Wealthtech company Betterment has boosted its total funding to $435 million after closing $160 million in growth capital this week. The funds include $60 million in Series F equity and a $100 million credit facility.
The new round values Betterment at $1.3 billion. The equity portion was led by Treasury with participation from existing investors Kinnevik, Bessemer Venture Partners, Francisco Partners, Menlo Ventures, Anthemis Group, Globespan Capital Partners, Citi Ventures, and The Private Shares Fund. New investors Aflac Ventures and ID8 Investments also participated.
The $100 million credit facility comes from ORIX Corporation USA’s Growth Capital group and Runway Growth Capital.
“We are thrilled to have the support of new and existing investors who believe in our business model and are excited by the opportunity to support our growth,” said Betterment CEO Sarah Levy. “We’re using these funds to further cement our category leadership with rapid innovation on top of our already differentiated product suite and unique, multi-pronged distribution model that serves retail investors, advisors and small businesses.”
More specifically, Betterment will use the funds to support its 401(k) offering for small and medium sized businesses.
Founded in 2010, Betterment manages $32 billion in assets for its nearly 700,000 clients. In addition to offering automated 401(k) and IRA options, the company also provides socially responsible investment options, retirement planning services, a checking account, and a high-yield savings account.
Today’s announcement comes after a flurry of news activity for Betterment, after the company appointed Levy as CEO in December of last year. In March, the company acquired the investment advisory business of WealthSimple, partnered with Zenefits to offer 401(k) plans on the Zenefits platform, rolled out a checking account for shared finances, unveiled a co-pilot tool for advisors, and launched pre-packaged tech stack for RIAs.