British trading app Freetrade says chief executive Adam Dodds will step down

LONDON — The head of British stock trading service Freetrade is stepping down and leaving the company with immediate effect, the company told CNBC exclusively on Monday.

Adam Dodds, who co-founded the company with business partners David Fioranell and Victor Nebehai in 2016, will be replaced by Nebehai, currently Freetrade’s COO, as CEO, pending the usual regulatory approvals.

Dodds remains the largest individual shareholder in Freetrade, owning a roughly 12 percent stake, according to company filings. He will no longer be involved in the company’s day-to-day operations, but a Freetrade spokesman said he will continue to support the company’s development from an “external perspective”.

Dodds felt it was the right decision to leave the company and have Nebehaj take the reins as it enters the next stage of its growth trajectory, which includes plans to push out new products including bonds and mutual funds, tax wrappers and its Web platform as well as expand its core profitable user base in the UK.

“When you reflect on the journey from idea to over a million users with billions of assets, it’s the tough times that you remember the most,” Dodds said in comments shared with CNBC. “We’ve almost died so many times it’s hard to count.”

“Now that we’ve delivered our first profitable quarter and with a solid sustainable business foundation, it’s time to hang up my skates. Freetrade is live by default and ready to take on current UK platforms with self-sustaining growth,” Dodds said.

Dodds added: “I am very happy to say that Victor will be stepping up to take the helm as CEO. I will do my best to support him and the company from the board. As for me, I’m looking forward to getting to know my kids better, teasing my wife on the farm, and finally getting my pilot’s license.”

Nebehai, Freetrade’s incoming chief executive, applauded Dodds’ eight-year tenure as chief executive and said it was “natural that different stages of a company’s growth require different leaders”.

“With our first profitable quarter behind us, I am excited about the size of the opportunity ahead,” Nebehaj said in a statement. “Our talented and high-quality team builds the right product for our customers.”

Perry Blacher, chairman of Freetrade’s board, said Nebehaj “is ideally placed to lead Freetrade from strength to strength”.

Dodds’ departure follows a tumultuous ride for the company in recent years. Dodds took Freetrade from a scrappy startup in the early days trying to disrupt the world of wealth management to a 150-person company with over 1.4 million users.

In 2020, Freetrade included thousands of users per day as retail trading activity boomed after The GameStop stock trading saga, which has seen a community of hardcore fans of the American video game retailer, boost the company’s share price.

More recently, it has been forced to tighten its belt as the reality of a bleaker macroeconomic environment set in. Freetrade has announced measures to cut 15% of its workforce in 2022 as it seeks to push towards profitability.

The following year, Freetrade raised £2.3 million ($2.9 million) in a crowdfunding round on Crowdcube at a valuation of £225 million – a 65% discount from its previous valuation of £650 million. At the time, Freetrade blamed a “different market environment” hit by higher interest rates and inflation.

Most recently, the company had news to cheer about. Freetrade reported its first quarterly profit in the three months to March, according to unaudited financial statements shared with CNBC in April. Preliminary earnings reached £6.7m for the quarter.

Freetrade is still generating an annual loss of £8.3m in 2023, down from the £28.8m loss it racked up the previous year, while revenues rose 45% to £21.6m in the same period from time.