Digital financial advising company Personal Capital came out of stealth mode and announced $25 million of combined first and second round funding today.
Personal Capital has a suite of mobile, iPad and web applications that contain helpful financial tools and can connect users to a personal adviser. The apps are still in beta but Personal Capital hopes to release them to the public in September. There are two options: free or a paid subscription. The free option gives you access to data about your financial life, with analytics to show you how you are doing and what decisions you should be making. The paid version adds access to a human financial adviser and the more traditional aspects of financial advisers.
According to Personal Capital chief executive Bill Harris, much of the financial industry has already made the move online. This includes banks and brokerage firms that have switched and are offering many of their services on the Internet. But the personal financial adviser is still stuck in “pre-electronic practices.”
“A significant amount of people with significant assets don’t want to have to get in the car to do something financially. They want to do it instantly,” said Harris. “We’re trying to merge the technical, real time data infused experience of the web, with the ability to have a personal relationship.”
Advisers at Personal Capital have all the necessary certifications as well as a few years of experience. The difference, however, is these advisers work out of a call center in San Francisco and not out of traditional offices. The benefit of this is instant on-call information and advice, as opposed having to set up a meeting and heading to an office to discuss your financial situation.
One concern for anyone sharing personal information on the Internet is security. Harris said Personal Capital has multiple authentication measures in place “just to get in the front door,” in addition to encryption keys which aren’t even shared with the company employees.
Personal Capital’s developers, along with Harris who was previously the chief executive of PayPal and Intuit, aren’t foreign to security issues. In 2004, Harris created a security authentication company called Passmark, which was purchased by RSA in 2006. Three top developers at Personal Capital also worked in Passmark. According to Harris, Passmark is now used in a number of banks across America.
Personal Capital was founded in 2009 has 35 employees and is headquartered in Redwood City, Calif. The company’s first round of funding was $10 million from Institutional Venture Partners and its second, for $15 million, was led by Venrock.