Vestwell, the New York-based FinTech, has just completed an impressive $125m equity round, marking a significant milestone in the US’s Series D SaaS funding landscape this year.
This strategic raise was led by Lightspeed Venture Partners, with participation from existing investors Fin Capital, Primary Venture Partners, and FinTech Collective, as well as new investors Blue Owl and HarbourVest.
The funds will be instrumental in accelerating Vestwell’s expansion. With a focus on introducing innovative products such as Emergency Savings Accounts (ESAs) and Health Savings Accounts (HSAs), the company aims to modernize the savings experience for American consumers and businesses. This initiative will move these groups away from outdated legacy platforms.
Vestwell’s core business revolves around empowering 80% of the state auto-IRA savings programs in the country. Additionally, the company collaborates with several top-tier financial institutions.
The capital injection is set to bolster Vestwell’s ongoing rapid expansion, especially at a time when demand for robust savings solutions is at an all-time high. Particularly, the funding will facilitate support for small and emerging businesses, which are currently benefiting from regulatory tailwinds such as the SECURE 2.0 Act. These businesses are increasingly seeking workplace savings programs that bypass the high fees and administrative burdens of traditional providers.
In addition to this, Vestwell will also focus on expanding its state-savings program initiatives. Moreover, the company plans to build upon its track record of catalyzing the growth initiatives of leading financial institutions that utilize Vestwell’s white-label product. This will not only help these institutions remain competitive but also contribute significantly to bridging the American savings gap.
Vestwell CEO and founder Aaron Schumm commented on the funding, stating, “We’re exhilarated to announce our Series D round – our growth has been truly exceptional, and we’re honored to be working with an array of such esteemed investors and partners. We’re also excited to have Justin and Logan on our board as we partner to bring savings to a new level. With such great people and teams around us, the future continues to look very bright for Vestwell.”
Justin Overdorff, Partner at Lightspeed Venture Partners, also expressed his enthusiasm: “We are deeply impressed by Vestwell for its groundbreaking infrastructure-first approach to solving the systemic savings problem in the US. Their commitment to the thoughtful execution of its plans assures us of its stability and growth potential in the workplace savings and investment space.”
Logan Allin, Founder and Managing Partner at Fin Capital, added, “Vestwell stands out as a pivotal player in the US financial sector thanks to its innovative approach to simplifying savings. It addresses a crucial need, showing immense potential in a market ripe for disruption. The unique blend of user-friendly technology with a breadth of robust financial tools gives it a significant edge. As they continue to scale, we know that they will redefine the savings and retirement landscape for Americans.”
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