Automated investing service Betterment has closed a USD60 million round of growth funding led by private equity firm Francisco Partners.
Previous investors Bessemer Venture Partners, Menlo Ventures, and Northwestern Mutual Capital alos particpated.
“Our growth has continued to accelerate,” says Jon Stein, Betterment Founder and CEO. “More people are becoming Betterment customers every day, and our existing customers continue to invest more with us. This new capital will allow us to grow even faster and increase the development of new products that will continue to reinvent investing around what customers want: a seamless, personalised experience that is aligned with their best interest and optimised for the highest expected returns net of all costs.”
Launched in 2010, Betterment manages more than USD1.4B of assets in tax-efficient, personalised portfolios for more than 65,000 customers, by far the largest customer base of any automated investing service. The company offers a seamless, technology-enabled platform that helps people better manage, protect, and grow their wealth.
“We’ve created a new product category over the last five years,” says Stein. “While we’re excited with where we are today, we’re really just getting started. There are millions of people in need of better financial advice and services, and we're building the smartest technology and making it accessible to anyone.”
In addition to raising the new round of funding, Betterment is welcoming Peter Christodoulo of Francisco Partners to its Board of Directors. Francisco Partners brings significant experience in financial technology, with previous investments that include Prosper Marketplace, eFront, PayLease, Paymetric, Avangate and Hypercom among others.
“We have long felt that the wealth management space was overdue for a solution that could better serve the majority of Americans through smarter technology,” Christodoulo says. “Betterment’s unique, vertically integrated architecture allows its platform to be lightning fast, which is proving to be compelling with customers as thousands fund new accounts each month.”
In the past year, Betterment has unveiled a variety of new features to help improve investor returns, including Tax Loss Harvesting+TM and Tax Impact Preview. The company also recently unveiled Betterment Institutional, a digital solution that allows financial advisors to better serve their clients and make their practices more efficient.
