Lightyear, to infinity and beyond

Lightspeed is excited to announce our Series A investment in Lightyear, Europe’s first truly commission-free and most competitively-priced investment platform, founded by two early Wise executives. When we first met Martin Sokk and Mihkel Aamer, it was clear that they are exceptional product thinkers and executors — something we always look for — and have a true founder-product fit here.

Make investing Lightyears better

Since launching, Lightyear has built one of the most intuitive, aesthetic and speedy stock trading apps to invest globally, without unnecessary barriers or fees. It is one of the most transparent and cost-effective platforms to invest in overseas equities. Depending on portfolio size and frequency of trades, consumers can save north of £1k versus existing solutions. Core to this is the multi-currency ledger, enabling users to hold USD, EUR and GBP accounts in-app. Lightyear brings the Wise mindset to stock trading.

Beyond infrastructure, Lightyear is committed to educating investors through a simple-to-use interface and analytics. Users can access analyst ratings, price targets, short market updates and more. Lightyear Profiles enables users to share portfolio holdings, watchlists and recent buys and sells with friends. The team is focused on opening up the market — a third of their users are trading stocks for the first time.

The vision is to offer radically better ways to invest and manage your finances, including addressing local needs across the European market as well as expanding beyond equities. European securities and tax-free ISAs in the UK are among the most requested products.

Investing in Europe is still broken

The current retail investment platform offerings are non-linear across Europe. That fragmentation is the result of different regulations, languages, exchanges and cultural investing norms. There is no single neobroker offering products across the continent, and Lightyear wants to fill that void with a frictionless offering that consumers trust and love.

When comparing market participation in Europe to North America there is a galaxy-sized difference in the percentage of household wealth invested in stock and funds. In Europe, that figure has remained mostly stable at ~25% post financial crisis versus ~55% in North America. That delta exists in large part due to infrastructure — access to markets — and fee structures.

There are indications the tide is turning. Record trading volumes in 2021 spurred a new wave of consumers onto retail investment platforms in Europe, with retail share of volume on Euronext twice normal levels versus the year prior. Customer-friendly regulations such as RDR and MiFID are encouraging a new generation of investors. More 401k and ISA-style tax-advantaged initiatives will help.

The addressable market is huge: investment funds and listed shares held by European households exceed $4,700B. In the UK alone, the D2C financial wealth market is ~£300Bn, with structural growth drivers such as life expectancy and low asset yields expanding the opportunity. Mobile-app participation remains low. In the UK only ~12% of adults utilize at least one funding or investment app, whereas more than 73% regularly bank online. Millennials and Gen Z will bring that figure higher as their share of national wealth increases.

Intergalactic team

Martin Sokk and Mihkel Aamer were previously Head of Product and Engineering Lead at Wise, and have assembled a team from Wise, Revolut, Robinhood UK and Pipedrive. We look forward to joining Lightyear as they expand across Europe — the first neobroker to unlock most of the continent in one move — and beyond.

Written with Nicole Quinn and Paul Murphy, originally published on the Lightspeed blog.