UK-based fintech Sidekick has raised a £3.3m pre-seed round to help well-off millennials become richer, by providing them with the kind of active investment management that high-net-worth individuals enjoy.
What does Sidekick do?
Sidekick’s CEO and cofounder Matt Ford tells Sifted that its app is designed for retail investors who want to grow their wealth, and gives them access to active portfolio management, educational tools and the ability to invest in assets like crypto and private equity. Active portfolio management means that a portfolio manager makes buy and sell decisions with the goal of beating the performance of a standard benchmark.
It’s not exactly aimed at everyone. Sidekick is targeting what it’s called the “aspirational mass affluent”: 29-49 year olds who earn between £80k and £180k a year, many of whom are tech founders. The minimum investment is £1000.
“They’re doing well, but they don’t feel rich,” Ford explains. “They have savings but they’re not really deploying them in the right way or moving them forward.”
Sidekick wants to provide this target market with the kind of information that a high-net-worth individual gets on the phone to their asset manager — through its in-app content, updated daily. “A professional investor has access to Bloomberg and all the tickers on a screen and retail investors don’t have that. So we’re bringing it to them,” Ford says.
Sidekick charges an annual management fee of 1% of the amount invested in each portfolio, which may vary slightly depending on how actively managed each portfolio needs to be — eg., it might be slightly higher for crypto.
Sidekick is currently awaiting full regulatory approval, and plans to grow its team from six to twnety-six in the next twelve months. Its focus is on the UK for the first couple of years, then it plans to start expanding into new markets.
Who’s founded Sidekick?
Sidekick’s founding team is full to the brim with seasoned tech entrepreneurs and investment professionals. Its cofounders are:
- Ford, who was previously founder and CEO of money management app Pariti, which he sold to Tandem Bank. Most recently, Matt was a partner at fintech VC bigwig Mouro Capital, where he sat on the board of Uncapped and DriveWealth.
- Chief technology officer Pete Townsend, who was also CTO at Pariti and then head of engineering at Tandem.
Who’s invested in Sidekick?
- UK VC firm Octopus Ventures led the round
- Early-stage VC firm Seedcamp
- Crypto VC firm Semantic
- Will Neale, founder of Grabyo
- Michael Pennington, cofounder of Gumtree
- Ricky Knox, cofounder of Tandem Bank
- Michael Kent, cofounder of Azimo
- Freddy Kelly, cofounder of Credit Kudos
- Serial fintech investor Mark Ransford
Currently, retail investors in Europe have two options if they want to generate wealth. They can make individual stock bets on trading platforms of the likes of Freetrade, Shares and Lightyear. Or they can access broader passive investment opportunities and ETFs through the slew of robo-advisers on the market like Nutmeg, Moneyfarm and EToro.
Sidekick is trying to give them the best of both worlds by letting them access the wisdom of financial professionals who would normally be very pricey. There are already competitors in the US like Titan, which is backed by Andreessen Horowitz, and Domain Money, which is backed by Bessemer.
That said, active versus passive investing (tracking an index) is a debate in investing circles; over the longer term, passive investment strategies have been shown to outperform active strategies, while active strategies perform well in certain situations.
Amy O’Brien is Sifted’s fintech reporter. She authors Sifted’s fintech newsletter and tweets from @Amy_EOBrien.