When Seth Invest launched in 2019, it aimed to create a community where women who wanted to invest in the stock market, but weren’t sure where to start, could gain the knowledge and confidence to jump in. Now the users can do it all in Seth Invest platform.
The Copenhagen-based startup announced this week that it has acquired Danish fintech Gaia Investments. The purchase price of Gaia was not disclosed, but the startup paid $3 million, three months before the transaction, Seth Invest told TechCrunch.
For Seth Invest co-founder and partner Camilla Falkenberg, adding the ability to invest directly through Seth Invest is a great next step for the subscription edtech platform.
“From day one, we’ve always focused on building features and products that our community has asked for,” Falkenberg said. “We ask questions every day about the opportunity to trade directly with us.”
She added that she thinks the platform gets that request so often because its users trust it. A recent customer survey found that 96% of them trust a woman to invest their money more than a bank.
Seth Invest has spent the last year building the company in a way that makes it easy to integrate businesses. Since raising $4.5 million in seed funding last November, Falkenberg has built an app, expanded its tech team, and raised an additional $3 million in funding.
But when they came across Gaia Investments in July, Seth Invest realized it made more sense and time to partner with an existing trading platform as opposed to building their own.
“Gaia has a strong brand here in the Nordics and places great emphasis on ethical and sustainable investment, which is something we are looking for,” she said. “As the talks progressed, it became more and more clear that it was a big step for us.
The team at Gaia felt the same, Mads Sverre Willumsen, co-founder and CTO told TechCrunch.
“We know Seth Invest and we’ve seen their journey over the last three years,” he said. “After we talked and saw that we had a line-up, the decision wasn’t that hard.”
The two companies shared similar founding stories – they both wanted to create an investment product that they both felt needed and didn’t have.
For Female Invest, it was 2019 when the founders realized that there was no good resource to teach women how to start investing. When LeGaia, co-founder and CEO David Bentzon-Ehlers mom asked him if there was a safe place to invest in sustainable companies in 2020, he realized the platform he was looking for didn’t exist yet.
While it’s not uncommon for startups to be early in life — Gaia just completed the Techstars accelerator program a few months ago — Sver Willumsen said the transaction made sense for Gaia because they were more interested in expanding their reach than becoming product startup innovators.
“I didn’t become a founder in the first place to be a founder,” he said. “I did it because there was a lot of innovation and an opportunity to make a difference to people very quickly.”
Existing Gaia users will be downgraded – their money back in full – in the near future as the platform begins to invest in women. Falkenberg said they don’t yet have a specific launch date for female investors there, but the trading capability will launch first in the EU and then in the UK.
Consolidating early-stage startups is a growing trend this year, and as the fintech sector struggles with uncertainty in 2022, it would seem wise for some of these smaller companies to join forces so they don’t get left behind. I’m sure we’ll start to see more of this next year.
Investing for a woman though, long-term planning, regardless of market conditions, is all falling into place.
“Our vision is to create an extremely user-friendly and easy-to-navigate platform with a focus on sustainability to invest in the values that matter to them,” Falkenberg said. “We have a very loyal user base waiting to launch the next product, which is a great starting point.”