New Financing Follows Year of Rapid Growth
Betterment, the largest independent robo-advisor, today announced a $100 million Series E round of funding. Swedish investment company Kinnevik led the financing, which includes participation from previous investors Bessemer Venture Partners, Anthemis Group, Menlo Ventures and Francisco Partners.
Over the past 15 months, Betterment has grown from managing $1.1 billion to now nearly $4 billion in assets for more than 150,000 customers. The growth has been driven by a significant increase in the customer base, existing customers investing more, and the launches of Betterment Institutional for advisors and Betterment for Business 401(k) for employers. The financing will enable Betterment to aggressively grow its business and increase product development.
“Our goal is to become the central financial relationship for our clients,” said Jon Stein, Founder and CEO of Betterment. “Over the past year, we’ve made great progress toward that goal with features like RetireGuide and account aggregation, but there is still work to do. It’s the early days for us on our path to helping millions of Americans reach their financial goals.”
“Kinnevik shares our vision of building a technology-driven financial services company that customers love,” Stein added. “From our first meeting, it was clear that we shared the same values of what a modern day financial company would look like.”
“Betterment is a fast-growing, independent company that has already established itself as a market leader in digital asset management by developing innovative and easy-to-use services,” said Lorenzo Grabau, CEO of Kinnevik. “In a short period of time, it has attracted a large and loyal group of customers who are investing a growing share of their wealth through the Betterment platform.”
“We are delighted to partner with Jon Stein and Eli Broverman, with Betterment’s entire team and with its existing investors to support the company’s long-term growth,” added Grabau. “Betterment shares many of the principles that have made other Kinnevik investment companies successful: a mission to make valuable digital services available and affordable to all, a true entrepreneurial spirit, the pursuit of continuous technical innovation, and a belief in building customer-centric businesses that contribute to their communities. Everyone should have access to unconflicted and low-cost financial services that enable them to reach their financial goals.”
Betterment offers its customers a globally diversified portfolio of index-tracking exchange-traded funds (ETFs) with personalized advice in a goal-based investing framework. Customers can open and customize regular investment accounts, traditional/SEP/Roth IRAs, trust accounts, and accounts for retirement income. Betterment also has expanded its platform to serve the RIA and 401(k) markets. For more information, please visit www.Betterment.com.
ABOUT BETTERMENT
Betterment leverages its proprietary software and vertically-integrated technology platform to help retail investors better manage, protect, and grow their wealth, all at a much lower cost than traditional asset managers. The Company’s algorithms automatically invest a customer’s assets across a portfolio of exchange traded funds (ETFs), rebalances investor portfolios, reinvests dividends, and drives ongoing tax loss harvesting to optimize long-term returns. Founded in 2008, the Company has more than 65,000 customers investing over $1.4 billion of assets on the platform.