Frec
- Company typePrivate
- Founded2023
- HeadquartersSan Francisco, United States
- Headcount11–50
- GTM typeB2C
- OfferingSoftware
Frec firmographics
Firmographics- Name
- Frec
- Legal name
- Frec Markets, Inc.
- Website
- https://frec.com
- Company type
- Private
- Founded year
- 2023
- Operating status
- Operating
- Headcount range
- 11–50 employees
- Ownership category
- akta.pro rank
Frec industry classification
Industry- Product category
- Direct Indexing Platform
- NAICS
- Portfolio Management and Investment Advice (523940), Securities, Commodity Contracts, and Other Financial Investments and Related Activities (523)
- SIC
- Investment Advice (6282), Security Brokers, Dealers & Flotation Companies (6211)
- akta.pro primary industry
- Execution-Only / Self-Directed Investing Platforms (FSAAAAAI)
Keywords
Where Frec is headquartered
LocationHeadquarters
- HQ city
- San Francisco
- HQ country
- United States
- HQ region
- North America
Offices1 record
Markets served
Frec business model
Business model- GTM type
- B2C
- Offering type
- Software
- Cost components
- Technology or R&D, Personnel, Operations, Marketing or Sales, Infrastructure
Revenue model
- Asset Under Management (AUM) Fees: Charges an annual percentage fee on assets under management. Fees range from 0.09% for S&P 500 to 0.35% for other indices. The platform manages over $1B in assets.
- Portfolio Line of Credit Interest: Generates interest income from portfolio line of credit facilities offered to customers. Rate is Effective Federal Funds rate plus 1%, currently 4.64% APY.
- Treasury Yield Spread: Earns yield on customer cash held in treasury accounts while paying customers a portion of the yield (currently 3.34% to 4.64%).
Pricing tiers
| Model | Billing | Price |
|---|---|---|
| Subscription | Annual | S&P 500 Direct Indexing - 0.09% AUM fee |
| Subscription | Annual | CRSP US Large Cap - 0.10% AUM fee |
| Subscription | Annual | CRSP Total Market - 0.13% AUM fee |
| Subscription | Annual | CRSP Mid Cap - 0.14% AUM fee |
| Subscription | Annual | CRSP Small Cap - 0.15% AUM fee |
| Subscription | Annual | Russell 1000 - 0.22% AUM fee |
| Subscription | Annual | Russell 2000 - 0.26% AUM fee |
| Subscription | Annual | Russell 3000 - 0.27% AUM fee |
| Subscription | Annual | Long Short Direct Indexing - Up to 2.725% total fee |
| Usage-based | Pay-as-you-go | Portfolio Line of Credit - Fed rate + 1% |
| Usage-based | Pay-as-you-go | Frec Treasury - 3.34% to 4.64% yield |
Go-to-market motion2 records
Distribution channels5 records
Marketing channels6 records
Frec product offering
Product offeringCore offering
Frec operates a self-service direct indexing platform that purchases individual stocks of market indices (such as the S&P 500, CRSP, and Russell indices) on behalf of retail investors instead of holding ETF shares, enabling daily automated tax-loss harvesting to offset capital gains. The offering is delivered as a digital product with no human advisor required, complemented by treasury cash management, a portfolio line of credit, concentrated-stock diversification, and a self-directed trading module.
Product overview
Frec is a financial technology platform offering automated direct indexing investment products for retail investors. The core product is Frec Direct Indexing, which enables tax-efficient market investing by purchasing individual stocks of indices (S&P 500, Russell, CRSP, MSCI) and harvesting daily tax losses. The platform offers a modular architecture: the core direct indexing engine supports 25 index options with customization (exclude stocks/sectors, manage dividends), complemented by add-on products including Long Short Direct Indexing for enhanced returns, Frec Diversify for tax-aware stock diversification, a Portfolio Line of Credit for low-rate borrowing against holdings, Frec Treasury for earning yield on idle cash, and Frec Trade for self-directed trading. All products are self-service through a modern digital platform with no human advisor required, and funds are held at third-party custodian Apex Clearing.
Differentiator
Problem solved
Functional benefit
Brands
- Frec Direct Indexing: Tax-aware direct indexing platform that tracks S&P indices and offers automated tax-loss harvesting for retail investors
- Frec Treasury
- Long Short Direct Indexing
- Frec Diversify
- Portfolio Line of Credit
- Frec Trade
Products and services
- Frec Direct Indexing Automated direct indexing platform that purchases the individual stocks of an index (e.g., S&P 500) instead of ETF shares, enabling daily tax-loss harvesting to generate capital losses that offset capital gains and reduce tax liability for retail investors.
- Long Short Direct Indexing Advanced direct indexing variant combining long positions with short positions using a Quality factor tilt, formerly exclusive to hedge funds with $1M minimums, now available on Frec for retail investors seeking higher after-tax excess returns.
- Frec Diversify Feature enabling users to transition concentrated stock positions into diversified index-tracking portfolios over time while minimizing tax impact through tax-aware selling strategies.
- Portfolio Line of Credit Borrowing service allowing users to access up to 70% of their portfolio value at low interest rates (4.64% APY) without selling stocks or triggering capital gains taxes.
- Frec Treasury High-liquidity treasury account enabling users to earn yield on idle cash (3.34% as of latest reporting) by investing in low-risk US treasury mutual funds, with funds accessible anytime.
- Frec Trade Self-directed trading platform offering zero-commission stock and ETF trading with granular control over individual tax lots, market/day limit orders, real-time prices, and auto-conversion features to redirect positions to direct indices.
