Ingmar please tell us a little about the background of Tickmill and how the Group is structured.
Tickmill is a group of companies today serving traders in more than 190 countries. We offer brokerage services for Futures, Options, FX and CFDs traders in underlying products that span all the major asset classes including stock indices, commodities, bonds and FX. Our origins go back to 2010 when along with other two co-founders, Nikolai Nikolajenko and Illimar Mattus, we created the business which eventually became Tickmill. We are primarily known today as an FX brokerage firm that serves mostly demanding algorithmic traders, and due to the ability of the algorithms to trade 24/5, it translates also into massive trading volumes which we constantly report to the public. In March, 2021, for example, we reached a record trading volume of $195.6 billion notional value. Aside from serving tens of thousands of active individual FX traders, we have also a growing institutional business through which we mostly serve either other brokers or regulated proprietary trading firms whose business focuses on FX.
Today we employ 235 team members through our main offices in London (United Kingdom), Limassol (Cyprus) and Tallinn (Estonia). We serve clients through 5 regulated entities, all bearing the brand of Tickmill and separately regulated by some of the world’s most reputable regulatory bodies including the Financial Conduct Authority in the UK, the Cyprus Securities and Exchange Commission in Cyprus, the Financial Services Authority in Seychelles, the Labuan Financial Services Authority in Malaysia and the Financial Sector Conduct Authority in South Africa.
In general, we aim to have a regulated entity in all regions where we have a growing size of existing business, or we see meaningful future potential. As such, we have already been in discussions to expand our presence by obtaining additional licenses. Our brand is usually associated with reliability, trustworthiness and with the idea of putting clients always first.
What do your own day to day responsibilities within the firm usually involve?
I am a member of the Group Board of Directors and on a daily basis I perform duties of Group COO overseeing group operations, brokerage, IT and Product development but as part of the overall management team I am involved in all aspects of the business, regardless of which field it is. My objective is to always make sure that our clients receive the best available service in a consistent and reliable way and that they can feel comfortable dealing with Tickmill as a counterparty. While clients often see the front end of the business there are actually more complexities in the back-end which clients never see. In a highly regulated environment where we operate in, we have to always be two steps ahead and make sure that we have backup plans and contingencies in place so that clients can rely on our services.
To give some perspective to the readers, in Q1 2021 the total number of trades we executed for our clients exceeded 38 million. We have extremely robust systems in place to be able to perform our duties, and on a high-level, it is my ultimate responsibility to make sure that the machine works all the time.
Tickmill has clearly gone about creating a company that delivers the trust and security that traders are increasingly looking for. How would you describe the principles that guide the business?
All of the original founders, most of the current shareholders and the top level management team members have previous trading experience. Mostly it is with Stocks, Futures and Options. Therefore, we breath the same air like our trading clients, and we understand how difficult it is to reach success in trading. Our founding principle was and still is that whatever we do, we make sure that we offer only the absolute best trading service to our clients even if sometimes our bottom line might suffer because of this. It is no surprise then that since our inception, we have offered one of the lowest commissions and spreads in the industry while having also one of the fastest trade execution speeds. We never make compromises in terms of service quality.
What is also very important with Tickmill is the fact that we run the company as a family business. We treat everybody equally and anybody can have a say or provide feedback on any matter of the business. This has created an environment of openness and transparency within the firm. Understanding the traders’ mindset, offering the best services to them with a motivated team that enjoys doing so, is something that clients feel and it is therefore the foundation of our growth.
Who are the key members of Tickmill’s global management team?
We consider every member of the team to be equally important in the company, but the group is effectively managed by the Group Board of Directors which comprises of eight people including the CEOs of regulated entities. This group consists of all three founders, CEO of Tickmill UK Ltd, Duncan Anderson, CEO of Tickmill Europe Ltd, Valerijus Ovsianikas, CEO of Tickmill Ltd, Sudhanshu Agarwal, CEO of Tickmill Estonia, Andres Vahopski and Group CFO, Derek Wilks. All of us meet every Monday to discuss strategic business matters.
The Tickmill team have many decades of trading experience. In what ways has that helped the firm to design and engineer an exceptional trading environment that empowers your clients to reach their full potential?
As most of us in the management team have been actively trading the markets before through many other brokers, we have a very holistic understanding as to what aspects of the services are important for the end client, the traders. The core elements of the exceptional trading environment are low trading costs, fast execution and an extremely clean and reliable trading environment without any artificial delays or other interferences. As our client base mostly comprises of algorithmic traders, who by nature are tech-savvy, they have tools which are easily able to assess the quality of the trading environment. The fact that we have so many of them trading with us is a testament to the good work that our global team has done over the years, and we really appreciate this.
