Vestwell Raises $125 Million Series D

The preempted round will fast-track Vestwell’s mission to transform Americans’ access to savings

Vestwell, the leading employer and individual savings platform, has raised its Series D round, totaling $125 million. The large preempted equity financing is a testament to the conviction these investors have in Vestwell’s trajectory and its future; the funding round also firmly establishes Vestwell as one of the biggest US funding success stories of 2023 in the fintech and SaaS sectors. Moreover, as Vestwell was already poised to reach profitability, the new funding allows for further accelerated growth opportunity focus and ensures the company is fully capitalized for the future.

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The round was led by Lightspeed Venture Partners. Existing investors Fin Capital, Primary Venture Partners, and FinTech Collective, and newcomers Blue Owl and HarbourVest, also participated.

As part of the round, Lightspeed’s lead fintech Partner, Justin Overdorff, has joined Vestwell’s board of directors. With a background in business development, operations, and VC across SaaS and fintech, Overdorff’s product-first mindset has seen him help businesses, including Stripe and Alloy, to reshape their industries. 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.

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.

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.

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Aaron Schumm, CEO and founder of Vestwell, comments:

“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. With such great people and teams around us, the future continues to look very bright for 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. We’re already working exceptionally well together, and I’m very excited to see what we achieve together as we expand and accelerate the business into its next phase.”

“We are deeply impressed by Vestwell for its groundbreaking infrastructure-first approach to solving the systemic savings problem in the US. Their commitment to the thoughtful execution of its plans assures us of its stability and growth potential in the workplace savings and investment space. The 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. They’re undeniably the dominant player and a true disruptor when it comes to the savings landscape – Lightspeed is excited to invest, and I’m proud to be joining the board and look forward to working closely alongside Aaron and his team to accelerate this company together.”

Logan Allin, Founder and Managing Partner at Fin Capital, says:

“Vestwell stands out as a pivotal player in the US financial sector thanks to its innovative approach to simplifying savings. It addresses a crucial need, showing immense potential in a market ripe for disruption. The unique blend of user-friendly technology with a breadth of robust financial tools gives it a significant edge. As they continue to scale, we know that they will redefine the savings and retirement landscape for Americans.”

Vestwell has had a hugely 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.

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