Table of contents
- Trade for good
- Founders - Alistair Warren and Ben Galamaga
- Based in Melbourne
- Started in 2020
- 2 founders, 2 employees
Alistair, what's your backstory?
I’m the youngest of three from a middle-class family with two loving parents who next year will celebrate their 65th wedding anniversary.
I grew up in Mt Waverley in Melbourne and had an awesome childhood. Lots of neighbourhood kids to play with, always out and about on my bike or down the local creek exploring and having fun.
Schooling wise I went to the local primary school and then onto the local Tech school, Syndal Tech. The Tech schools back in the day were focused on the trade subjects like plumbing, woodwork and electrical etc, all the things that didn’t resonate with me. Luckily, they did have accounting and economics which I did find interesting.
The other unusual thing about Tech schools is that they only went to year 11, I assume they expected students to go off and get some sort of apprenticeship. For Year 12 I had to go to Box Hill Tafe, and boy, that was interesting, it was like going to first-year Uni but trying to complete year 12.
There was always something on to distract me from my studies, whether it was band’s on a Thursday night or going to Adelaide for the arts festival. Safe to say it was a great social year 12 but not so good for results! I scraped by with a pass but not good enough to get me into any university courses.
At the end of 1986, I needed to decide what I wanted to do and to be fair, I had no real idea.
A good friend of the family was a Merchant Banker, so I thought Mr Watson seems to do well, I will become a Merchant Banker, I quickly learnt that wasn’t going to happen without an economics degree.
Lucky for me, it was the height of the 80’s bull market, and one of my brother’s friends worked at Potter Partners, one of Australia’s premier stockbrokers, so they got me a job interview as a messenger. Things didn’t work out for me at Potters, but I did get a messenger’s job at McIntosh Securities Melbourne’s finest stockbroking firm, way better than Potters!
WOW, what an introduction to 80’s stockbroking, it was everything you would imagine it to be. In the messenger department, there were twenty odd young kids running up and down Collins Street all day, doing stock settlements or picking up the trading slips from the trading floor.
The trading floor was mad, people yelling and screaming at these poor people called chalkies, who would scribble the prices of stocks on the chalkboards. There was a certain art to trading shares back then.
It was so busy back then that you were quickly promoted out of the messenger department and would land anywhere that needed more help.Lucky for me, I landed in the bookings department.
The role of the bookings department was to try and work out what the operator (trading floor trader) had scribbled down on the trading slip and match that to a client order to buy or sell. This was easier said than done, given the manic way the trading floor used to operate.
At the end of the day, you would have piles of these slips that needed to balance with what the operator had thought they had traded. Then they had to be punched in the computer system and booked out to a client.
This was always the high-pressure part of the day. The operators were always in a mad rush to balance their books, so they could head off to the pub to relive the day’s trading activities and drink 1,000 beers. Lucky for us the drinks trolly came around at 5 pm every day, which helped us try and stay sane.
Whilst it was extremely busy with a normal day finishing anywhere between 11 pm – 1 am and back in the office at 7.30am the next day. It was the greatest learning curve for me and something I still use today. There is no such thing as working 9 -5, five days a week. This is especially true for founders, you finish work when the work is finished.
I still distinctly remember black Monday, Monday 19th October 1987, when our markets fell by 40% in one day! To be fair, I was still new to the game, and didn’t really understand what had happened, but I soon came to learn what a real bear market felt like. Essentially years of a boring market moving sideways and the whole industry losing its energy and spark. Back to the boring 9–5 days, something I wasn’t used to.
From stockbroking, I moved into a back office settlement system software sales role which still kept me closely aligned with the industry and an experience I truly enjoyed for many years. But the markets kept calling me back, and since my stint in software, I have worked at, managed, and owned stockbroking businesses. Whilst the manic ’80s are long gone, it is an industry I am truly passionate about.
It’s this passion that has driven me to build Trade for Good, I am not a believer in “Greed is good”, as once so famously stated by Gordon Gekko in the 1987 hit film Wall Street, I believe that we as an industry can always do better.
As we all know, the finance industry is all about money and mostly, it's all about how much money you can I make, but with Trade for Good, we are trying to break that analogy. We say how much can I make and how much can I share with someone who can do better with it.
We share with organisations that support Humans, Animals and the Environment, and they are the superstars in this story.
When you consider someone like Foodbank can put a meal on a struggling families table for $0.50c or Carbon Positive can plant trees to regenerate our natural forests for $4, it doesn’t take much trading to make a real difference, and that is what we are striving to do.
Tell us what your company does?
Trade for Good is the first-ever ASX trading platform for all types of investors that has been built from the ground up to have a social impact.
We do this by sharing 50% of our fees (Brokerage) after costs with one of our 14 partner charities that the investor has chosen.
This is a sustainable and cost-effective way for charities to raise money, and the end investor gets to donate to these great causes at no extra cost to them.
How did you come up with the idea?
Coming up with the name was simple, we offer online trading and it will do good. So Trade for Good was a no brainer.
