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Scalable Capital, a German investment platform backed by BlackRock, has raised €155mn in fresh equity at a valuation of about €1.5bn, as part of a push to become a pan-European investment powerhouse in the model of Charles Schwab.
“Every European market has its own banks [ . . .] and a pan-European Charles Schwab really doesn’t exist yet,” said co-founder and former Goldman Sachs banker Erik Podzuweit. “This is what we aspire to become.”
Some of the new capital would be directed towards expanding operations in growth markets such as France and Italy, Podzuweit told the Financial Times, while “the biggest chunk will sit on our balance sheet” as a buffer to support future growth.
The company aims to grow client assets from €30bn to more than €100bn within the next two to three years, as it seeks to close the gap with Berlin-based rival Trade Republic.
Cross-border competition between European fintechs has been intensifying.
Trade Republic co-founder Christian Hecker has expressed similar ambitions to become the “Charles Schwab of Europe”. It has more than €100bn in client assets and serves more than 8mn customers, and has been expanding aggressively in critical markets such as France and Italy by tailoring its product suite to local needs.
Meanwhile, Revolut, the UK-based digital banking group with more than 55mn users globally, has committed to investing more than €1bn in its new western European headquarters in Paris, underscoring its ambition to gain market share on the continent.
Scalable’s funding round, led by Belgian investor Sofina and European growth equity firm Noteus, brought in new backers alongside existing investors including Balderton Capital, HV Capital and Tencent.
It was last valued at about €1.3bn in a December 2023 funding round.
Podzuweit said Scalable still had roughly half of the €300mn raised in earlier rounds available and aimed to be profitable next year.
The fintech’s infrastructure was tested in April when markets were jolted by tariff threats from US President Donald Trump, prompting a sharp sell-off followed by an equally rapid rebound.
Podzuweit said trading volumes on the platform hit record highs. Traffic surged sevenfold in a single day, he said, leading to record trading fee income.
“Who knows — if Mr Trump creates more volatility, we might hit profitability faster,” he said.
Some users reported issues in accessing their accounts during peak traffic, but Podzuweit insisted these were mere “delays”, not outages, and that trading functionality was unaffected. Germany’s financial regulator BaFin has since launched a review into the resilience of brokers under market stress.
Scalable is applying for a banking licence in Germany, which would allow it to expand banking operations to other EU member states.
But Podzuweit said the “game-changer” for the company would be if the German government went ahead with plans to boost retail investment through tax-incentivised or subsidised savings plans.
“Hopefully the government still finds the time — and the money — to make it happen.”
https://www.ft.com/content/a599713f-c467-48ea-a49b-a93d31eaeb3c
