NEW YORK (Reuters) - SigFig, a San Francisco-based startup that provides wealth management technology to financial companies, has raised $50 million from investors, it said on Tuesday.
The fundraising round was led by investment firm General Atlantic, with participation from existing investors including UBS Group AG, Eaton Vance Corp and Bain Capital Ventures.
SigFig will use the funding to invest in developing new technology and expanding the type of services it offers clients including large banks such as UBS, Wells Fargo and Citizens Bank, it said.
Founded in 2007, the company sells software to established large financial institutions to enable them to offer new digital service such as automated wealth management, known as robo-advice. SigFig also provides robo-advice directly to consumers.
It also provides technology to enable human financial advisors to enhance their services.
“We have seen a remarkable uptick in banks wanting to partner with fintech companies,” Mike Sha, CEO and co-founder of SigFig, said in an interview.
Sha said the company could also offer products to help bank branch employees provide advice to clients.
SigFig’s investment round comes as traditional wealth managers and banks seek to improve their online and digital offerings in the face of changing customer demands and more competition from tech-savvy startups.
In November, Wells Fargo launched a robo-advice service developed with technology from SigFig, while Citizens Bank partnered with the startup in late 2016 to help manage portfolios of middle-income people saving for retirement.
“The market for digitally-native investment advisors continues to grow due to increasing customer demand for accessible and affordable financial advice,” Paul Stamas, managing director at General Atlantic, who will join the company’s board of directors, said in a statement.
SigFig had last raised $40 million in a round led by Eaton Vance in 2016.
The round announced on Tuesday was not much larger because SigFig was a “very capital efficient” business and does not need to spend lots of money on marketing, Sha said. He added that the company was not profitable yet “by choice”, because it was reinvesting in growing the business.
Other investors in the round included DCM Ventures, New York Life, Nyca Partners and Union Square Ventures.
Reporting by Anna Irrera; Editing by David Gregorio