Founders: Jon Stein, Eli Broverman
Date launched: 2008
Funding: $105 million (Source: CrunchBase)
Industries disrupted: Personal finance, investing
Betterment is looking to break out in front of the pack of online financial services companies—so-called "robo-advisors"—to win the portfolios of investors. The New York City-based company, co-founded in 2008 by Harvard graduate Jon Stein, aims to attract clients—especially millennials—with automated tools and mobile apps that allocate portfolios to maximize returns and minimize taxes. And it does it with fees lower than the industry standard, because there are few human advisors involved.
Read MoreFULL LIST: 2015 DISRUPTOR 50
Unlike competitor Wealthfront, Betterment has no minimum amount that customers need to invest to get started. The company has about 90,000 customers and manages about $2.1 billion in assets. It charges fees ranging from 0.15 percent to 0.35 percent of assets, depending on the size of the account.
Research shows that the U.S. wealth-management market is valued at around $17 trillion. Venture funds, including Bessemer Venture Partners, Menlo Ventures and Northwestern Mutual Life, have invested $105 million in the company in the hope that it keeps grabbing a bigger piece of that pie.
"We'd like to put target date funds, annuities and mutual funds out of business. There's no good reason for them to exist anymore."
Read MoreBetterment was No. 45 on the 2014 CNBC Disruptor 50.