When it comes to raising capital, there are no friends like new friends.
Online discretionary money manager Nutmeg announced that it had raised $32 million in funding from a group of new shareholders. The capital takes Nutmeg’s total funding to $50 million.
Participating in the funding round were Charles Dunstone (founder of Carphone Warehouse); international asset-management company Schroders; and Balderton Capital, a venture capital firm. Nutmeg plans to use the additional capital to develop new products and improve services.
Nick Hungerford, co-founder and CEO, pointed to its low-cost, security, transparency, and convenience as complements to what he called Nutmeg’s “brilliant portfolio management.” Nutmeg’s technology helps users reach their goals through more efficient savings and investment. By factoring in risk, contribution levels, time-to-target, and other conditions, Nutmeg provides a realistic, objective source of sound money-management.
Users of the platform pay a management fee between 0.3% and 1% of total invested. According to Nutmeg, this can be a significant savings compared to the average management fee for private clients of 1.36%. The minimum investment size is £1,000, and accounts with less than £5,000 are asked to provide a minimum £50/month contribution.
Nutmeg’s investment strategy is based on diversification of risk and opportunity and relies on exchange-traded funds (ETFs) to make targeted, low-cost investments. The company provides personalized portfolio management and periodic review, as well, including regular rebalancing.
Nutmeg has more than 35,000 users. The company picked up an award at the 2014 European Fintech 50 in January, and its CEO was named to FN’s 40 fintech leaders list earlier this month.
Winner of a Best of Show Award at FinovateEurope 2012, Nutmeg, founded in 2011, is based in London.