Betterment Raises $10M From Menlo, Bessemer, Anthemis

Betterment said it raised $10 million in a Series B financing led by Menlo Ventures and joined by existing investors Bessemer Venture Partners and Anthemis Group. Since its launch in 2010, Betterment, an online investment service, has increased customer assets under management 500% a year, according to a press release.

PRESS RELEASE

BETTERMENT RAISES $10 MILLION SERIES B FINANCING 
FROM MENLO VENTURES, BESSEMER VENTURE PARTNERS, & ANTHEMIS GROUP

(New York, NY – October 3, 2012) Betterment (www.betterment.com), the groundbreaking online investment account that makes life better, today announced it has secured $10 million in second round financing led by Menlo Ventures. Existing investors Bessemer Venture Partners and Anthemis Group also participated in the round with major contributions. Since its launch in 2010, Betterment has experienced rapid growth, increasing customer assets under management at 500% per year.

Behavior-­‐based financial advice, elegant design, and extremely low cost portfolio management are hallmarks of Betterment’s radically different approach. Its streamlined solution frees up time and helps people reach their biggest dreams faster. The only low-­‐cost investing service to both automate good behaviors and help customers make better decisions, Betterment is dedicated to helping people live better. Compared to the average money manager, the company estimates it will save its current customers $5Billion in fees over their lifetimes. Compared to do-­‐it-­‐yourself financial planning and investing, Betterment estimates it saves customers 9 million hours – or the equivalent of 110 full working lifetimes.*

“Menlo Ventures has a proud history of investing in entrepreneurs who think big. Betterment is disrupting one of the most archaic industries – an industry that is hungry for innovation and rife with bad practice,” said John Jarve, Managing Director of Menlo Ventures. “Betterment is the Apple of Investing: a powerful product with a simple, seamless UX. We’re proud to partner with these bold innovators.”

“We’re thrilled to announce our partnership with Menlo Ventures,” said Jon Stein, CEO and Founder of Betterment. “The funding allows us to accelerate growth and make our product better in all of the areas our customers have been requesting. We will soon offer an improved mobile experience, better options for shorter term goals, a more holistic approach to money management, and new behavior-­‐based ways to encourage people to make the most of their money and lives.”

Launched in May 2010, Betterment has evolved to include Traditional and Roth IRAs, unique advantages like auto-­‐deposit, auto-­‐rebalancing, goal-­‐based investing, and the recently introduced Betterment Gifts, a next generation gift registry that enables people to contribute towards the biggest dreams of their friends and family. The typical complexities and time-­‐consuming tasks of a well-­‐managed investment account are automated with Betterment’s sophisticated platform, freeing up time for other important things in life. Behavioral guardrails built into the account help users make smarter decisions with their finances.

For more information on Betterment, visit: www.betterment.com. ###
Media Contact: Johanna Scott 212.228.1328 johanna@betterment.com

Media Contact:
For more information on Betterment and to arrange an interview with CEO, Jon Stein, please contact Johanna Scott: johanna@betterment.com or 212.228.1328.

About Betterment:
Betterment is a groundbreaking online investment account dedicated to helping people reach their goals. Betterment achieves this through low cost, smart financial advice, and elegant design to guide users to better decisions. The typical complexities and time-­‐consuming tasks of a well-­‐managed investment account are automated with Betterment’s sophisticated platform, freeing up time for other important things in life. Behavioral guardrails built into the account, help users make smart, rational decisions with their finances. This suite of services is unavailable anywhere else, including the large investment firms. Betterment was honored with FinovateFall 2010’s “Best of Show” award and was also named “New York’s Best Startup” at TechCrunch Disrupt May 2010. For more information, please visit www.betterment.com. Follow Betterment on Facebook: facebook.com/betterment, Twitter: @betterment, and Google+: http://gplus.to/betterment.

About Menlo Ventures
Menlo Ventures provides capital for seed through growth technology companies in the consumer and enterprise sectors. For decades, the firm’s market-­‐driven research analysis has led to the identification of and successful exits in innovative technology markets. Notable research-­‐areas of investment include Mobile (Siri, MobiTV, TeleNav), Enterprise storage (3Par), Communications (Acme Packet, Cavium Networks), and Consumer (Carbonite, Roku). Founded in 1976, Menlo’s portfolio includes 70 public companies and more than 100 mergers and acquisitions. Throughout our history, Menlo’s deep network of portfolio entrepreneurs, angels and advisors are a key resource made available to all of our family of investments. Menlo Ventures has $4 billion under management and is currently investing Menlo Ventures XI, a $400M fund with $20m allocated to our Menlo Talent Fund for fast seed funding. For more information, visit www.menlovc.com

About Bessemer Venture Partners
Bessemer Venture Partners (BVP) is a global venture capital firm with offices in Silicon Valley, Cambridge, Mass., New York, Mumbai and Herzliya, Israel. BVP delivers the broadest platform in venture capital spanning across industries, geographies, generations and stages of company growth. From Staples to Skype, VeriSign to Yelp, LinkedIn to Pinterest, BVP has helped incubate and support companies that have anchored tidal shifts in the economy. More than 100 BVP-­‐ funded companies have gone public on exchanges in North America, Europe, and Asia. For more information please visit www.bvp.com.

About Anthemis Group
Anthemis Group is re-­‐inventing finance. It is a diversified financial services group advising, transforming and investing in businesses that through technology are building better ways to provide and deliver financial services that meet the expectations of 21st century customers. For more information, visit http://anthemis.com/.

Data
• Betterment is saving its customers $5B in fees over their lifetimes.
 o Data is based on an assumed investing period of 35 years, growth of 5% per month for the next 3 years,
and a more moderate long-­‐term rate of 1% per month thereafter.
 o The difference in fees is calculated considering a net difference of 1%.
• Betterment is saving its customers 9 million hours in time over their lifetimes. 
o The average full working lifetime is based on an assumed working life of 40 years.
 o Time saved is based on using Betterment vs. do-­‐it-­‐yourself financial planning and investing, which can take 10 hours per year (re-­‐balancing, transacting, checking statements, and researching funds).
 o Data is based on an assumed investing period of 35 years.

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