Public, said in an interview. The company, which also offers investing in US Treasuries, exchange-traded funds, crypto and alternative assets in the US, plans to eventually expand the products it offers in the UK and move into other European countries, Abraham said.
“The goal is to have the same product experience in all markets,” Abraham said. “We are big believers in being a multi-asset investment platform.”
The UK market has traditionally been tough to crack for US stock-trading apps. Robinhood itself attempted several unsuccessful launches in the country since 2019, most recently via the now-scrapped acquisition of London-based crypto trading firm Ziglu. Instead, competition largely comes from UK-native businesses like Freetrade, Lightyear and Revolut.
Read more: UK Warns Trading Apps to Review ‘Game-Like’ Design Features
Unlike sector-pioneer Robinhood, Public does not make money through payment for order flow, a controversial practice where market makers pay brokerages to route orders through them, rather than directly to stock exchanges. Favored by zero-commission trading apps, the practice was banned in the UK in 2012.
Instead, Public says it earns revenue through services like its premium accounts and a voluntary tipping system. Once it’s live in the UK, the company will charge FX fees for converting British pounds to the US dollars needed to purchase US stocks.
A retail-trading boom in companies that were popular on social media during the coronavirus pandemic, known as the meme stock craze, led to several trading outfits becoming venture capital targets. Among them was Public, which raised $220 million in 2021 from investors including Accel, Greycroft, Lakestar and Tiger Global at a $1.2 billion valuation.
But enthusiasm among retail investors for equities trading has been more muted in the months since, while venture capital investment in financial technology startups has dried up. While Public is not yet profitable, it continues to grow and has a “healthy cash balance at the bank,” Abraham said.
“The funding markets have changed but this year has been the best year to date for us ever,” Abraham said, without disclosing exact figures. “The first two quarters were the best in the history of the company.”
The firm, which also has offices in Copenhagen, London and Amsterdam, looked at several alternatives when deciding where to kick off its international expansion. It ultimately opted for the UK as a result of the market’s size and the fact that it already has an English-speaking product, according to Abraham.
“The UK population remains very savvy, very open and accepting towards digital financial products whether it’s a lending app, banking or investing,” Dann Bibas, Public.com’s general manager for international and former head of investments at UK fintech giant Wise, said in an interview.
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