One of Visa’s top executives is leaving the payments giant for a brokerage startup, CNBC has learned.
Terry Angelos, global head of fintech and crypto at Visa, will take over as CEO of start-up DriveWealth next week. Angelos joined Visa seven years ago as part of its acquisition of TrialPay, which he founded and led as CEO.
DriveWealth enables consumer finance apps like Block’s Cash App and Revolut to offer stock trading by providing the necessary infrastructure behind the scenes. The Jersey City-based broker was one of the first to allow split investing, or buy stocks in small quantities rather than whole shares.
As retail sales boomed during the pandemic, Angelos said the long-term opportunity is to internationalize US stocks. He estimates that about a billion people around the world, outside of China, access financial services through a digital wallet or fintech app and seek exposure to blue-chip stocks.
“If you would think of the most reliable long-term asset that people around the world want to own, it’s stocks of US companies,” Angelos said. “Traditionally, people outside the United States could not open a brokerage account. It’s something we think we can help solve.”
Corporate America has been less of a safe haven this week, with the Dow Jones hitting its lowest level of the year on Monday. Still, U.S. stocks have posted annual returns of about 10% over the past six decades.
DriveWealth was last valued at $3.7 billion and is backed by Softbank, the venture capital arm of the likes of Fidelity and Citi Ventures, according to Pitchbook. The company operates as a licensed broker, providing clearing and settlement on behalf of its fintech clients, who manage customer experiences and applications.
DriveWealth also offers safekeeping of individual accounts and stocks. To connect to these applications, it uses software known as API or Application Programming Interface. The company said it was doubling its customer base year-over-year, growing 140% among its international partners. Starting with stocks, DriveWealth also offers crypto investment infrastructure.
Individual investor activity has slowed significantly since its peak in 2021 at the time of the GameStop frenzy. According to Rich Repetto, chief executive officer and principal research analyst at Piper Sandler, the retail participation rate, measured as a percentage of total transaction volume, has recently fallen to its lowest level since the start of the pandemic.
The slump hurt the stock of Robinhood, which recently said it was cutting 9% of its workforce after increasing its workforce to meet demand, and hurt other publicly traded brokers.
Still, Angelos said DriveWealth has seen increased participation and account growth during the recent downturn, underscoring the long-term value of US stocks.
“We are still in the growth cycle of making stocks accessible to people who would not otherwise be able to access them and we will continue to see growth even though there may be volatility or setbacks from more active traders,” he said.
As for an IPO, Angelos said it was “possibly on the roadmap.” But for now, he said he is focused on growing his footprint and returning to the role of chief executive after nearly a decade at Visa.