Capitalize, the first platform to help consumers and financial institutions digitally find and transfer retirement assets, sequred of a $19 mn Series B funding round, led by RRE Ventures.
The round included participation from existing Capitalize investors including Canapi Ventures and Bling Capital, and new investors including Industry Ventures.
Since launching in 2020, Capitalize has rapidly expanded its platform to digitally locate and transfer legacy retirement accounts, and is now processing several billion dollars of rollover volume annually.
Both rollover volume on the Capitalize platform and Capitalize’s revenue have grown by approximately 6x in the last 18 months.
Capitalize is the first platform to help consumers and their financial institutions digitally locate and transfer retirement assets, such as 401(k)s.
Capitalize’s technology is used by leading financial institutions to power rollovers natively for their users and is also available to consumers directly.
A new driver of Capitalize’s recent growth has been its Enterprise business, which allows leading financial institutions to embed Capitalize’s rollover technology directly into their onboarding and funding flows, helping their customers find and transfer legacy employer-sponsored retirement accounts such as 401(k)s into a new account of their choice.
Capitalize now offers a full suite of enterprise-grade APIs, led by the recent launch of its Embedded Rollover API, which allows partners to leverage Capitalize technology to power rollovers in a native, seamless way.
We’re excited to keep modernizing the antiquated rollover process so that Americans can better move and manage their money, and our partners can serve their users more efficiently
Gaurav Sharma, co-founder and CEO of Capitalize
Each year, millions of Americans change jobs and either leave behind or prematurely cash out their 401(k) account. Others are forced to endure the manual “401(k) rollover” process to transfer their assets into a new retirement account. Historically, the rollover process has imposed a significant administrative burden on individuals, forcing them to contact multiple financial institutions, fill out tedious paperwork, handle phone calls, and often receive and forward physical checks.
The result is that more than 29 mn Americans have forgotten or left behind over $1.65 trillion in 401(k) assets in their former employer’s plan.
The rollover process has also made it harder for consumer-focused financial institutions to fund new retirement accounts and grow their retirement assets.
Capitalize’s proprietary rollover technology solves this problem for both individuals and retirement account providers by digitizing the approximately $1 trillion of 401(k) rollovers that occur annually.
“We’ve known Gaurav and the Capitalize team since 2020, and have been incredibly impressed by the thoughtful, systematic approach they’ve taken to building a great company in this important industry”, said Raju Rishi, General Partner at RRE Ventures
Capitalize will use the new capital to accelerate technology investment in its core rollover platform and expand to serve both partners and consumers with additional features and transfer types. The funding will also be used to support ongoing growth in new and existing Enterprise partners, and serve additional segments of the market, including financial advisors and recordkeepers.
by Peter Sonner
