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LearnVest Lands $16.5 Million Funding Round, AmEx Deal

Advisors have some more competition brewing in the still-nascent online planning world.

Ambitious online financial planning firm LearnVest Planning is announcing Friday that it has closed a $16.5 million round of financing, which LearnVest founder Alexa von Tobel says will to help pay for rapid nationwide growth centered out of a new hub in Phoenix. The company says it is finalizing a yet-to-be-defined alliance with financial services giant American Express. 

“We have a lot of big distribution channels coming up,” says von Tobel. “We’re working with behavioral specialists with the ultimate goal of turning financial planning into a real consumer product.”

Manhattan-based LearnVest added “Planning” to its name after becoming an RIA last year. It currently employs a staff of 25 planners and a back office of 80 programmers, compliance officers and other full-time staff. It has said it plans to hire another 75 planners by year’s end.


American Express Ventures is one of five investors in LearnVest’s most recent round of funding. The lead investor is venture firm Accel Partners, which has participated in previous rounds. The others include the private equity firm Claritas Capital; Ed Mathias, a managing director of the Carlyle Group and Todd Ruppert, former CEO of T. Rowe Price Global Investment Services.

Prior to this week, LearnVest had attracted more than $25 million since its founding in 2009.

At the same time, a group of four advisors have formally signed on to help LearnVest with its expansion, von Tobel said. The group includes Mathias and Ruppert, as well as Susan Lyne, currently CEO of AOL’s Brand Group, and Ann Sardini, ex-CFO of Weight Watchers. Von Tobel has often said her aspiration is to have LearnVest subscriptions function much as Weight Watchers or gym memberships do, making financial planning much more readily accessible to middle-class consumers.

Lyne previously served as vice chairman at the online fashion retailer Gilt -- a role that von Tobel thinks will prove particularly useful to growing LearnVest. “When you think of what a fast-growing startup has to deal with, think of Gilt,” von Tobel says. “They grew [to] hundreds of employees in an extremely short period of time while hiring technology talent and VP talent. And when you think about Weight Watchers, it’s for someone who is focused on self-improvement. ... There’s a lot of really interesting insights there” for LearnVest, von Tobel says.


Neither AmEx nor Von Tobel shared more details of the AmEx partnership, other than to say it is being finalized.

“We believe strongly in the mission of LearnVest Planning to provide accessible financial advice,” Harshul Sanghi, managing partner of American Express Ventures, said in a prepared statement. “As we seek to expand our portfolio of products across American Express, we believe LearnVest Planning can be an important partner in helping us to bring customers more convenient, affordable and transparent ways to manage their money.”

It’s not the first time that American Express has aligned itself with a planning firm. Before spinning it off as part of Ameriprise, American Express owned Securities America between 1998 and 2005.

According to von Tobel, LearnVest also is in the process of signing contracts with a number of companies that will pay for or subsidize LearnVest accounts for employees, giving them "unlimited" access to financial planners as part of their benefits package. She declined to share the names of any of these companies or say how many LearnVest is negotiating contracts with, however.

Although LearnVest also has never disclosed the number of its clients, von Tobel says most work for companies with 401(k) plans and other benefits. The average income of LearnVest clients is between $70,000 and $100,000, she says.

LearnVest plans to expand its existing Phoenix office to become an operational hub, von Tobel says. “That’s not to say that all planners will work out of Phoenix,” she adds. “It can be a training ground. It will be a meeting ground. It will allow us to scale and service our customer base.” It’s also located conveniently close to a number of colleges and universities with financial planning programs from which LearnVest intends to hire graduates, she says.

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