What types of clients are you serving and in what ways has this been evolving and changing since the business started?
Originally when we started, our focus was on providing very good service quality and since we did not have any advertising budget, we did all the marketing ourselves by going out to free venues such as forums and trading groups. We did not know at that time that we would start attracting successful algorithmic traders but since these traders are generally very smart, they were just attracted by the quality of the service. The types of clients who we serve have not drastically changed over the years, although our global expansion has created different pools of clients based on the demographics and financial literacy of the population. Our most successful clients generally come from developed countries such as Germany, UK, France, Italy and some spots in Asia. Our recent expansion into Futures and Options has also started to bring in successful futures traders who we previously did not serve and in general we think that in a few years’ time we should get a quite healthy part of our business from Futures and Options.
What markets and financial instruments can be traded with Tickmill?
We offer real Futures and Options from exchanges like CME, CBOT, NYMEX and others, as well as CFDs on every major asset class out there including FX, Commodities, Bonds, Precious Metals, Stock Indices. We will very soon start offering CFDs on single stocks and also some very select cryptocurrencies like Bitcoin and Ethereum.
What range of platforms do you offer traders?
Futures and Options traders can trade with us through the CQG platform and also through Tradingview, MultiCharts and Sierra Charts. We are also able to connect any other major Futures platform out there that has API connectivity with CQG. FX and CFD traders use our MetaTrader 4 and MetaTrader 5 platforms. In general, we aim to provide our clients with popular trading platforms that have reached critical mass of users.
Tickmill offers some very powerful trading toolsets. Please tell us a little more about those.
We offer our clients a wide selection of trading platforms and a variety of platform-specific tools for charting, risk analysis, trade management, etc., that make the life of the trader easier. We also offer various analytical tools such as Autochartist, FXBlue and Acuity that enable the clients to improve their decision-making processes. We also provide a variety of trading webinars and seminars, one-to-one sessions for some client groups where we train the clients to use the tools properly.
What do clients particularly value about trading with Tickmill and why are increasing numbers of them choosing you as their preferred broker?
Aside from the good trading conditions, we often hear back from clients that they like our reliability, openness, transparency, and predictability. In terms of predictability, clients appreciate the fact that we always deliver, and whatever the circumstance, we will not let the client hang out in the rain. Clients should not expect from us anything unexpected, and I think over the years they have come to understand this. In terms of transparency, this also derives from our internal culture; we like to share information about our firm also with our clients. Although we are not a publicly listed company, we do publish our financial results annually. We do this because we want our clients and counterparties in general to know that they are dealing with a financially stable and trustworthy counterparty. Clients also value that they always know in our case who they are dealing with, who are the top-level managers, who are the faces behind the company. We have employed a personal approach in our communication with the outside world and this has helped us to build a lot of strength not only with the clients but also with other counterparties, including the regulators.
How important is it for Tickmill to try and ensure that your interests are fundamentally aligned with clients wherever possible and how have you gone about achieving that?
Having our interests aligned with the clients is a fundamental part of our culture. Whenever we make any decisions, we always think how this would affect the clients. For example, we are proud that in the cases of Swiss Franc melt-down or Brexit referendum, we preemptively increased the margins for all of our client base, in some cases much earlier than our competitors. We did this first of all to protect our clients, but also to protect the firm. If clients are strong and loyal to Tickmill, then Tickmill is also strong.
We pay a lot of attention to what our clients write about us in various public forums because we want to make sure that they are happy with our service and if we can detect any spots where we can improve, then we always make best efforts to make it happen. In a way, we walk the same road with our clients; in order for us to succeed in the long term, the clients must value our relationship with them, and this can only come from good service and by putting clients’ interests first.
What role has technology played in the success of Tickmill and how are you leveraging it to attract new clients and further strengthen your offering by opening up new investment and trading opportunities?
While we use third-party trading platforms, most of our internal systems covering areas such as back-office, payments, risk management and many other non-visible systems are proprietary. Our internal systems are reliable and platform-agnostic which enables us to easily switch on or off trading platforms, payment systems, client communication tools, etc. To a large extent, if we had also our own front-end platform, then we could say that the majority of our technology is proprietary, and this is something that we are seriously considering lately. As our internal systems are robust and scalable, it is quite easy for us to add new platforms, new tradable products and this enables us to be dynamic towards shifts in market trends and be ready to meet any client demand out there.
