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Vestwell Raises $125mm Series D

Vestwell raised $125mm in a Series D to continue it's mission to close the savings gap for Americans. Although the release did not give a valuation, Bloomberg is reporting that people familiar with the transaction estimate it to be around $1 billion(1). They have raised approximately $240mm to date according to Crunchbase, so the valuation is not a stretch given the market penetration they have been able to achieve. If true, it would be one of the few WealthTech unicorns out there at the moment, which is impressive given that they only launched in 2016.

The latest round also saw two new investors, HarborVest and Blue Owl, two private equity/private debt firms, so it seems like they are moving up in terms of zip code. Three existing VCs also participated in the round, including 3 of the 4 original investors: Fintech Collective, Fin Capital, and Commerce Ventures. We didn't see a mention of any of their existing strategic investors in this round, but the support there is significant: Goldman Sachs, Nationwide, Allianz Life Ventures, BNY Mellon, Franklin Templeton, Wells Fargo Strategic Capital, Morgan Stanley, and others.

Vestwell's success seems to come from learning how to crack the code for the US workplace savings market, one of the largest, least crowded markets in the US, if not the world, in our opinion. Furthermore, it has managed to do this despite a highly concentrated and entrenched recordkeeper environment and a lower legislative agenda around addressing the advice gap, at least compared to countries like the UK. And no mention of AI anywhere.

(1) Swetha Gopinath and Aisha S Gani , "Goldman-backed Vestwell Raises Funds at $1 Billion Valuation" Bloomberg, Dec 22, 2023. Link


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