BlackRock (NYSE:BLK) has entered into a strategic partnership with Berlin-based fintech firm Upvest, aiming to democratize investing for millions across Europe. Announced on Wednesday, the collaboration brings together BlackRock's extensive expertise in ETFs and asset management and Upvest's cutting-edge investment API, with the goal of creating innovative investment experiences.
As part of this collaboration, BlackRock participated in Upvest's €30 million funding round. Other investors included Bessemer Venture Partners, HV Capital, Earlybird, Notion Capital, ABN Amro Ventures, and 10x Capital. The partnership aims to capitalize on the growing retail investment market in Europe, where the number of ETF savings plans is expected to increase from 4.9 million in 2021 to approximately 20 million by 2026.
Upvest's portfolio engine and re-balancing features, both regulated by the German supervision authority (BaFin), along with innovations such as fractional dealing of ETFs and stocks, are seen as potential benefits for neo brokers and neo banks. Timo Toenges from BlackRock's iShares EMEA Digital Wealth business and Martin Kassing, Co-founder and CEO at Upvest, expressed their enthusiasm about the potential of the partnership to transform the investment landscape.
Toenges highlighted the transformative potential of their partnership with Upvest during its €30 million funding round. This aligns with Upvest CEO Martin Kassing's push for enhanced investment infrastructure. BlackRock's digital expansion includes collaborations with Revolut, an 'ETF Quicklist' with Lloyds (LON:LLOY), and a direct-to-consumer service via Monzo using their MyMap fund range.
A YouGov survey predicts a 32% rise in European ETF investors within a year. This growth is spurred by German online platforms like Scalable Capital and Trade Republic, fractional trading, and the anticipated growth to 20 million ETF savings plans by 2026.
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