Our last major strategic push in the technology front has been the launch of our very own back-office system which is the engine that connects all our internal and external systems and enables us to offer seamless service to our clients. Over the last two years, our whole organization did a very good job preparing for the launch of Futures and Options products which we did just a few months ago. We hope to continue on the same path to be able to constantly surprise our client base with new offerings.
What services do you provide for institutions that are looking to partner with Tickmill?
On the institutional domain, our focus over the years has been to provide liquidity for small and medium-sized hedge funds. It is not a major business for us, but it has been growing and we are quite well known in some of the hedge fund centers like London and Singapore. We believe that on the FX side we are able to provide some of the best execution quality out there. Eventually, we hope to expand also to the institutional space with our Futures and Options offering but our first objective in this front is to build up a sizable retail book, cross-selling Futures to our existing FX and CFD client base.
Do you see increased regulatory oversight of FX and CFD trading as a positive step and an opportunity for Tickmill to differentiate itself?
At Tickmill we embrace regulation. Not that it makes our life easier, but it makes the playground even and improves the overall stability of the ecosystem. We have come to understand that increased regulatory oversight will eventually consolidate the industry quite a bit and only well-capitalized and reliable firms will be able to survive. As we have currently $50 million of net capital base in Tickmill Group, we are very well positioned to weather any additional regulatory changes or periods of low profitability and are able to play a big part in consolidating the industry also through our own acquisitions. In the long term, we see that the increased regulatory oversight will make the larger firms in the FX and CFD space, including Tickmill, much stronger and this is not only an opportunity for Tickmill but also for our current and future client base as we will be able to offer an even larger product and platform offering, new trading technologies and tools, under a reliable and safe network of globally regulated investment firms all operating under the Tickmill brand.
What steps are going to be required from leading providers like Tickmill to attract a new generation of traders whose expectations in terms of product mix, platform functionality and trading opportunities are getting increasingly higher?
Obviously as the technologies and the end clients become more and more sophisticated, we have to adjust as well. On the product front we must constantly expand our offering, we have to provide additional trading platforms, more payment systems to each country so that we are able to facilitate payments for the clients and we also have to be very cost-focused as the wider brokerage industry is going through the downward spiral of continuously lowering pricing for end clients. One can only do that through technology and in that sense, over the next few years we will most likely be hiring more technology people in Tickmill than any other people. Aside from technology, we must also constantly evolve in terms of how we market and sell our products and boosting creativity in our marketing teams is something we are always focused on to be able to engage our clients with information and content that provides value to them and that enables us to differentiate from our competitors who we have many.
How do you see the retail financial trading market evolving over the next few years and how is Tickmill preparing to capture the opportunities this will present?
Retail financial trading environment will become more competitive as there are more and more entrants coming to this space, especially from the fintech front. Some of the brands that may be globally known in five years from now may not even exist today or they are still under development. In order to compete on this front, we have to be constantly on the leading edge to meet the demand and needs of our clients and in a lot of cases this means innovation and technology. In the wider internet space, globally, nobody is able to compete today with Amazon, Google, Facebook and the likes. It is possible to compete with them only in some local markets with localized approach. In the retail financial trading space, globally, in five years, the market may also be divided by 20-30 firms who offer investment products from A to Z and through platforms that most likely are quite simple but extremely user-friendly and hyper-intuitive. As such, we are constantly monitoring what is happening on the global retail financial trading space to the extent that we are also willing to do acquisitions of any interesting technologies that enable us to capture more clients, offer more products or in general run our business in a more efficient way.
In such a competitive market, how has Tickmill gone about trying to distinguish itself among global Forex brokers?
The distinguishing factor in the case of Tickmill is first of all, being run by people who actually understand the brokerage business and what the end clients’ needs are. We have been successful in combining various trading technologies, business development and marketing experience and excellent customer service to deliver a final product that stands out with its ease of use, competitive pricing, and reliability. Offering this from a firm that is open and transparent and when a CEO of the firm is literally one email away for any client is something that distinguishes ourselves from most other firms out there. We are reachable, we listen, and we try to support all of our clients in the best possible way.
What regions around the world will you be focusing your efforts on to strengthen Tickmill’s presence over the next few years and why are these important?
We have been historically strong in Europe, Asia, the Middle East and Africa region. Our growth markets for the next few years aside from these regions are South America and eventually also North America. We are constantly on the lookout for new partners in most markets and we have financial strength inside the firm and also outside from our shareholders that enable us to seize any kind of opportunities stranding from organic growth with existing or new products or acquisitions of other brokers or technology providers. We live in very dynamic times and we as a team are quite sure that there are many interesting opportunities still ahead for our firm.