Manage investments via app - with this "all-in-one" tool you keep track

When Sumit Kumar (34) wrote the first lines of code for his finance tool Parqet, he had no idea that he would soon be quitting his dream job. In January 2020 it was, Corona was not yet a pandemic, trading in shares and ETFs for many people beyond their imagination.

Not so for Kumar: The programmer from Hamburg has already invested several thousand euros from his salary on the stock exchange every month. Over the years, his assets were spread across 31 stocks, 15 funds and three bank accounts.

"That became a problem at some point," says Kumar in an interview with "Gründerszene". He constantly had to log into different accounts in order to get an overview of his portfolio holdings.

For example: What were his Tesla shares currently worth? How did the savings plans on ETFs like the MSCI World develop? Where was there a need for optimization?

Questions that even the rudimentary interfaces of the banks could not answer satisfactorily. Clear diagrams and tables? There wasn't. Alternatives like Excel? Were not an option for the family man.

"I wanted something digital, highly automated, accessible on the web and on mobile," says Kumar. So he sat down after work and simply built the tool himself.

Today, Sumit Kumar is one of over 100,000 users who he says use Parqet for their wealth management. Due to the run on shares at the beginning of the corona pandemic, the financial tool has met with a great response over the past two years.

For Kumar, there are other reasons for this: Many young people have dealt with the topic of old-age provision for the first time. At the same time, there was a high level of competition among neo-brokers such as Trade Republic or Scalable Capital, which meant that many investors opened custody accounts with several providers.

For them, Parqet, as an “all-in-one” tool, was the ideal complement, so to speak. Investors can merge their portfolios, find out how their portfolio is doing compared to the Dax, where cluster risks are lurking or when the next dividend will be paid into the account. The program also provides information about market movements, such as which shares are currently popular with other users.

In order to have their securities account analyzed, users only have to upload the order receipts from their bank's mailbox once and in bulk. An algorithm then reads the receipts and creates a portfolio overview consisting of pie charts, charts and tables.

A basic version with limited functionality is free for Parqet users. If you want to display more depots and more in-depth analyses, you pay between EUR 7.99 and EUR 29.99 per month.

Parqet is no longer an after-work project for founder Sumit Kumar. "In the beginning, I worked on the tool alone every evening until about one o'clock in the morning, now ten people are working on it full-time and part-time," says the man from Hamburg. Kumar has now founded a GmbH and recently even quit his job as a developer at billion-dollar fintech Stripe in order to be able to devote himself fully to his company. According to his own statement, he gave up an annual salary of 300,000 euros for this – including stock options.

A big cut for the family man: "We're going without vacations for the time being, want to cook more at home and generally pay more attention to our expenses." He has also significantly reduced his share investments from previously several thousand euros a month.

Nevertheless, he is convinced that his resignation was the right one. He has big plans: "In five years, Parqet will be an international software provider in the field of asset management," Kumar is convinced.

In any case, the direction seems to be right. If you believe the figures that Kumar regularly shares on his Twitter account, Parqet is already recording 3.5 million page views per month a good two years after its launch. The founder also makes his sales public.

The so-called MRR, i.e. the monthly recurring turnover, is around 38,000 euros (as of October 2022). By the end of 2022, according to Kumar's forecast, this value should rise to up to 50,000 euros. Parqet users are very willing to pay. The conversion rate – i.e. the percentage of those who later opt for a paid subscription – is around 15 percent. A decent value for financial software.

However, Parqet is not unrivalled. Other fintechs have also dedicated themselves to the analysis of stock portfolios, which are equipped with significantly more capital for this purpose. Getquin is one such provider: the Berlin-based company has so far made investments of almost 16 million euros. The investors include N26 founder Maximilian Tayenthal and the financial service provider Sino, which has already made the neobroker Trade Republic big.

Parqet, on the other hand, finances itself exclusively from its own resources. "We're cash flow positive and bootstrapping to this day," Kumar explains. So far, he has consistently rejected inquiries from investors. He doesn't see this as a competitive disadvantage: "Of course, the company grows much more slowly because we can't run big marketing campaigns, for example. But this also makes it easier for us to survive times of economic crisis.”

So while highly financed fintechs like Trade Republic recently had to lay off many employees and are trimmed for profitability under pressure from investors, Parqet can continue to grow almost undisturbed. Only on a small scale: "We don't have to worry about running out of money the day after tomorrow," says Kumar.

And there is something else that his company has over other fintechs: it does not necessarily have to advertise its software. Financial influencers such as Thomas Kehl from the well-known “Finanzfluss” YouTube channel (over a million subscribers) use Parqet, for example, to discuss user deposits via live stream.

Lisa Osada, who uses the pseudonym “Aktiengram” (79,000 followers) on Instagram to provide information about investments and asset accumulation, also uses the financial tool for her own portfolio. Both give Parqet a continuous flow of new customers - and free of charge.

No wonder social media and referrals are the most important traffic sources for the fintech so far. However, that could change in the near future: for the first time in the almost two-and-a-half year history of the company, founder Sumit Kumar is planning to invest his own money in marketing. The company's profits were now sufficient for this.

Among other things, search ads on Google are planned. That could bring Parqet to an even broader group of people - which in turn could spark new interest from investors as well. In any case, he no longer rules out a round of financing, as Kumar emphasizes: “I am constantly in talks. There would be enough options.”

"Everything on shares" is the daily stock exchange shot from the WELT business editorial team. Every morning from 7 a.m. with the financial journalists from WELT. For stock market experts and beginners. Subscribe to the podcast on Spotify, Apple Podcast, Amazon Music and Deezer. Or directly via RSS feed.