Transforming Financial Infrastructure: A Conversation with Martin Kassing, the CEO and Founder of Upvest

Upvest, a fintech startup based in Berlin, wants to make investing more accessible and empower the next generation of investors by allowing businesses to offer investments to their customers. Neobanks, asset managers, and traditional banks all make use of their Investment API to give customers instant access to a wide range of investment options, including stocks, ETFs, and crypto assets.

Bessemer Venture Partners led Upvest's €40 million Series B funding in 2022.

We found Martin Kassing, Upvest's founder and CEO about the excursion of beginning Upvest, his vision for Upvest, and the fate of the monetary framework.

 Why did you decide to set up Upvest?

I could see how the financial and technology industries were merging to create new products and business models because I had worked in both. Apps for neo-banks and brokers were expanding in tandem with consumer demand. While user experience (UX) innovation was prolific, these players relied on outdated infrastructure. Upvest took advantage of this opportunity in the market by providing an API that covers all aspects of brokerage, settlement, and custody for all investment products and is easy to use, affordable, and scalable. We are completely committed to fostering a totally new cloud-based speculation foundation, first for crypto and presently for all protections including stocks and ETFs.

What learnings and bits of knowledge did you take from your past encounters at new businesses into establishing Upvest?

Not only can I comprehend markets and business models because of my background in private equity, but I can also locate the appropriate capital structures and appealing opportunities for fundraising. My time as COO of ShopCo, a payment processor that Klarna bought, gave me the operational skills I needed to build great teams, products, and business models from scratch. It instructed me that even incredible items don't need to be extraordinary organizations as well as the other way around. Finding the right product-market fit was the focus of Upvest's early days; more recently, scaling the business with the right people, culture, and capital efficiency has been the focus.

What's your drawn-out vision for Upvest?
With Upvest's Investment-API, any company can provide excellent investment experiences to its customers. Consequently, more individuals approach reasonable speculation items, empowering them to create financial momentum in the long haul. This is absolutely necessary to close the European pension funding gap. With each apu call, we get considerably savvier, more astute and closer to enabling countless individuals with their speculations.

Upvest currently employs over 130 people. Could you please explain how your management style has changed over time as the business has grown?

Numerous iterations and pivots were used in the early days of Upvest to find the right product for the right market. This is necessary an elevated degree of hustling mindset on my side, with a thorough spotlight on long-haul client esteem. We searched for a long time and put in a lot of effort before we found a product that could be funded and had a significant impact on the investment industry. I was deeply involved in every hire and client interaction as well as the product.

When we accomplished item market fit, my emphasis was on building a great business to get a handle available open door. This required me to decide whether I wanted to be hands-on or hands-off. The emphasis has been in recruiting a supervisory group, continually forming our way of life as well as getting first clients and raising capital. My constant goal is to make the company the best it can be while still giving others enough room to shine and develop. Additionally, we now have an excellent management team devoted to our business's operations. Going ahead, I anticipate that culture and capital should be two key regions that will require the greater part of my consideration regarding making a fruitful ground for solid business development.

Can you describe your strategy for securing regulatory approvals? What advice do you have for fintech seeking regulatory approval?

In the fintech sector, numerous predecessors have obtained the required regulatory licenses. As our regulatory authorities, BaFin and the Bundesbank welcome financial innovation. Both parties have always engaged in friendly and constructive dialogue and procedure.

The right people and awareness of compliance within your company are the first steps in preparing for the ever-changing regulatory requirements. Since all of our bank directors are natives, they were already familiar with the business and its culture when they were appointed. This is unusual because the majority of businesses employ an outside senior bank director, which may conflict with your startup culture. My recommendation is to enlist consistency and banking chiefs from the inside if conceivable.

We should look towards what's in store. How do you envision the development of fintech in Europe in the future? and in particular with regard to capital markets and financial infrastructure?

Fintech is the logical outcome of the financial industry's digitalization and will continue to expand rapidly. In the future, there will be a lot of innovation in the consumer and infrastructure industries. This year and next, the current investment crunch will only serve as a temporary boost.

Because it is able to attain the critical mass of consumer fintech companies required to serve more conventional players, infrastructure is likely to experience one of the strongest growth rates in the fintech industry. Quite a while back, there was no choice except to go undertaking first in light of the fact that fintech were excessively few. Because fintechs are looking for new ideas, the new infrastructure will make it possible for traditional players to be more up-to-date, affordable, and scalable as well.

The retail investment market is expanding at a rate of double digits annually with a volume of more than 10 trillion euros, so investment infrastructure will be one of the fastest-growing verticals in the infrastructure space. To remain competitive with fintech, financial institutions must also upgrade their 10- to 20-year-old infrastructure.

How can incumbent banks and fintechs collaborate more effectively in the future?

Occupant banks have consistently worked with programming organizations to empower their business. These product organizations have as of late become known as fintechs. It is normal for banks to re-appropriate many pieces of their worth chain to zero in on their centre business. Cloud computing and blockchain technology will accelerate this trend. Integration, upkeep, and expansion are all made simpler by the new core banking systems that are API-first. An established bank can now select the best API from a vast array of options more easily than ever before.

What is Upvest's next step?
We are excited to announce significant go-lives in the near future with leading global fintechs. Serving and enchanting them will keep us occupied. We are zeroing in on fast development to give them an edge with Upvest. A portfolio engine that enables direct indexing is one exciting new product that is already in the works. We will continue to expand in terms of clients, revenue, and headcount this year. It is an honour for us to develop further towards our main goal, even in these difficult economic situations.