Why Timur Turlov is constructing a diversified ecosystem of monetary and life-style companies
Many firms attempt to present their purchasers with a wide range of companies as of late and if these companies meet expectations and fulfill the wants of their clients, a win-win scenario is created.
Freedom Holding Corp. is one such firm that delivers win-win conditions, time and time once more. And with their second quarter fiscal 2024 monetary report of $436 million in a income, a 142% yr over yr enhance, the proof of their profitable technique of offering a diversified suite of monetary companies to fulfill their buyer’s wants, is abundantly clear.
The ecosystem of monetary companies below the Freedom model in Kazakhstan accounted for the lion’s share of this income the place Freedom Financial institution earned $388 million, Freedom Finance International (working internationally) — $86 million, Freedom Dealer (working in Kazakhstan’s jurisdiction) — $35 million, and Freedom Life and Freedom Insurance coverage — $63 and $18 million, respectively.
How has this ecosystem emerged and why is it rising so quick?
From a easy native retail brokerage grows a multi-national, diversified monetary companies and know-how group…
Freedom was established 15 years in the past amid the worldwide monetary disaster by former managers of the UniastrumBank led by Timur Turlov. Younger professionals of their early 20s, they determined to determine a brokerage firm to be able to render companies to the financial institution’s purchasers within the U.S. inventory market. Since then, the corporate has expanded and reworked into a world holding firms with department places of work in 16 nations within the CIS, Europe, the Center East, and the U.S. with greater than 7,000 workers.
Freedom Holding Corp.’s shares are listed on Nasdaq below the ticker image “FRHC” and the safety’s value has risen six instances for the reason that first day of itemizing in 2019.
Freedom’s extremely diversified monetary ecosystem in Kazakhstan is the core ingredient of the group’s enterprise. It consists of: the retail financial institution; an e-payment system (Freedom Pay); two insurance coverage firms; on-line airline ticket companies; inventory brokerages; and a telecommunication operator. Based on Turlov, the founder and chief govt officer of Freedom Holding Corp., the enterprise was structured this manner for a purpose. “The ecosystem is designed to provide us extra buyer touchpoints than another enterprise in our area. This gives us with a excessive degree of consciousness and knowledge which, after in-depth evaluation, permits us to extra effectively deploy capital and ship services and products that our buyer’s need and want. Higher enterprise merchandise, higher companies, and a greater general buyer expertise all contribute the win-win success we attempt for in our firm and helps us add to our buyer base,” he underlined.
It’s value noting that every ingredient of Freedom’s universe is ranked among the many leaders of their industries. Freedom Financial institution, with greater than $4 billion in belongings, is without doubt one of the prime eight monetary institutes in Kazakhstan and has been quickly rising thanks to very large demand for its flagship merchandise: digital mortgages and digital automotive loans.
Freedom Dealer is the chief of the inventory brokerage in Kazakhstan. By way of its department community of 13 consultant places of work all through the nation it renders companies to 220,000 clients. The corporate accounts for greater than 50% of buying and selling on KASE, the most important inventory trade in Kazakhstan. “I feel it’s secure to say that now we have a majority of the market share within the Kazakh area,” stated Sergey Lukyanov, chairman of the corporate’s board of administrators.
Since 2020, Freedom has additionally been creating its worldwide brokerage arm, Freedom Finance International, to be able to facilitate entry to main world exchanges similar to NYSE, Nasdaq, and the LSE, for greater than 120,000 retail traders.
Freedom Insurance coverage (FI) and Freedom Life (FL) characterize the insurance coverage enterprise division of the company, with a main give attention to automotive and life insurance coverage. FL is the one firm within the nation that processes and pays insurance coverage advantages via the net insurance coverage portal dtp.KZ, a service specifically designed for this objective. Based on Azamat Kerimbayev, CEO of Freedom Insurance coverage, this on-line service has lowered the insurance coverage advantages cost course of by 16 instances to simply 5 enterprise days.
Presently, Freedom Life accounts for 16% of the life insurance coverage market share in Kazakhstan and the corporate desires to broaden this place considerably by 2028.
After acquiring the required licensing from native regulators, Freedom’s contactless e-payment system, Freedom Pay, operates in Uzbekistan, Kyrgyzstan, and Kazakhstan. The corporate now accounts for each third on-line cost in Kazakhstan the place it processes roughly $250 million in e-pay transactions per 30 days on common.
New additions to the Freedom enterprise are anticipated to contribute to the corporate’s future success. Freedom Telecom, the telecommunications operator just lately launched by the corporate, goes to give attention to creating reasonably priced mounted and cellular web by increasing the 5G normal telecommunication community in Kazakhstan. Moreover Freedom has made investments in life-style e-services suppliers similar to on-line air journey companies, a food-tech/grocery group, in addition to an e-ticketing live performance and leisure group, all designed to reinforce the Freedom buyer expertise.
Increasing borders
A number of years in the past, Freedom determined to develop its worldwide enterprise and has opened department places of work within the U.S., Europe, Central Asia and the Center East.
Within the American market, the corporate was seeking to construct a completely useful funding financial institution that wouldhelp native firms enter capital markets via IPOs and secondary choices. With this objective in thoughts, 2 years in the past, Freedom acquired Prime Executions, an American dealer with direct entry to NYSE. Moreover, within the spring of 2022 Freedom Capital Markets, the U.S. subsidiary of the group, obtained underwriter and funding banking licenses from U.S. regulators and some months later, it participated as an underwriter for the general public choices of Depth Therapeutics (INTS), Beam International (BEEM), VolitionRx Restricted (VNRX), Contango ORE (CTGO) and DayDayCook (DDC).
Freedom’s headquarters for its European division arelocated in Cyprus, offering the corporate’s clients higher entry to main exchanges all over the world. Freedom can also be contemplating increasing its footprint to incorporate Azerbaijan, Turkey, and UAE markets the place it expects to leverage the expertise it has gained in Kazakhstan to supply its most profitable merchandise to clients in these areas.
One cease procuring…an all-in-one e-marketplace
Freedom Holding Corp.’s enterprise growth technique is based on the premise of the synergy created by its diversified product choices. Assist for this technique is evidenced by Freedom’s quickly rising buyer base who proceed use increasingly of the corporate’s fee-based companies, in addition to spend money on the corporate’s inventory.
“We wish to construct a completely useful and deeply built-in fintech ecosystem with numerous banking, telecommunication, and life-style product choices that generate the type of huge knowledge that enables us to proceed innovate and construct know-how and monetary bridges,” Turlov stated, “now we have at all times been good at constructing strong bridges; that is our energy,” he concluded.
