Divizend Suisse: The Venture Leader Fintech developing solutions for dividend investments and related tax issues

10.11.2023 10:30, Rita Longobardi

Meet Thomas Rappold, CEO of Divizend. The startup offers innovative software that automates the process of reclaiming foreign withholding tax on dividends, providing a novel, customer-centric, and competitively priced service through an intuitive dashboard.

Name: Thomas Rappold
Location: Munich (Germany) and Weinfelden (Thurgau)
Nationality: Germany
Graduated from: University of Applied Sciences Furtwangen
Job title: CEO and Co-Founder
Number of employees: 20
Money raised: CHF 1,5 million


 

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Can you tell us who your product or solution helps, and how?
We have a simple but powerful mission statement: "We help investors maximize their dividend returns." Whenever investors hold foreign dividend stocks in their portfolio, they are subject to double taxation through withholding tax and income tax. This reduces their dividend income and, consequently, their investment yield significantly. As more and more investors buy foreign stocks and the topic of dividend investment becomes increasingly popular, this poses a major problem. Divizend Suisse has now become the first fintech worldwide to develop a simple browser-based solution that enables all customer groups, whether individual investors, private banks, asset managers, family offices, and funds, to quickly and uncomplicatedly reclaim foreign withholding taxes.

What market are you addressing and what is the potential of your startup in that market?
The global dividend market has a volume of USD 1.5 trillion and is growing at rates of 5-10% per year. It is one of the largest markets in the financial sector overall. The worldwide market for withholding taxes amounts to around USD 100 billion. Very exciting in our context: More than USD 20 billion in withholding taxes annually go unreclaimed. With our customer-centric platform and revolutionary approach, we aim to secure a significant piece of the pie.

How and where did you come up with the idea for your startup?
A C-suite of a very well-known international major bank once told me: "Divizend is among the few fintech companies that solve a real customer problem." The strongest business cases always come from founders who face a problem and want to solve it. That's exactly how it was for me. I am an investment advisor and stock expert with international stock portfolios and I had to deal with withholding tax. I was looking for a smart solution that I couldn't find, so I took it upon myself to solve the problem. In the meantime, this has evolved into a very successful fintech called Divizend Suisse.

What do you expect from the Venture Leaders Fintech roadshow, and how will it help you achieve your vision?
Firstly, it is a great honour for us to be a part of this. In Switzerland, fintech holds a higher significance than in the EU. After being among the top ten fintech at the Swiss fintech Award by FuW earlier this year, this is further evidence of the high acceptance of Divizend Suisse in Switzerland. The week-long roadshow in London will assist us in entering this new attractive market. The timing is perfect for us as we have recently filled the position of Head of UK at Divizend and now aim to establish ourselves in the UK. Ultimately, the city of London represents the financial centre in Europe.
 

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What are your team’s key achievements to date?
The biggest achievement is certainly that we have completely bootstrapped something from scratch, starting on a blank piece of paper. Since day one, our vision has been simple: connect your securities account to our platform, and we'll handle the rest for you. We have not only achieved this technically, which was a significant challenge, but, more importantly, it has gained remarkably high customer acceptance.

Is there a key principle or value that guides you as you build your company?
My great role model is Berkshire Hathaway, and thus the two entrepreneurs Warren Buffett and Charlie Munger. They have embodied true values over more than 60 years. For us, Divizend is initially a passion, and in the second step, it's about making money with it. We love what we do, similar to Buffett and Munger. Unfortunately, many in the financial and fintech community are primarily driven by money, seeking the next big thing that promises them quick returns. Our business plan for Divizend is very long-term and sustainable, and we hope to add many more chapters.

What is the most important lesson you have learned as a founder?
Staying true to one's principles and always trying to be in the driver's seat oneself. Financial independence is a high value in this regard. Being able to decide opportunistically for oneself what needs to be done without having to ask anyone whether this or that is right.

What is your favourite productivity hack/tool and why?
Returning to Buffett and Munger, both avid readers like myself, they share a keen interest in a wide range of topics. I enjoy reading books, newspapers, and magazines in print rather than online. Given that most people now navigate exclusively online, this preference provides me with many exciting advantages.

What was your dream job when you were a child?
My childhood dream job was to be a locomotive driver. My passion for model trains has been a constant since my early years, particularly with locomotives from Burlington Northern, the railway company now owned by Berkshire Hathaway and Buffett.

Do you recommend a podcast you want to share with us?
I can't recommend any podcasts because I don't listen to them myself. As a fast and avid reader, podcasts impede my progress as they tend to be too slow for my liking. I believe genuine reading sharpens the brain more effectively than listening.

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ABOUT THE PROGRAM
The Venture Leaders Fintech 2023 were chosen from over 60 applications by an expert jury. The roadshow in London will accelerate their ventures’ growth and expand their international presence. Venture Leaders Fintech is organized in partnership with Swissnex, and supported by EPFL, ETH Zürich, Postfinance, and Walder Wyss.