Betterment (company)
| File:Betterment logo.svg Logo since November 2021, featuring a rising sun motif | |
| Company type | Private |
|---|---|
| Industry | Financial services |
| Founded | January 1, 2008 in New York City, United States |
| Founder | Jon Stein, Eli Broverman |
| Headquarters | New York City , United States |
Area served | United States |
Key people | Sarah Levy (CEO) |
| Products | Investment management, retirement planning, cash management, 401(k) solutions, digital investment advisory platform |
| Parent | Betterment Holdings, Inc. |
| Website | betterment |
Betterment is a U.S.-based financial advisory firm that provides digital services in investment management, retirement planning, and cash management.
The company is headquartered in New York City and is registered with the Securities and Exchange Commission. It also holds membership in the Financial Industry Regulatory Authority and functions as both a registered investment advisor and a broker-dealer.
As of September 2024, Betterment oversaw assets exceeding $56 billion across more than 900,000 client accounts, underscoring its prominent role within the digital investment sector.
Origins and establishment
Founded in 2008 in New York City by Jon Stein, an MBA graduate from Columbia Business School, and Eli Broverman, an attorney trained at NYU School of Law, Betterment LLC was incorporated as a Delaware corporation on April 7, 2009. Its parent entity, Betterment Holdings, Inc., was created earlier in January 2008. The company made its public debut at TechCrunch Disrupt New York in June 2010, where it earned the title "Biggest New York Disruptor" and rapidly gained nearly 400 initial customers within a day, sparking investor interest.
Business activities
Betterment’s operations are divided into three primary segments: retail investment services, an advisor platform, and a 401(k) solution tailored for businesses. Its financial guidance combines automated robo-advisor technology with access to licensed financial advisors available for optional phone consultations. The retail platform supports both taxable accounts and tax-advantaged options such as traditional and Roth IRAs.
In October 2014, Betterment launched Betterment Institutional—later renamed Betterment for Advisors—a business-to-business digital platform that empowers financial advisors to manage client portfolios using Betterment’s proprietary advice technology. By January 2017, the company had partnered with the Financial Planning Association to advance the adoption of digital investment advisory services.
The introduction of its 401(k) platform for small and medium-sized enterprises occurred in January 2016, providing affordable retirement plan solutions. This service was rebranded as Betterment at Work in February 2022, coinciding with the acquisition of Gradvisor’s college savings platform to broaden its product suite.
Jon Stein stepped down as CEO in December 2020, handing leadership to Sarah Levy, formerly COO at Viacom. In November 2021, Betterment unveiled a refreshed logo featuring a rising sun motif.
Expanding into cryptocurrency management, Betterment acquired Makara in February 2022. Subsequently, by October 2022, it introduced Crypto Investing by Betterment, enabling clients to invest in digital assets.
In December 2022, the firm revised its pricing model impacting smaller investors.
Betterment at Work conducted a survey in December 2023 examining retirement readiness among U.S. workers alongside shifting preferences for workplace benefits amid changing economic conditions.
January 2024 saw the launch of a commercial offering that allows small businesses to match employees’ student loan repayments with contributions into their 401(k) plans.
Betterment for Advisors enhanced its customizable portfolio options by incorporating thousands of mutual funds to commemorate the mutual fund industry's centennial milestone.
In April 2024, Betterment acquired Marcus Invest accounts from Goldman Sachs and began migrating these clients onto its own platform.
July 2024 marked the debut of the Goldman Sachs Tax-Smart Bonds portfolio aimed at investors in high tax brackets seeking tax-efficient fixed income strategies with lower volatility compared to equities.
On September 12, 2024, Betterment rebranded its RIA custody business as Betterment Advisor Solutions to better represent expanded portfolio management capabilities, high-yield cash offerings, and integrated retirement products. Concurrently, it released an independent study highlighting how technology enhances financial advisors’ client outcomes.
In February 2025, following earlier acquisitions including Wealthsimple’s U.S. advisory accounts (2021) and Marcus Invest (2024), Betterment further expanded by acquiring Ellevest’s automated investing division.
The next day saw the launch of Solo 401(k) plans through Betterment Advisor Solutions designed specifically for self-employed individuals, enriching its retirement solutions for independent financial advisors.
Finances
Betterment has attracted capital from a range of investors, including Bessemer Venture Partners, Menlo Ventures, Anthemis Group, Kinnevik, Francisco Partners, Globespan Capital Partners, Citi Ventures, The Private Shares Fund, Aflac Ventures, and ID8 Investments.
In September 2021, the company secured $160 million in growth funding, which comprised a $60 million Series F equity financing led by Treasury, alongside a $100 million credit facility arranged with ORIX Corporation USA’s Growth Capital division and Runway Growth Capital. This financing round placed the company's valuation at approximately $1.3 billion.
Awards and recognition
Betterment LLC was honored as the Best Overall Robo Advisor by WSJ's Buy Side, which assessed factors such as fees, investment approaches, financial planning offerings, tax-loss harvesting capabilities, and availability of premium services.