Pension management firm Penfold closed an $8.5m funding round, $4m of which was from a crowdfunding campaign.
The round was led by Bridford Group, the Family Office of Jorg Mohaupt. Other investors included Force Over Mass Capital, Elkstone Capital and several angel investors like Alan Morgan of MMC Ventures and other senior figures in the finance industry.
The investment will be used to fund further growth for the business, expanding the team and activating an out-of-home marketing campaign.
Penfold’s co-founders Pete Hykin, Chris Eastwood and Stuart Robinson founded the business in 2019 after battling with the inflexible and jargon-filled traditional providers that dominate the market. They saw an initial opportunity to help the more than five million self-employed individuals in the UK, of whom only 14% save regularly into a pension.
Penfold offers a digital alternative to traditional pension companies, allowing users to set up, manage and track their pensions easily online and via the app. Contributions can be paused and topped up with instant one-off payments and it’s one of the first pension providers to offer an open banking integration, it said.
Users can choose to invest their money sustainably and can track down and combine lost pension pots in just a few taps. The dashboard explains how much they have saved and how far they are from their ultimate goal. Users are charged an annual percentage fee on their pension balance – 0.75% – but with no other fees.
The company is now approved by the FCA to operate a pension itself rather than relying on third parties.
Commenting on the funding, Hykin said, “The sheer popularity of the crowdfund shows that Penfold is a solution to a real problem for lots of people. Saving for your future should be as easy as online banking, but the legacy pension companies are making it hard for consumers to have visibility or control of their pension pots. We’re cutting out the complexity in pensions – and people are showing their support by investing in us.”
Echoing a similar sentiment, Plug & Play Ventures partner George Damoney added, “We see the retirement savings market as significantly untapped, underserved, and a ticking time bomb for many groups – especially the self-employed. A combination of younger generations not saving enough, people living longer, and inadequate state pensions all contribute to a growing need for better and more engaging products. From their pension calculator to their extensive content library, and the sustainable and sharia-compliant funds – Penfold is creating a fundamentally better proposition which users love. They’ve shown they don’t just want to build a better product than what’s on the market, but the best possible one.”
Penfold competes with pensions giants such as Standard Life, Scottish Widows, Aviva and AJ Bell as well as startups like PensioBee.
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