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09/04/2018

Tech Startup That Buys RIA Clients Raises $33M

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Facet Wealth, a digital wealth management platform with an intriguing twist, has raised $33 million in Series A funding from investment firm Warburg Pincus and venture capital firm Slow Ventures.

The twist? Facet Wealth, which has $23 million in assets under management, acquires smaller clients from RIAs but promises to offer them back if client assets breach $1 million, Financial Planning reports.

“We want to be seen as a partner to the industry, not as a competitor,” Anders Jones, CEO and co-founder of Facet Wealth, is quoted saying.

The company’s business model shows how the technology that enabled the development of robo-advisors is being adapted to serve specific market niches. Baltimore-based Facet Wealth is targeting clients with assets from $100,000 to $1 million. Its average client is 55, transitioning to retirement and has $350,000 in assets.

“There is a gap in the market,” Jones is quoted saying. “These small clients have more money and more complex lives than what a purely robo advisor can help with, but not enough assets to attract the high-net-worth advisor.”

Each Facet Wealth client works with a dedicated CFP and pays according to services rendered. CEO Jones says clients pay an average of 41 basis points.

Ross Snel

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