Blooom: Fighting Fraud in the World of the 401(k)

If the idea of a hacker getting access to your bank account is scary, imagine learning that a cybercriminal has hacked into your 401(k).

That’s the kind of anxiety independent robo advisor blooom is guarding against with the introduction of its new Suspicious Activity Alerts feature. The technology continuously monitors user’s 401(k), 403(b), and similar employer-sponsored retirements accounts for withdrawals or loans. If suspicious activity is detected, the solution sends the customer an alert by text message.

“The 401(k) is often a person’s single largest financial asset,” blooom CEO and co-founder Chris Costello said. “bloom is committed to safeguarding your right to retire. Whether it’s exposing and minimizing hidden investment fees or identifying suspicious activity, blooom serves one person: the individual.”

Founded in 2013, blooom demonstrated its robo advisory platform at FinovateFall 2014. Geared specifically for the employer-sponsored retirement market, Blooom provides free 401(k) analysis and charges a flat fee of $10 a month for basic 401(k) management and monitoring – including the Suspicious Activity Alerts feature. Additional 401(k)s can be added for $7.50 per month. Blooom automatically rebalances and adjusts the investment allocation based on the user’s general investment preferences (i.e., stock vs. bond mix) and goals (i.e., time-until-retirement). The company also offers access to human financial professionals to provide planning advice beyond the 401(k).

Blooom’s approach seems to be working. The company announced last fall that it surpassed the $1 billion assets under management milestone, doing so faster than any other independent robo advisor including both Betterment and Wealthfront. In a blog post discussing the milestone, Costello pointed to the application of readily available technology to the often-overlooked world of employer-sponsored retirement accounts as key to blooom’s growth and success.

“There has been ‘off-the-shelf’ technology that has existed for upwards of 10 years that can automate things like the construction of a portfolio allocation, rebalancing a portfolio, and even tax-loss harvesting,” Costello wrote. “But nothing existed to perform this kind of automation when it comes to the 401(k) space – where accounts are spread out over dozens and dozens of different financial institutions. Until now.”

With more than $13 million in total funding, blooom includes QED Investors, Industry Ventures, Commerce Ventures, Allianz Life Insurance, TTV Capital, and Nationwide Insurance among its investors. The company is based in Overland Park, Kansas.

Finovate Alumni News

On Finovate.com

  • Blooom: Fighting Fraud in the World of the 401(k).

Around the web

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This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Blooom Surpasses $1 Billion in Assets Under Management

Wealth tech company Blooom announced this week that it has surpassed the $1 billion assets under management milestone.

The Kansas-based company manages employer-sponsored 401(k) and 403bs for “thousands of clients” across the U.S. This comes just 16 months after the company announced it surpassed the $300 million assets under management milestone.

In a blog post, Blooom’s CEO Chris Costello made a point to express the speed at which the company arrived at this milestone. “We also take pride that this Kansas-based company reached the milestone faster than both Betterment or Weathfront – while doing so on a fraction of the capital,” Costello said. He added that he uses these competitors’ achievements to benchmark the company’s own.

Chris Costello, along with the company’s CTO and co-founderRandy AufDerHeide, demoed Blooom at FinovateFall 2014. The company differentiates itself by sticking to its three principles: no more jargon; transparent and fair pricing; and stability and values. The company has raised a total of $13.2 million in funding and was recently featured as one of 10 Kansas City startups to watch in 2017.

Finovate Alumni News

On Finovate.com

  • Blooom Surpasses $1 Billion in Assets Under Management.

Around the web

  • Yelp Partners with TrueAccord to Deliver Digital Collections and Streamline Data Loop for Customer Engagement.
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This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Top Direct-to-Consumer Wealthtech Plays

wealthtech4

Our wealthtech industry coverage continues this week. We looked at the industry last week and reviewed the top trends earlier this month. Today we’re taking a look at industry players with B2C offerings—in other words, companies that market directly to consumers and not through businesses.

Since wealthtech is broader than just roboadvisers, we’ve divided B2C wealthtech players into seven categories and laid out our top picks for each group. Since category sizes vary, the number of our selections also vary.

Top in-house builds from traditional players
These are offerings from traditional wealth management firms that have been built in-house (or purchased and then white-labeled) and marketed under the firm’s brand.

Fully automated roboadvisers
These are online platforms that provide automated, algorithm-based portfolio management without intervention from human advisers and without personalized, one-on-one conversations with a human adviser.

screen-shot-2016-12-22-at-4-06-40-pmAcorns takes a unique approach by linking a user’s debit card and investing their “spare change”

Hybrid roboadvisers
These are traditional advisory services, including personalized conversations and actively managed portfolios blended with computerized portfolio recommendations. Business Insider reports hybrid roboadvisers will manage 10% of all investable assets by 2025.

screen-shot-2016-12-22-at-4-11-08-pmSigFig has partnered with multiple banks, including Wells Fargo, Pershing, and Citizens Bank

Non-U.S. roboadvisers

Alternative investing platforms
These are platforms that link participants to unconventional investment types, such as private equity, hedge funds, futures, real estate, etc.

