Fintech Vestwell raised $125 mn in Series D for savings platform

Vestwell, a fintech platform for employer and individual savings, has successfully completed a Series D fundraising round, securing a $125 mn.

This substantial preemptive equity financing round not only reflects the investors’ strong belief in Vestwell’s growth trajectory and future prospects but also cements its status as one of the most notable US funding achievements in 2023 within the fintech and SaaS arenas.

Already on the verge of profitability, Vestwell will leverage this new capital infusion to further accelerate its growth initiatives and strengthen its financial foundation for the future.

This funding round was spearheaded by Lightspeed Venture Partners. It also saw participation from existing investors, including Fin Capital, Primary Venture Partners, and FinTech Collective, alongside new investors Blue Owl and HarbourVest.

In conjunction with this funding round, Justin Overdorff, Lightspeed’s leading fintech Partner, will join Vestwell’s board of directors.

Fintech Vestwell raised $125 mn in Series D for savings platform

Overdorff, known for his product-centric approach, brings extensive experience in business development, operations, and venture capital across SaaS and fintech domains.

His notable contributions to industry-leading companies like Stripe and Alloy have been instrumental in driving significant industry transformations.

Logan Allin will remain a board director since co-leading Vestwell’s Series C. He brings deep expertise in entrepreneurial advisory, having worked closely with scaling fintechs in his role at SoFi Ventures before founding Fin Capital, whose portfolio companies include Circle, DailyPay, Greenlight, and SumUp.

Aaron Schumm, CEO and founder of Vestwell

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

Aaron Schumm, CEO and founder of Vestwell

“We weren’t expecting Lightspeed to proactively approach us with the offer to lead our next funding round, given we had not planned to raise any capital. But soon after they did, our mutual conviction – that this industry is crying out for innovation and that Vestwell is the one to deliver it – became clear”, Aaron Schumm says.

Vestwell will use the funding to continue its rapid expansion and fulfill its mission to bring savings solutions to more businesses and individuals across the country, as demand reaches unprecedented levels.

In particular, the move will support small and emerging businesses that have benefited from regulatory tailwinds (such as the SECURE 2.0 Act) and are now increasingly seeking workplace savings programs that allow them to escape the high fees and heavy administrative burden of legacy providers in order to offer employees solutions that are fit for purpose.

Justin Overdorff, Partner at Lightspeed Venture Partners

Vestwell’s platform is already transforming the financial futures of countless Americans, demonstrating not only a strong, healthy enterprise SaaS business model but also a clear, decade-long vision

Justin Overdorff, Partner at Lightspeed Venture Partners

The capital will also be used to expand Vestwell’s focus on state-savings program initiatives while developing other savings program initiatives for the partners, employers, and savers utilizing Vestwell.

Further, it will build on the firm’s proven track record in catalyzing the growth initiatives of the leading financial institutions that white label Vestwell’s product, empowering them to remain competitive, better serve their customers, and contribute to closing the American savings gap on a large scale.

Vestwell has had a successful 2023 amidst a tumultuous global macroeconomic environment, releasing several new products and securing multiple large-scale partnerships with major financial institutions and state governments.

This includes being selected by JPMorgan to expand its 401(k) product, adding to Vestwell’s existing relationships with leading firms such as Morgan Stanley, and a streak of winning state-sponsored IRA programs across the country.

Vestwell now powers over 30 state savings programs across automatic IRAs, 529 Education Savings, and ABLE programs, making it the leading partner for state governments in the United States.

Peter Sonner   by Peter Sonner