Over my career, I’ve been to many charity events where they raise money to help people or situations. You’re always being asked to dig into your pocket and give money on one-off bases.
This one-off model and reliance on face-to-face type fundraising has worked in the past, but is not a sustainable model, as we saw during COVID.
So, I came up with the idea of how to incorporate what I know from the broking model, and make it a vehicle that can drive a social impact by raising money for charities in a sustainable, cost-effective way.
Sharing brokerage is a common model within stockbroking. For example, if I am a stockbroker with clients at a stockbroking firm, I will pay somewhere between 40 - 60% of all my brokerage to the firm.
With retail online trading, or self-directed trading like CommSec, nothing is shared, everything goes to the bottom line of the business. More recently, we have seen the introduction of ultra-low-cost brokers, where revenue margins are so minute they couldn’t share it even if they wanted to. It appears they’re most interested in building a database of clients than building a sustainable business model.
So, we modified the sharing model and split our revenue and shared 50% with non-for-profits across Humans, Animals and the Environment.
How did you go about building and launching the business?
Our ethos for trading has been, if it’s not broken, don’t fix it. Let’s use what already works and make it work for us. We knew from the start to use brokers and software that are the industry standard and that have universal connectivity so that everyone can use our service.
First was the business name, and that was easy as it speaks for itself. Then there was the brand, logo, look and feel of how we wanted Trade for Good represented. We learnt quickly that we are good at online trading, so to express who we are and what we do, we needed professional help. When the branding agency took us through this journey of understanding what the brand meant to us and came up with our current brand and colour template, which we love.
Then we had to establish a core foundation of partner charities, ones that meant something to us and or our families and friends. This is easier said than done when there are 58,000 registered charities in Australia.
We started trading with friends and family to prove the concept whilst we worked on that cornerstone list of charities. If I’m honest, this process probably put us back 6–8 months from where I thought we would be. We fully expected the charities to get behind us and promote us via their databases, as they would benefit, but that didn’t happen.
From there, we have grown our client base from retail traders to now also include institutional clients as well.
How have you grown the business?
It has been slow, the competitors are very well-funded and offer ultra-low-cost models (which doesn’t work for anyone), so the growth on our retail side has been slow, but our competitor’s growth is pigeonholed to retail customers only. We are lucky we can offer our model to a broad range of investors, from mums and dads to fund managers, family offices, wealth managers and industry super funds.
At the start of 2022, we embarked on an advertising campaign that included TV and social media, but we lacked the resources for it to be an ongoing campaign. But saying that, the targeting was great on the campaign for brand awareness in the finance industry but lacked when it came to new retail sign-ups.
What's your biggest selling product/service?
Our biggest selling point is that you’ll get an excellent trading service, and it will generate something good, an ethical impact.
The great thing about what we do is it doesn’t matter the size of the trade it still can have a big impact when you consider some of our partners, like Foodbank, who can create a meal for $0.50c. Carbon Positive Australia can plant a tree for reforestation of our national bush for $4 per tree. Take3 for the Sea can educate a child about the dangers of plastics and our oceans for $4.50.
We are the only trading firm in Australia, and from what I have researched, the world, who donates to charity on every single trade every single day.
What have been some of your biggest failures along the way?
The biggest lesson we have learnt is that if you want to play in the retail space, you must be very well-funded to allow you to roll out a substantial multi-year advertising campaign. What we’ve also learnt is to pivot. If plan A doesn’t work, try plan B, where there’s a better chance of finding a client base that will want your service.
What's next for you and your business?
What’s exciting for us is adding international markets to our trading. Soon we will be able to trade in the US, UK, Hong Kong, China, France and German markets. From there, we will also be adding new ways for people to use Trade for Good.
The current focus is organic growth through the B2B side of our business and partnering with progressive firms who are willing to take costs such as trading and turn them into a positive impact through what we do.
We are currently working with some great names and will be excited to announce them in the near future.
What digital tools do you use regularly?
Our main tech stack outside of our trading tools are:
Zoom (of course),
Mailchimp for our newsletter,
LinkedIn (lots of connections and leads through there),
Asana to keep track of projects and tasks,
and Pipedrive for our client CRM.
What books have been a great inspiration to you as a founder?
and 1,000 True Fans by Kevin Kelly
Any quotes you live by?
"“Perseverance is not a long race; it is many short races one after the other.”– Walter Elliot
What do you love and hate about being a founder?
I love trying to help others through what we do and seeing how even just a little can still have a massive impact.
I hate stressing over capital.
What do you do to look after your mental health as a founder?
Take patchy (my dog) for a walk and listen to music. Rant and rave to my co-founder in the office.
In a few words, sum up what it means to be the founder of a business
"Highs, lows, loves and hates and a sense of achievement."
What are the biggest pieces of advice you’d give to other founders?
"Make sure you are well funded, and be patient. Have the right team around you, and don’t expect everyone to like what you do, but keep working, and you will find your niche audience."