CHICAGO, Feb. 26, 2020 (GLOBE NEWSWIRE) -- M1 Finance, the free smart money management platform, today announced it has surpassed $1 billion in assets on its platform. M1 reached this milestone in less time from launch and with less venture funding than other fintech platforms, including Wealthfront, Betterment, Stash, and Acorns.
“M1 Finance is built for the ‘engaged investor,’ someone who wants to manage their money and enjoys the convenience of an intelligent, automated, and low cost platform,” said M1 Finance founder and CEO Brian Barnes. “Reaching $1 billion in assets on platform so quickly validates our vision and is a testament to our amazing team’s focus on creating the smartest money-management experience.”
Further, M1 Finance has been more capital efficient than its peers, building a free automated brokerage, a portfolio line of credit product, a digital banking experience, and reaching the $1 billion threshold with just $26.5 million in venture funding to date:
Table: Fintech Startup Capital Efficiency - Select Companies
| Capital raised (a) | Time to $1 billion (b) | ||||
| M1 Finance | $26.5 million | 41 months | |||
| Betterment | $45 million | 50 months | |||
| Wealthfront | $65 million | 52 months | |||
| Acorns | $93 million | 48 months | |||
| Stash | $181 million | 60 months | |||
| Sources: Crunchbase, SEC, news releases, M1 internal | |||||
| (a) Prior to achieving $1 billion in assets | |||||
| (b) Since date of first launch of service | |||||
M1 reached the $1 billion milestone by tripling assets managed on the platform in 2019. This pace of growth is accelerating as in January 2020 alone, M1's assets grew by 21 percent, and it added approximately 32,000 retail brokerage accounts, more than the approximately 25,000 retail brokerage accounts E*TRADE added over the same timeframe, according to that company’s information.
“M1 Finance’s growth, most of which comes from strong word of mouth, is evidence that there’s a huge market of people who want a next generation money management platform. M1 combines the best of digital investing, borrowing, and banking into one service that's better than the standalone options,” added Barnes.
Since its 2016 launch, M1 Finance has been an automated investing pioneer in a variety of areas:
A Single Platform for Investing, Borrowing, and Spending
M1 is an integrated smart money-management platform for investing, borrowing, and spending.
- M1 Invest – Free, automated investing in a custom portfolio.
- M1 Borrow – Hassle-free borrowing against portfolios with a base rate as low as 3.25%.
- M1 Spend – An FDIC-insured checking account integrated directly into M1, with a 1% cash-back debit card and up to 1.5% APY (with M1 Plus subscription), and other functionality to improve day to day finances.
Capability to Transact in Fractional Shares
M1 Finance was among the first brokerages to offer the ability to buy and sell fractional shares of stocks, allowing self-directed investors to build diversified portfolios of stocks and ETFs of their choosing, regardless of how much they have to invest. For example, a portfolio of Facebook, Apple, Amazon, Netflix, Google, and Tesla can be created with as little as $100, and subsequent investments made into this portfolio for as little as $10.
Free for Investors
M1 was one of the first brokerages to offer no-commission and no-management-fee investing. These market moves, combined with the rise of fintech companies and their popularity with individual investors, caused larger online brokerages to eliminate commissions in Fall of 2019.
“Our ‘Chicago-style’ approach deserves a lot of the credit for our capital efficiency,” said Barnes. "We achieved this growth by being heads down, building a fundamentally better money management experience, and relying on our users to help spread the word. We did not buy growth through massive marketing campaigns. Over the next generation, there will be trillions of dollars flowing from high-cost and outdated money management products. People will seek out the best solution and that's exactly what we are building."
To learn more about M1 Finance, please visit www.m1finance.com.
About M1 Finance
Award-winning M1 helps people manage and grow their money in easy, smart, automated ways – for free – on one integrated, secure platform. By combining investing, cash management, and portfolio lines of credit, M1 provides over 100,000 people with choice and control over a total of more than $1 billion in assets. In 2019, M1 was named Best Robo-Advisor for Sophisticated Investors and Best for Socially Responsible Investing by Investopedia. For more information or to create an account, please visit www.m1finance.com.