Two and a half years after its launch, Wealthfront, the algorithm-based financial advisory service marketed toward the "millennial" investor, has hit $1 billion in assets. The milestone comes less than four months after the Silicon Valley startup that had the traditional wealth management industry questioning its sustainability hit the $700 million mark, topping competitors like Betterment and Personal Capital in the automated investment management space.
The company, which has been called the "Uber of wealth management," has undergone two rounds of venture capital funding, the first of which which was led by investing powerhouse Andreessen Horowitz, and targets young people, hoping to capture a large chunk of what Wealthfront estimates is 90 million people in the U.S. with a net worth of $2 trillion. The goal is to hook early investors in their twenties and keep them for life.
Roughly 60% of Wealthfront's client base fits this description so far, with an average portfolio size of $93,000.
And as the firm is seeking investors who favor technology over a human to manage their money, it's no surprise that Wealthfront counts a number of tech sector professionals as its clients, helping Twitter employees manage their newly public stock holdings, with an eye toward attracting the next set of new millionaires to come out of the startup world as investors.
In a post on its blog announcing the $1 billion in assets, Wealthfront, which often compares itself to financial advisory giant Charles Schwab, said that it hopes to grow at least 100 times as large in record time.
"Wealthfront reached its first $1 billion in assets in less than half the time it took Schwab," the company wrote. "We hope that by focusing on Millennials the way Schwab focused on Baby Boomers, we can continue our rapid growth to $10 billion, $100 billion, and beyond."
Mariah Summers is a business reporter for BuzzFeed News and is based in New York. Summers reports on hospitality, travel and real estate.
Contact Mariah Summers at email@example.com.
Got a confidential tip? Submit it here.