In the midst of ongoing market fluctuations, the U.S. stock market continues to attract global investors due to its vast size and liquidity. However, trading on U.S. exchanges remains a challenge for many international investors. A startup based in San Mateo has identified this gap and is addressing it by providing an API that enables financial services firms to offer trading solutions to their customers.
This innovative company claims to support over 5 million brokerage accounts and has established partnerships with more than 200 financial institutions across 40 countries. To further capitalize on this momentum, the startup announced a successful $52 million Series C funding round aimed at expanding its reach into new international markets, including regions in the Middle East, Europe, and Asia.
The funding round attracted both new and existing investors, including notable firms such as Derayah Financial, 850 Management, National Investments Company Kuwait, Unbound, and Portage Ventures.
Recently, the startup opened a new office in New York City and plans to utilize the newly acquired funds to secure additional regulatory licenses in various regions, similar to those it currently holds in the U.S., Japan, and the Bahamas, as shared by co-founder and CEO Yoshi Yokokawa.
Yokokawa emphasized the significance of this funding, stating, “This investment is crucial for us as it acts as a catalyst for our global infrastructure, transitioning from a U.S.-centric platform to a more internationally focused one.”
In addition to expanding its geographical footprint, the company intends to use the funds to develop new products, incorporate non-U.S. offerings such as European and Asian equities, and enhance its trading capabilities to support 24/5 trading of U.S. stocks.
This Series C funding round brings the total amount raised by the company to $170 million.
Founded by Yokokawa, a former investment banker with experience in both the U.S. and Japan, along with Hitoshi Harada (CPO), the startup initially focused on providing software solutions that financial services firms and fintech companies could leverage to facilitate trading for their clients.
Yokokawa explained, “Our initial goal was to create a globally functional infrastructure in 2018 that would allow individuals outside the U.S. to establish platforms akin to Robinhood or Wealthfront while adhering to their local regulations and contexts. However, ensuring compliance and regulatory accuracy in the U.S. is a complex task that we manage effectively, as access to U.S. products is essential for global investors.”
Since its inception, the company has broadened its offerings to include a variety of financial products such as stocks, ETFs, options, fixed income, and high-yield products in USD for IRA accounts. Recently, it also partnered with a prominent cryptocurrency exchange to enable its users to trade U.S. stocks and ETFs in select states.
The Series C funding comes approximately 18 months after the company secured a Series B extension. Since that time, Yokokawa reported that the startup’s revenue and assets under custody have tripled, while its trading volume has quadrupled. The company has also achieved the status of a fully self-clearing broker-dealer with DTCC membership, allowing it to manage all trade clearing and settlement processes internally, including risk management and compliance.
Yokokawa identifies a well-known brokerage firm as a key competitor, particularly in terms of its international presence and technological capabilities. However, he believes that the primary distinction lies in the fact that the competitor was established in 1978, resulting in technology that is based on legacy systems.
He noted, “When new banks seek to enhance their offerings for customers, they prefer to collaborate with modern partners who can provide contemporary solutions. This is how we are gaining market share and growing at a faster pace, although I do recognize them as our competition.”
Currently, the startup employs around 200 individuals, with the majority working remotely from various locations around the globe.