The more money that flows from traditional wealth managers to Web-based alternatives, the more venture capitalists want to invest.
In the last two days, Wealthfront and Personal Capital raised a combined $114 million to bulk up their automated offerings. The big idea is pretty simple: traditional money management is costly, opaque and underperforms the market, so surely technology can do better.
"There are over 90 million millennials in the United States, and they are increasingly demanding a different type of investment service than Wall Street offers their parents," Wealthfront CEO Adam Nash said in a statement on Tuesday. The Palo Alto, California-based company raised $64 million in a financing round led by Spark Capital Growth.