Financial tech firm Blooom is blossoming into a local startup success story.
The Leawood-based company announced Thursday that it raised $4 million in a Series A round to expand its operations. QED Investors from Alexandria, Va., led the round, which also included DST Systems Inc., Commerce Ventures, Hyde Park Venture Partners and UMB.
Blooom created an online 401(k) management tool that helps users grow their account through professional management. The tool uses a flower in various growth stages to symbolize the health of one’s 401(k) and offers professional advice on how to allocate funds.
Blooom now manages more than $110 million and reached that milestone twice as fast as other “robo-advisors” such as Wealthfront and Betterment, said Maureen Welsh, Blooom’s director of public relations. Blooom is lead by CEO Chris Costello, a financial professional of more than 15 years, and president Greg Smith, a former executive at Goldman Sachs. Smith previously wrote a scorching op-ed piece on Goldman Sachs after resigning from the company that was published in New York Times.
To access Blooom’s services, users pay $1 per month for an account less than $20,000, and $15 per month for accounts more than $20,000. Costello previously said that the platform resonates well with younger people who lack knowledge about their 401(k)s and are more apt to conduct financial transactions online.
The $4 million capital raise is just the latest good news for the financial tech company.
Blooom in September won a $50,000 grant from the national LaunchKC competition. And earlier in October, the company advanced to become a semifinalist in a competition to snag $10,000 from the Ewing Marion Kauffman Foundation.
In 2014, Blooom beat out more than 60 competitors to claim first place at the annual Finovate conference in New York City. The conference features dozens of financial tech firms hoping to disrupt the finance industry.
Founded in 2013, Blooom now employs 18 people.