For us, user experience has always been the necessary condition. Complexity is the sufficient one — and no one but Vivid could deliver it.
Chris Puellen, Co-Founder & CEO, NaroIQ
In November 2023, NaroIQ closed a three-million-euro funding round. Just months earlier, Silicon Valley Bank had collapsed; treasury management had suddenly become a live topic for early-stage startups across Europe. Germany's statutory deposit insurance covers up to €100,000 per bank. “If you leave three million euros sitting at one bank and it goes under tomorrow, then 2.9 million euros are simply gone,” says Chris Puellen, Co-Founder and CEO. For a team that has thought in regulated structures since day one, the conclusion was clear: with the capital came the responsibility to manage it professionally.
NaroIQ operates from Cologne in a complex regulatory structure — the parent company NaroIQ GmbH is registered as a financial intermediary; the two subsidiaries, NaroIX GmbH (benchmark administrator under EU Regulation 2016/1011) and NaroAM GmbH (investment firm under WpIG), are supervised by BaFin. Complexity is part of the business model. What shouldn't be part of the business model: a team manually moving money between dozens of accounts every month to stay under deposit-insurance thresholds.
The missing tenth
What NaroIQ builds can be described in one sentence. “NaroIQ is a technology company that helps fund providers enter the ETF market,” Chris explains. When you buy ETFs, you buy exchange-traded, second-by-second-priced fund shares, instead of the once-daily priced mutual funds that have shaped the European savings market for decades. For the large asset managers who today manage billions in classical funds, migrating to the ETF world is a technological feat: exchange interfaces, real-time market surveillance, regulatory reporting on a different cadence.
The current market standard forces these providers to hand over their entire value chain — pre-bookkeeping, risk management, ESG reporting, regulatory filing, custodian, portfolio management — to an external ETF service provider. Chris frames the counter-thesis precisely:
There are very, very many providers who already have 90 percent of this fund puzzle in place. But these 10 percent are missing for them. Until now there are only providers who say: well, then you have to buy the complete puzzle from us. So why can't they just buy the 10 percent they're missing?
Chris Puellen, Co-Founder & CEO, NaroIQ
Those who work with NaroIQ keep the first nine pieces of the puzzle in-house — and buy only the tenth. The company is currently onboarding clients seven and eight.
Why ETFs are the future
Market observers watching the growth of ETFs against classical funds know the curves. Chris explains them with an image that sounds less like finance and more like media habits. “You want to watch the movie on Netflix right away, instead of waiting Sunday evening for the Tatort. You want to listen to the song on Spotify immediately, instead of waiting for the CD. You want to book the flight immediately, instead of going to a travel agency.”
What has long been standard for the platform economy is now reaching the world of capital-market products. “Funds get a price only once a day. ETFs get a price every second, and are therefore simply much more attractive, have a much better user experience, and are gaining more and more growth and potential.”
NaroIQ helps providers still operating in the once-a-day mode transition to second-by-second pricing.
A different bet
Today's strategy wasn't the first. Chris and his co-founder have known each other for ten years. What they wanted to do together has evolved over the years — what drove them has not: “To deliver lower fees and more innovation in the financial industry overall.”
The original vision was more direct. “The original vision of NaroIQ was, back then, to build a European Vanguard.” Inspired by the cooperative model of the American original — which returns profits to customers through fee reductions — the founders saw an opportunity in the European gap. As they advanced the early build phase, a different conviction took hold: those who want to change the market faster help the established players move it themselves. “So why should we build it ourselves if we can just help the existing brands make this transition?”
The retail dream became an infrastructure bet: equip the same asset managers who today manage mutual funds with the technology with which they can issue ETFs tomorrow.
That way we probably haven't created an absolutely perfect world, but at least a relatively better one.
Chris Puellen, Co-Founder & CEO, NaroIQ
Three rounds, seven clients
“The early days of NaroIQ were very chaotic,” Chris recalls — a phase nearly every startup goes through. The vision became a corporate structure with three companies. Three funding rounds carried NaroIQ from first concept to today's Cologne-based regulated company: roughly €500,000 in pre-seed, three million euros in November 2023, eighteen months later another €6.5 million — approximately €10 million in equity capital in total. Investors who believe in the European ETF-infrastructure thesis have backed the build at every stage.
Two founders became a team. One idea became two BaFin-regulated subsidiaries. In the onboarding pipeline today sit clients seven and eight — market position that translates the ten-year partnership into concrete business relationships.
What makes this trajectory possible, Chris describes plainly: “The skills you need to acquire are a high level of energy, discipline — in English you'd say: grit and a lot of passion. Those are the decisive factors. I don't believe you can be very good at something you don't feel anything for.” From this drive, NaroIQ has grown into a platform that doesn't watch the market from a distance — it is part of the market's transformation.
€120,000 more runway
With the Series A in November 2023, the treasury responsibility grew with it. “We were looking for a solution where you could invest three million euros,” Chris explains. The options came down to two. Option one: spread the money across roughly 30 banks to stay under the €100,000 deposit-insurance ceiling per bank — operationally a significant overhead of onboardings, balance-sheet items, and manual transfers before every payday. Option two: a single financial partner capable of meeting the demands of a regulated company with subsidiaries — and at the same time delivering the digital user experience NaroIQ expects as a tech firm.
“So it was clear for us: there are two options. Either I split my money across 30 banks, or I move my money to Vivid and invest it there. And that was a very simple decision.”
From Vivid's offering, NaroIQ today primarily uses the Model Portfolios and the Interest Account. Both reflect money-market funds holding, among other things, German and French government bonds. “The legal term for that is a fund as Sondervermögen,” Chris explains. The construction is legally segregated from the assets of the issuing provider — a property of fund structures well known to institutional investors.
The math of cash management is trivial and significant in equal measure. Chris sums up the impact in a single figure: “Three million euros that we raised in one round and then placed at three to four percent — that's 120,000 euros a year. That's a lot of money. That's one or two extra months of time to build the product, if you do smart cash management.” Eighteen months after the first round, NaroIQ raised another €6.5 million. The same logic with a bigger lever. “Many founders still underestimate how important cash management is, because good cash management really brings you a lot of time.”
A good finance function is one that doesn't occupy you.
Kendrick, VP Risk, NaroIQ
Beyond the math is what Chris calls the real pain: not the money, but the mindspace. “You have to build a company, build a product, sell a product — and then on April 25 you still have to think about moving money from one account to another. Not because there isn't enough, but simply because there shouldn't be too much on one account, and not too much on the other either.”
For a growing regulated company that has to carry regulatory complexity and hold tech speed at the same time, that's the operational definition of what a modern financial platform should deliver: several accounts in one structure, a US dollar account for foreign invoices, investment products for liquidity not yet being spent — and all of it set up through one onboarding that doesn't tie up the Compliance and Finance function for days.
What comes next
Today, NaroIQ is building the infrastructure for the providers who, ten years from now, will issue ETFs that don't yet exist — “things I would have dreamed of three years ago.”
Past performance is not a reliable indicator of future results. This article does not constitute investment advice.