Quantifiable outcome
- 40% of portfolio value in tax losses harvested over 10 years
- +7 more outcomes
Companies that use Frec
Customer profileNamed customers6 records
Segments4 records
Ideal customer profiles4 records
Frec technology and API
TechnologyTechnology focussed Yes
API detail
- Has API
- No
- API docs
- API detail
Core technology
AI maturity
App detail
Integration4 records
AI capability2 records
Feature8 records
Frec partnerships and signals
Strategic signalPartnerships
Five partnerships are on record, tiered core and supporting.
- Apex ClearingcoreThird-party custodian holding customer assets. One of the largest U.S. custodians with over $200B in assets for leading fintech companies. Provides asset protection and transfer capabilities.
- PlaidcorePlaid integration enables customers to securely link bank accounts and transfer stocks from other brokerages including Robinhood, Fidelity, Vanguard, Wealthfront, Betterment, and E*Trade.
- MSCIcoreLicensed the Barra Global Total Market Equity Model for Long-Term Investors. Provides factor-based risk modeling for portfolio optimization, tracking error forecasting, and enhanced tax-loss harvesting performance.
- S&P Dow Jones IndicescoreLicensed S&P 500 and other S&P indices for direct indexing strategies. S&P 500 is a product of S&P Dow Jones Indices LLC.
- XignitesupportingLicensed dividend and split-adjusted daily stock price data from Xignite for historical backtesting and simulation analysis.
Scale indicators9 records
Expansion highlights6 records
Frec competitors and assessment
Company assessmentDirect peers
- Wealthfront: Wealthfront is a leading self-directed robo-advisor offering direct indexing, automated portfolio management, and cash management. It is the most direct competitor to Frec, serving the same retail-to-HNW segment with similar product features and fee model.
- Betterment: Betterment is a pioneer in robo-advisory offering automated investing with tax-loss harvesting, direct indexing, and goal-based planning. It directly overlaps with Frec's target customer (self-directed retail investors) and product suite.
- Parametric: Parametric is a long-standing direct indexing specialist serving HNW and institutional clients. It is one of the original direct indexing platforms and a primary competitor in the customized indexing category Frec is targeting.
- M1 Finance: M1 Finance is a self-directed investing platform offering automated portfolio management, fractional shares, and integrated banking/credit products. It overlaps with Frec on the self-directed retail investing thesis and modular product approach.
Broad incumbents
- Schwab Intelligent Portfolios: Schwab's robo-advisor offering includes tax-loss harvesting and direct indexing for retail clients. Backed by a major brokerage, it competes with Frec on price, brand trust, and asset integration within Schwab's ecosystem.
- Fidelity Wealth Management: Fidelity offers direct indexing through Fidelity Wealth Services with a 0.40% fee point. As one of the largest US brokerages, it has scale advantages Frec will struggle to match and is explicitly named as a competitor in Frec's own marketing.
- Robinhood: Robinhood is the largest US self-directed retail investing platform, offering zero-commission trading, retirement accounts, and increasingly premium products. While not focused on direct indexing, it competes for the same customer base and is a stock transfer source for Frec.
Emerging players
- Titan: Titan offers self-directed investing with active strategies and crypto exposure for retail investors. While not focused on direct indexing, it competes for the same millennial/tech-employee retail segment Frec targets.
- Stash: Stash offers self-directed investing with managed portfolios and subscription tiers for retail investors. It overlaps with Frec at the entry-level retail investor segment but does not yet offer direct indexing at the same sophistication.
Peers
- StockBond Custom Indexing by BlackRock:
Market position
Strengths5 records
Weaknesses5 records
Competitive moat6 records
Key risks6 records
Key highlights7 records
Customer concentration
Frec social profiles
Digital presenceFrec compliance and trust
Trust signalCompliance5 records
Frec financial estimates
Financial estimateRevenue estimate
Valuation estimate
Frec leadership team
Management profileNumber of profiles
Profiles1 record
Frec subsidiaries and ownership
Company hierarchySubsidiaries2 records
Frec funding detail
Funding detailFunding overview
Funding rounds2 records
Investors5 records
Funding detail is available on the Subscription and Enterprise plan.Contact sales →
Frec M&A and investment
M&A and investmentM&A
Investments
M&A and investment is available on the Subscription and Enterprise plan.Contact sales →
Frequently asked questions about Frec
What does Frec do?
Frec operates a self-service direct indexing platform that purchases individual stocks of market indices (such as the S&P 500, CRSP, and Russell indices) on behalf of retail investors instead of holding ETF shares, enabling daily automated tax-loss harvesting to offset capital gains. The offering is delivered as a digital product with no human advisor required, complemented by treasury cash management, a portfolio line of credit, concentrated-stock diversification, and a self-directed trading module.
Is Frec a public or private company?
Frec is a private company. It is classified as venture growth investor backed and is currently operating.
When was Frec founded?
Frec was founded in 2023. It employs 11 to 50 people.
Where is Frec based?
Frec is headquartered in San Francisco, United States, in the North America region.
How does Frec make money?
Three revenue lines are on record. Asset Under Management (AUM) Fees are the primary driver. The others are portfolio Line of Credit Interest and treasury Yield Spread.
Who are Frec's main competitors?
Direct peers on record are Wealthfront, Betterment, Parametric and M1 Finance. Broad incumbents are Schwab Intelligent Portfolios, Fidelity Wealth Management and Robinhood. Emerging players are Titan and Stash. StockBond Custom Indexing by BlackRock is listed as a peer.
Does Frec have an API?
No public API is recorded for Frec.
What industry is Frec in?
Frec's product category is Direct Indexing Platform. Its primary akta.pro industry code is FSAAAAAI, Execution-Only / Self-Directed Investing Platforms. Its NAICS code is 523940 and its SIC code is 6282.