Wealth management startup Altruist has raised $50 million in a Series B round of funding from some of the most recognizable names in finance.

Insight Partners, a venture capital and private equity firm with $30 billion in assets, led the round and Vanguard Group, one of the world’s largest investment firms with trillions of dollars in assets, also invested. Venrock, the Palo Alto venture capital firm that led a seed round of $8.5 million for Altruist in 2019, also participated in the latest round.

Jon Rosenbaum, a principal at Insight Partners, will join Altruist’s board and Jeff Horing, a co-founder and managing director, will take an observer seat. 

[Like this article? Subscribe to RIA Intel’s' thrice-weekly newsletter.]

“Altruist’s vision requires both deep FinTech innovation and empathy toward not only its RIA customers, but also their clients. We’re confident in the management team’s ability to deliver world class SaaS applications while ultimately improving the well-being of consumers who are looking to save,” Rosenbaum said in a statement. 

“We’re confident Altruist is the platform that will transform the financial advising industry in practice, not just in concept.”

In January, RIA Intel  reported that F. William McNabb III, the former chief executive and chairman of Vanguard Group, invested in and joined Altruist’s board. The startup also revealed that Ron Carson, the founder and CEO of Carson Group, an Omaha, Neb.-based RIA that manages $16 billion, had invested in it but the company declined to share how much it was raising or who the other investors were.

When asked in January if the unnamed investor was Vanguard, Altruist founder and CEO Jason Wenk replied frankly at the time, “I can’t say who it is” at the request of the investor. But he promised it would make a splash. Wenk couldn’t be reached to comment on his company’s latest round of funding, but Vanguard was likely the investor he alluded to earlier this year.

Altruist launched in 2019 and advertised itself as a new digital, commission-free custodian for RIAs that could save them as much as 90% on technology costs. But it is currently an investment platform that sits on top of an existing custodian, Apex Clearing. In January, Wenk told RIA Intel there were no plans in place this year to begin custodying assets itself. But Altruist is still solving one of the biggest problems in the RIA space: streamlining disjointed software services that cost financial advisors time and money. (It hired a former TD Ameritrade director in February to help it explain that to the market.)

The new funding will help the company develop and scale its paperless advisor platform that includes a modern user interface, client portal, and can open and fund accounts in under two minutes. Advisors can then use it to trade and rebalance portfolios, leverage Altruist’s own model marketplace, reporting, and billing that can accommodate different business models.

“Just like any financial advisor, Altruist wants to help people feel great about their money. At the same time, we want to help our industry innovate beyond the antiquated and expensive legacy tools that impede financial advisors and their clients,” Wenk said in a statement released about the funding. 

“There are millions of people who want real, quality financial help, and there are thousands of advisors who want to serve a diverse community of investors. Altruist is here to bridge that gap.” 

Michael Thrasher (@Mike_Thrasher) is a reporter at RIA Intel based in New York City.

Subscribe to RIA Intel’s thrice-weekly newsletter and follow the publication on Twitter and LinkedIn.