Founded in 2017, the startup Upvest has blossomed into one of the most interesting German fintech companies. As an infrastructure service provider for securities trading and financial investments, the Berlin-based company is as business-to-business as you can get. Its steadily growing customer list shows that the demand for trading services is not diminishing. N26, Revolut, Raisin, WeBull, Openbank (Santander), Visualvest (Union Investment), and most recently DKB have been added as new customers.

Upvest caused quite a stir when it replaced DWP Bank as the securities service provider for BayernLB subsidiary DKB. A prestigious mandate with a lot of potential. „With more than five million customers, DKB currently has a good 860,000 securities accounts and now wants to expand its stock and investment business,“ says Upvest CEO Martin Kassing in an interview with Börsen-Zeitung. The fintech's tech platform could support the direct bank in scaling up by displaying processes in real time in the accounts, from trading to portfolio management. Kassing: „And, of course, the costs per trade play a role.“

BayernLB CEO Stephan Winkelmeier had already criticized DWP Bank as a service provider in July. At the time, he noted that DKB was not competitive in the securities business because of DWP Bank. The latter would process transactions at conditions that meant it lost money on every securities transaction. Shortly after the switch to Upvest in September, DKB announced that it would be working with the fintech company to build a securities account platform that would also make it easy to implement offerings such as children's securities accounts and early retirement pensions.

These are topics that are currently exciting Kassing: „We have already done a lot of preliminary work and we are ambitious to be able to launch the children's securities accounts for early retirement pensions and the retirement savings accounts right at the beginning of the year with the best product for our customers.“ Kassing is optimistic that the legal framework for this will be passed as planned in mid-December and that, in addition to funds and ETFs, ELTIFs will also be eligible for custody accounts within the tax-privileged framework.

Upvest has raised a cumulative total of around 175 million euros in venture capital and invested extensively in infrastructure. This starts with a cloud-based core banking system to which the other modules are connected. This enables the fintech company to present fractional shares, automated portfolio management solutions, and savings plans in an API-compatible format.

According to Kassing, this makes the start-up more compatible with traditional banks that want to fill gaps in their service portfolio. In all discussions, it is clear that the institutions are preoccupied with the question of how to position themselves for the future.

More than 30 institutions in Europe are already connected to the Upvest platform, most recently Salt Bank, a Romanian neobank. From contract to onboarding, it took just one to three months for fintechs. Bank migrations such as the recent one by Openbank usually require six to twelve months of lead time, says the founder. So the pipeline always takes a lot of time to develop.

Upvest is also busy making a whole range of other products and assets investable. „And our ambition is to have several hundred billion euros in assets on the platform by the end of 2030.“ He does not want to reveal a current comparative figure, but says that around 100 million transactions will be processed this year.

Kassing expects the company to be profitable by 2027, perhaps even sooner. This also depends on how overall management is handled, for example, if additional investments are needed to seize opportunities. In the long term, there is also the option of an IPO, with 2030 as the target date. But all options are open, either through a further round of equity financing or by raising debt capital to gain additional leeway.

„We have definitely shown that we can deliver added value to many banks, brokers, and asset managers with our range of services, enabling them to grow faster and save costs,“ says Kassing confidently: „We are continuing to develop Upvest on this basis.“ There is plenty of potential: there are around 10,000 banks in Europe.