Vestwell Continues Reshaping Retirement with a Purpose-Built Platform

Saving for retirement is not an area of financial strength for Americans. It’s not difficult to see why - 401(k) plans can be confusing, time consuming and painful to think about for employers and employees. With complicated regulations around “fiduciary responsibilities” and potentially high fees to implement a plan, it can be daunting for many employers. With this backdrop, it’s no surprise that less than half of small businesses in the US currently offer a 401(k) plan to their employees. However, delaying these important decisions around retirement planning can have significant consequences for employees and their ability to retire in comfort.

Vestwell changes the game for retirement planning. CEO Aaron Schumm launched the company in 2016 with the goal of using technology to modernize and simplify the process of setting up a 401(k) plan for plan sponsors (employers) and participants (employees), while reducing the costs involved for everyone.

“I have been a small business owner and experienced firsthand the difficulty in offering a 401(k) program to employees.  I have also been entrenched in the financial technology and services for many years, long before it was affectionately referred to as FinTech.  We have taken our unique vantage point, deep understanding of the moving parts in financial services, and a background in helping businesses scale through technology to help redefine how a 401(k) plan should work.  Pulling all of these pieces together can truly help close the retirement savings gap in America, while building our own business.”

At the same time, Aaron realized that, when it comes to important decisions like retirement planning, employers and employees continue to see value in engaging directly with a trusted, human advisor who can provide helpful, informed advice. Vestwell therefore aims to work alongside these advisors, providing them with an easy way to monitor and manage the 401(k) plans of their clients. By using Vestwell to reduce their administrative burden, the advisor has more time to provide the advice and support that their clients need. This combination of modern technology, coupled with a human touch, is a unique proposition for this industry and is generating significant buzz.

Since launching the platform earlier this year, Vestwell has onboarded over 50 financial advisor “home offices”, which together provide access to the Vestwell platform to hundreds of individual advisors, with thousands more in the queue. These advisors can then onboard both new and convert existing 401(k) plan clients to Vestwell’s platform quickly and easily. Vestwell is already managing assets for thousands of participants on the platform, and is continuing to grow quickly.

Some of the biggest names in the industry are already taking notice of Vestwell, including Fiserv, a Fortune 500 financial services technology provider, announcing a partnership with the company earlier this year. More large partnerships are soon to be announced. These high profile partnerships, coupled with growing awareness in the industry of Vestwell’s fresh approach to the 401(k) space has also led to some recognition for Aaron and the Vestwell platform, including success in the recent XYPN fintech competition.

At Primary, we’re proud to have had the opportunity to be a partner to Aaron from the earliest stages of his vision for the Vestwell platform. We participated in the company’s seed financing last summer, and Primary’s own 401(k) plan was one of the first to be onboarded onto the platform. Today we’re happy to announce our continued support of the company, as we join the company’s other existing investors, F-Prime Capital Partners, Fintech Collective and Commerce Ventures in the company’s $8MM Series A financing.

This financing will place the company on a strong path for the future, as Vestwell continues to build out their platform and create a truly scaleable business to transform retirement planning for all Americans. Our whole team has been impressed by the progress that the company has made so far, so much so that Primary’s own is Dave Sheen leaving us to join the Vestwell team in a finance role. Here at Primary, we look forward to continuing be supportive in any way we can, and are excited to see what lies ahead for the company. 


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