What’s behind Vestwell’s $125M Series D funding?

investmentnews.com:

The fintech that has been winning bid after bid in the state-run retirement plan market, Vestwell, just got an additional $125 million in funding.

That firm, which has been quickly building its business in the auto IRA, 529, ABLE, and 401(k) arenas, today announced the results of its Series D funding round, which was led by private equity firm Lightspeed Venture Partners.

The company has grown its revenue and client roster by tenfold over the past three years, CEO Aaron Schumm said. And it has hired 150 people over a year, reaching a headcount of about 350.

That’s been all but necessary as it has tacked on mandates from state-run programs. The company is the record keeper or administrator for more than 30 of those, and this year it landed a deal with J.P. Morgan to be the record keeper for Chase’s small-business savings program, Everyday 401(k), which at the time represented about $27 billion in assets.

And as the firm has added partnerships with states, that has positioned strongly to add more.

Long game

“We are playing a very long game in terms of how we think about this world,” Schumm said.

The company spent years working with the idea that it could break down walls across the various types of tax-deferred accounts, seeing an opportunity to be more efficient than incumbents and make people more aware of the saving and investing options available.

Schumm said he thinks about those types of programs – 401(k)s, auto IRAs, 529 college savings accounts and ABLE accounts – as a “sphere of savings” that can fit the needs of different people.

“What if you took a 529 college savings plan and brought that into the workforce?” Schumm said. “That’s a lot of how we think about it.”

More funding

The recent funding round – by far