Ann: Quarterly Activities Report and Appendix 4C, page-34

For examples sake: if Selfwealth dropped their brokerage from $9.50 to $3.

Trades are something like 1.6m per year.
So an immediate hit to revenue of $10.4m PA, or hit to cashflow of $2.6m per quarter.
It would require an additional $350m client cash brought in to offset that revenue loss. (vs $638m lately) The move would attract additional portfolios, but more-so 'budget' portfolios, so may not bring in that much client cash, and would create cashflow issues in the interim - SWF's cash would be burned before long, more likely to require a raising.

It would mean a greater growth rate and market share, but very costly.

You can imagine that Stake would be burning cash like this. Actually, even more since their promotion is something like free trades for a year after transferring a portfolio in.

Stake's app ranking - #94 in finance in AU.
Selfwealth's app ranking - #207 in finance in AU.

So Stake has more usage, but more-so low portfolio size types. So not apples-to-apples.

Although according to Selfwealth, they just reached #3 by market share and only 1% behind #2. I don't know how Stake figures into that. Maybe Stake has mostly usage for US, so doesn't place top-3 for ASX.


"Australian digital share trading platform Stake has raised a further $50 million via a cash injection from US VC Tiger Global, only months after its $40 million Series A funding round. The capital boost, led by Tiger Global and DST Global Partners, takes the total raised in the past year alone to $90 million."

Stake is sitting on $90m cash, minus whatever they've burned.

It's a lot relative to SWF's $10m. (and <$1m cash burn last quarter)

But who knows if Stake is on the right track. They're gaining users, sure, by giving out free/cheap trades, but is it sustainable?

Selfwealth - 74 employees listed in Linkedin. $3m staff costs last quarter.
Stake - 131 employees in Linkedin. Maybe $5.3m staff costs per quarter.

Selfwealth makes a gross profit on trades, and -12% cashflow margin (last quarter) after all expenses (because of marketing #1, staff #2).

Stake probably make a gross loss on trades! (because of the free trades, and $3 when not free) Which makes it near impossible to make an overall profit. But they'd be writing off that loss as a marketing cost (the free trades). So they lose money on the trades, make some back from interest, then lose more from staff etc. At some point they probably have to change their plan - to make more revenue.

If we're lucky, Stake's promotion drives Superhero or Pearler bankrupt, then Stake's funders decide that it's unsustainable and stop giving them cash.