Canada's Wealthsimple, a fintech that initially started as a commission-free trading platform, now has its sights set on being a one-stop-shop financial service for an ambitious 15 million users. These goals have been announced after experiencing a year of significant growth fueled by the pandemic, which has popularized digital financial services as a whole and increased interest in cryptocurrency trading.
The ambitious company has moved quickly to gain market dominance throughout Canada for an increasing range of services. Last year, Wealthsimple soft-launched its first P2P money transfer app, Wealthsimple Cash which was made available to all Canadians in March. Operating similarly to the features of Venmo and Square’s Cash App, Canadians are finally able to enjoy these features (as neither Venmo or Square are available in Canada). The company also made crypto trading available to users toward the end of last year. Growth for the commission-free retail investment platform has been rapid over the past 14 months with over 2 million users currently enjoying its free app.
Spurring its growth has been a significant recent investment that has seen the company’s valuation exceed $4 billion. The funding round raised C$750 million ($610 million). The round was led by Meritech and Greylock. Other investors include DST Global, Sagard, ICONIQ, Dragoneer, TCV, iNovia, Allianz X, Base 10, and others. Celebrities such as Drake, Michael J. Fox, Ryan Reynolds, Kelly Olynyk, and Patrick Marleau also participated in the round.
It was shared that the funding will be used to increase its current client base. Wealthsimple also intends to meet this bigger client base with a wider and more comprehensive range of services that will earn it its one-stop-shop title. In terms of building out capabilities, Founder and CEO Michael Katchen has shared that he’s been working on cash, checking, insurance, and mortgage products. Currently, the company’s success has come from trading and automated-investing services. The company’s end goal with this financing is to build its way to becoming a users’ primary financial institution.
Should Wealthsimple succeed in its goals, it will become Canada’s largest consumer-facing financial platform. With the buzz of investments in, the company is also surrounded by questions of going public. With that said, Katchen has shared that an IPO will be a path that is arrived at slowly and with much consideration in the distant future.