screen-shot-2016-12-22-at-4-18-08-pmWith Motif, uses invest in grouped stocks and ETFs that revolve around a common theme

Non-U.S. alternative investing platforms

News and information companies
These are online platforms that help users discover news and market trends before they go mainstream. Some include social networking aspects.

screen-shot-2016-12-22-at-4-23-47-pmTickerTags helps users discover trends even before they become news

Finovate Alumni News

On Finovate.com

  • Check out this week’s FinDEVr APIntelligence.
  • BizEquity Forges Strategic Partnership with Sawtooth Solutions

Around the web

  • Thomson Reuters unveils its KYC due-diligence solution, Org ID.
  • Jack Henry Banking has “refreshed”  its SilverLake Systems core banking solution.
  • Lloyds Banking Group renews processing agreement with TSYS.
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  • 2016 Gartner Market Guide for Customer Journey Analytics lists GMC Software as a representative vendor.
  • Lendio to participate in small business lending disclosure, SMART (Straightforward Metrics Around Rate and Total cost) Box initiative.
  • D3 Banking wins Depth of Service Award in vendor analysis report from Celent.
  • Encentus FCU to deploy core account processing technology from Fiserv.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Finovate Alumni News

On Finovate.com

  • GBG Group Agrees to Acquire IDScan Biometrics
  • Check out this week’s FinDEVr APIntelligence.
  • Kreditech Launches Online POS Financing Solution
  • Fenergo Adds Enhanced Rules, Remediation to its CRS Compliance Solution
  • From CEO to Deputy Mayor, Xendpay’s Rajesh Agrawal Heads to City Hall

Around the web

  • The Paypers interviews ACI Worldwide’s Craig Saks, group president of strategic products.
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  • PYMNTS.com chats with Jeff Hampton, TSYS director of product marketing.
  • Greg Smith, Blooom president; Aaron David Bauer, Envestnet Executive MD; and Andy Swan of LikeFolio earn spots on Investment News’ 40 Under 40 list.
  • Matt Fellowes resigns as chief innovation officer at Morningstar—which bought HelloWallet in 2014—to build retirement software.
  • ID Analytics secures patent for systematic detection of fraud rings.
  • Fenergo enhances CRS compliance solution with enhanced rules and remediation.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Robo-advisor blooom Reaches $300 Million in Assets

blooom_homepage_June2016

Mirror, mirror, on the wall. Which robo-advisor is the fastest growing one of all?

According to monthly SEC filings, no independent robo-advisor had made it to $300 million in assets managed faster than blooom. That the company reached this milestone 20 months after launching—and with less than a fifth of the outside capital raised by its competitors—is all the more impressive. “Most of our growth has been organic, through word of mouth, because our clients—everyday, regular Americans in all 50 states—see how meaningfully we can improve their 401(k)s, cut their hidden fees, and potentially add years in retirement,” said bloom CEO Chris Costello, co-founder.

Blooom_stage_FF2014c

From left: Co-founders Chris Costello and Randy AufDerHeide demonstrated the blooom platform at FinovateFall 2014 in New York.

Founded in 2013 and headquartered in Overland Park, Kansas, blooom demonstrated its technology at FinovateFall 2014, picking up a Best of Show award. The company distinguishes itself from the rest of the robo-advisor pack by focusing on helping investors manage their 401(k)s and other employee-sponsored, defined-contribution pension plans. The platform makes suggestions on asset allocation and portfolio building and steers investors toward lower-cost index funds when practical. For subscribers, the service automatically reviews the portfolio every 90 days to make sure allocations remain in balance and will reduce stock exposure as investors near retirement age. The platform provides free portfolio analysis, and charges $5 a month for accounts under $20,000; $19 a month for accounts between $20,000 and $49,999, and $99 a month for accounts above $500,000.

The company has raised $4 million in funding and includes QED Investors, Commerce Ventures, DST Systems, Gibraltar Ventures, Hyde Park Venture Partners, and UMB Banks among its investors. Named “one in a million” in the Kauffamn Foundation Startup competition last fall, blooom was honored by Employee Benefits News as a Top 50 Benefit Technology Innovator in April. And in March, NPR profiled the robo-advisor as part of a feature on how to help millennials plan for their financial futures when dealing with student debt. Read our Finovate Debut feature on blooom.

Post updated to reflect Blooom’s new pricing.

Finovate Alumni News

On Finovate.com

  • “Robo-advisor Blooom Reaches $300 Million in Assets”
  • “Finovate Alums Earn Top Honors at 2016 Benzinga Fintech Awards”
  • “Finovate Debuts: Fintonic’s Mobile Banking Offers Products that Matter”
  • “NYMBUS Acquires R. C. Olmstead to Enhance Core Data Processing”
  • “Dashlane Unveils Redesigned App for iPhone and iPad”

On FinDEVr.com

  • “Praesidio Rebrands as DefenseStorm”

Around the web

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  • “Fragmob and CardFlight Announce Integrated Partnership”
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This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account

Finovate Alumni News

Around the web

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  • PaySimple teams up with Fundera, a small-business-lending marketplace.=
  • Xero and Expensify form partnership.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.