Stockpile Launches Innovative Equity Trading Platform with InnReg’s Support
Stockpile is a fintech company founded in 2010 and headquartered in Palo Alto, California. The company offers a stock market investment platform that allows users, especially young and first-time investors, to buy fractional shares of stocks and ETFs for as little as $5.
A unique feature of Stockpile is its stock gift cards, which can be redeemed for stocks or cryptocurrencies, making investing more accessible and engaging. This approach helps introduce investing to new audiences, including minors, through custodial accounts managed by parents.
Stockpile operates as a registered broker-dealer and is a member of FINRA and SIPC. Bakkt Crypto Solutions LLC provides its cryptocurrency execution and custody services. Stockpile has raised over $45 million in funding and continues to focus on simplifying investing for a broader audience.
Objective
Stockpile aimed to launch a new equity trading platform designed to be accessible and engaging for retail investors, particularly younger and first-time investors.
The goal was to create a fun, low-cost environment for learning about stock trading and to broaden access to the stock market through innovative features such as fractional shares and stock gift cards.
Background
Stockpile sought to develop a trading platform that would demystify stock trading and make it more accessible to everyday people, especially younger and first-time investors.
To achieve this, the company envisioned a platform combining the simplicity of online brokerage accounts with the unique concept of stock gift cards and e-cards, allowing users to easily gift and invest in stocks.
This innovative approach aimed to open up Wall Street to a broader audience by providing a user-friendly, low-risk entry point to investing. However, the complexity of their product design, which included custodial accounts for minors, fractional shares, and partnerships with national retailers, required a well-defined regulatory strategy and a scalable, cost-efficient operational system.
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Challenges
Stockpile faced several challenges in bringing its innovative trading platform to market:
Attracting New Investors Without Regulatory Issues:
The platform was designed to appeal to younger and lower-net-worth investors, which required careful navigation of regulatory frameworks to avoid raising red flags or attracting negative attention from regulators.Managing a Complex Product Offering:
The platform included features such as custodial accounts for minors, fractional shares, and stock gift cards and e-cards, which added layers of regulatory complexity and required a clear and compliant operational strategy.Building a Cost-Efficient and Scalable System:
To support their growth plans, Stockpile needed to develop an operational system that was both cost-effective and scalable. This meant negotiating favorable vendor contracts, managing compliance costs, and handling high transaction volumes efficiently.
InnReg’s expertise was crucial in helping Stockpile navigate these challenges, create a regulatory-compliant platform, and support a successful launch.
InnReg's Solution
InnReg developed a comprehensive compliance and operational strategy to help Stockpile successfully launch its innovative trading platform:
Designing a Robust Compliance Platform:
InnReg created and implemented a compliance framework tailored to Stockpile’s unique needs, ensuring accurate and secure transactions while maintaining high-speed processing capabilities. This framework was built to support features like fractional trading, custodial accounts, and the distribution of stock gift cards, all while adhering to regulatory standards.Negotiating Strategic Vendor Contracts:
To support the platform's operational efficiency and cost-effectiveness, InnReg advised Stockpile on negotiating profitable vendor agreements, including a multi-year clearing agreement that helped with both scalability and cost management.Advisory on Regulatory Strategy:
InnReg provided ongoing strategic guidance on regulatory requirements, helping Stockpile navigate the complexities of offering innovative financial products aligned with SEC and FINRA regulations.
By providing expertise in compliance, vendor management, and regulatory strategy, InnReg positioned Stockpile to launch its platform smoothly, attract a new generation of investors, and drive significant growth.
Client Results
With InnReg’s guidance, Stockpile successfully launched its innovative stock trading platform, securing $15 million in Series A funding and receiving positive press coverage. The platform’s stock gift feature contributed an additional $50 million in revenue through partnerships with major retailers such as Target, Safeway, and Staples.
Stockpile’s achievements were widely recognized in the fintech industry, earning numerous awards, including Product of the Year and Most Disruptive Company.
