By Aisling Finn on Tuesday 4 May 2021
A number of celebrities including Ryan Reynolds, Michael J. Fox and Drake were among the investors participating in digital wealth manager Wealthsimple’s latest funding round.
In a year where people have had more time to focus on their finances, it seems investors are also seeing the value in investment platforms.
Canadian money management platform Wealthsimple, founded back in 2014 to bring investment management services to millennials, has closed a C$750m (£439m) funding round and hit a valuation of C$5bn.
The round was led by Meritech, which has invested in the likes of Salesforce, Facebook, Snapchat and GoFundMe, and Greylock, an investor in Airbnb, Facebook, Instagram and LinkedIn.
"The financial services industry is in the midst of a massive transformation, and our continued growth, and the interest from some of the world's leading investors, proves that Wealthsimple is poised at the leading edge of that transformation in Canada," said Mike Katchen, CEO of Wealthsimple.
"More than two million Canadians use Wealthsimple to grow their money, file their taxes, pay their friends, and make their financial lives better. This investment will fuel our growth so we can reach millions more and ensure that everyone has access to the simplest, most powerful financial products and services, no matter who they are or where they are in their financial lives."
Other investors in the round include DST Global, Iconiq, Dragoneer, TCV, Sagard, Allianz X, Base 10 and Redpoint among many others.
Adding a touch of Hollywood glamour to the Canadian tech scene, A-list actors Ryan Reynolds, Michael J. Fox, rapper Drake, basketball players Kelly Olynyk and Dwight Powell and ice hockey player Patrick Marleau also joined the round.
"Wealthsimple has been able to capture a generation of financial consumers in Canada with financial products that are markedly different than anything offered by the incumbents — simpler, more human, and built with the kind of technology that delivers an experience consumers want," Max Motschwiller, general partner at Meritech added.
Katchen said that the funding will be used to help accelerate its ambitious growth plans, hire more employees, build products and “become the biggest consumer finance company in Canada in the process.”
Just like its peers, Wealthsimple experienced rapid growth during the pandemic, seeing its assets under management top $10bn and count more than 2m customers across Canada, the US and the UK.
Wealthsimple’s large customer base can be largely attributed to its socially-focused approach to investment.
The Canadian fintech offers Sharia-compliant investment opportunities for Muslims, as well as socially responsible portfolios that allow investors to avoid companies that don’t meet certain environmental, social and governance criteria.