Betterment.com, the smart online investing service for anyone seeking better ways to manage their savings, today announced that the company closed $3 million in a Series A financing round led by Bessemer Venture Partners.
Additional support for this round comes from Anthemis Group SA and a group of prominent influencers in the investing space including Thomas Lehrman, Fabrice Grinda and Dave Abner. Funds from the round will be used to grow Betterment's internal team and to support the formation of new products scheduled to launch within the next year.
"Betterment is in a unique position to shake up the personal finance space with an extremely intuitive interface and superior technology that helps people make smart investment decisions," said Rob Stavis, a partner at Bessemer Venture Partners. "The team is comprised of financial product development and investment management experts who saw a need in the current market place and created a more straightforward investing tool."
Since its official launch at TechCrunch Disrupt in May, Betterment has signed up thousands of users and was recently named a "Best of Show" presenter at FinovateFall 2010 in October. The company is currently managing millions of dollars in investments.
"Our passion is making smart investing accessible to customers everywhere -- many of whom have been misguided, overwhelmed, or simply underperforming with their investments until now," said Jon Stein, CEO and Co-Founder of Betterment. "This funding gives us the resources to continue our momentum, growth and innovation by developing our next generation advice, management, and ease-of-use enhancements. It is a great honor to be backed by Bessemer Venture Partners since they have an incredible track record of building industry leaders and successful companies."
New Betterment Feature Provides Less Risk
Today, Betterment launched a more diversified Treasury bond portfolio designed to be less sensitive to interest rate changes. The introduction of a shorter duration Treasury bond ETF to the portfolio reduces the risk of value loss in a rising interest rate environment, while still addressing potential inflation. This feature will automatically be incorporated into all current and new users' investments to provide a more balanced bond portfolio, while retaining an attractive return that is likely to be higher than that of the average savings account.